Posted: November 01, 2013
Real estate: A tale of five cities
From Denver to Durango, new projects signal developers’ renewed confidenceMike Taylor
Authority-approved special taxing district eligibility. A once-blighted 80-acre parcel, the retail property now generates millions of dollars in sales-tax-revenue and serves as a key UCCS student employment center.
More than 30 tenants have already leased space in the 80-acre retail hub, according to private developers Kevin Kratt and Tom Cone.
Kratt credits early decisions by anchors Costco, Kohl’s and Lowe’s as well as the center’s proximity to the campus for its thriving occupancy.
“We opened just as the recession hit bottom – most new retail centers wouldn’t have made it. So far, though, we haven’t lost a single tenant,” he said, adding that University Village has become “a true community center.”
UCCS Executive Vice Chancellor Brian Burnett said the project became a priority when deteriorating conditions along the North Nevada corridor began to affect the university’s ability to attract new students and capital investment. The university lobbied city council as early as 2003 to get Urban Renewal Authority approval for special taxing incentives and to create the partnership.
“The university has become a powerful local economic engine. This development was vital to our future,” Burnett said.
Today the project’s bonds are being repaid, and momentum along the corridor continues with two new projects: the $17.6 million Lane Center for Academic Health Sciences and a $20 million Capstone Collegiate Communities’ 600-bed-student housing complex.
Banning Lewis Ranch
Last year Oakwood Homes purchased almost 3,000 acres of bank-owned land for $16 million. The property was part of the original 22,000-acre Banning Lewis Ranch on the city’s east side. The new master-planned community will eventually include 9,500 residents, shopping districts, schools and parks, says Oakwood Homes CEO and Chairman Pat Hamill.
Home sales have been brisk. The company’s six new neighborhoods led the city in new home sales for the second quarter and earned nine 2013 Parade of Homes awards. As of Oct. 1, more than 200 homes had sold.
Hamill said Oakwood will partner with other developers on future commercial, recreational and active adult living opportunities.
Further south the remaining 18,000 acres at Banning Lewis Ranch was put back on the market by the owner, Houston-based Ultra Petroleum. The company announced this summer that it was abandoning plans to drill on the property when initial tests showed existing oil was “too immature.”
— Becky Hurley
Commercial and residential make comebacks in Fort Collins
While expansions of craft breweries regularly make the news in Fort Collins, the recovery of the city’s commercial and residential real estate markets is largely the result of an improving economy that’s enabled alternative energy and high-tech businesses to expand and build new campuses.
“It’s been pretty active compared to a few years ago,” said Peter Kast, broker/partner with Realtec. “Commercial lending is just starting to come unglued. Banks are back in the market.”
The biggest project in the works is the $200 million corporate campus Woodward Inc. is building for its global headquarters. With the new campus, the company, which designs and manufactures control systems for the aerospace and energy markets, expects to add 700 jobs over the next 10 years.
Woodward’s expansion comes at the same time Colorado State University’s Engines & Energy Conversion Laboratory is growing. Long a supporter of the lab, Woodward is helping fund its $18.5 million expansion, where the company intends to collaborate and research with CSU faculty and students.
In addition to Woodward, Cummings and Caterpillar also will have a presence in the LEED Platinum facility.
“This is creating a lot of interest in Fort Collins,” said Bob Hosanna, senior design manager at The Neenan Co., which designed and is building the project. “Cummings and Caterpillar would not even look at Fort Collins, but now they have a presence, which adds to the vitality of downtown.”
Woodward isn’t the only entity expanding in Fort Collins. Others include:
• Avago Technologies Wireless Manufacturing, which is planning a $20 million addition to its 70-acre campus.
• Fort Collins Museum of Discovery, which will start a 47,000-square-foot expansion early next year.
• Banner Health’s new 145,000-square-foot hospital, expected to open in 2015.
• Alberta Development’s proposed $250 million redevelopment of Foothills Mall.
“The total potential project cost is $1.2 to $1.5 billion over the next few years,” said Walt Elish, president and CEO of the Northern Colorado Economic Development Corp.
The residential market is also booming, with a year-to-date increase in sales of 17.5 percent. With just a two-month supply of inventory – normal is about six months – the average sales price of a home in Fort Collins is up 7.3 percent.
“It’s a scramble because there are more buyers than sellers,” said Dave Pettigrew, broker/owner of Fort Collins Relocation.
The thriving market also is seeing the large home builders that left during the recession return. So far this year, 130 permits for new homes have been issued in Fort Collins, compared with 131 for all of 2012.
Multi-family development also is taking off. McWhinney is near completion of The Trails at Timberline, a 314-unit pet-friendly community at 2451 S. Timberline Road that includes community garden plots, a golf simulator and a two-lane bowling alley.
“The Fort Collins market, unlike parts of metro Denver, has not had the influx of new apartment buildings, so we believe there’s significant unmet demand,” said John Shaw, president of Loveland-based McWhinney.
— Margaret Jackson
Mike Taylor is the managing editor of ColoradoBiz. He writes about small-business money issues and how startups are launched. Email him at email@example.com.