Aerotropolis on the Horizon
Amid tourism's surge and an increasingly global economy, DIA might be the center of the Denver area's next business district
Denver International Airport is Colorado's largest economic engine, generating more than $26 billion annually for the state. Population-wise, Denver is the 19th largest metropolitan statistical area in the U.S. — but it has one of the busiest airports in the country. In 2016, 58.3 million travelers landed at DIA.
“It was a milestone year,” says Richard Scharf, president and CEO of Visit Denver.
That milestone exposed a big change in Colorado tourism trends. Denver voters approved an increase of tourism marketing dollars in 2005; since then, local tourism has grown at nearly three times the pace of the national average: 62 percent for Denver, compared with 22 percent nationally. Travelers used to fly to DIA in the winter for ski trips; now, people come to experience the city of Denver and its neighboring counties.
Development around DIA has been “a powerful example of public infrastructure says Randy Thelen, VP of economic development at the Downtown Denver Partnership. While Denver’s 2017 tourism figures won’t be available until June, statistics from the previous year show that Denver welcomed 31.5 million total visitors in 2016, including 14.2 million day visitors and 17.3 million overnight visitors.
Overnight visitors surpassed 2015 totals by nearly 1 million, a 6 percent year-over-year increase — and 2016 travelers also spent 5 percent more than they did in 2015, establishing a tourism revenue record for Denver of $5.3 billion. More than $1.5 billion was spent on lodging, and another $1.5 billion was shelled out for gas, car rentals and other local transportation purchases. Tourists purchased more than $1 billion worth of food and drinks, and spending at retail stores hit $660 million.
Like it or not, Denver is an internationally known city, a place where people from across the globe want to come to work and play. In an effort to leverage Denver’s biggest asset – its airport – city planners from five counties are joining forces to advance Denver Mayor Michael Hancock’s campaign promise for “Aerotropolis.”
Twenty-five miles northeast of downtown Denver, DIA is a natural metropolis expansion zone for the city of Denver. But don’t think of Aerotropolis as a new downtown. Think of it as another Denver Tech Center — “an important piece of our economic ecosystem,” says Evan Dreyer, Hancock’s deputy chief of staff.
Hancock’s original concept was “Airport City,” which referred to commercial development on DIA grounds. “We don’t use that phrase anymore,” Dreyer says, noting that the project has become “a regional concept.”
DIA might be built on Denver land, but with the exception of Denver’s Green Valley Ranch neighborhood, the developable space surrounding DIA is in Commerce City, Brighton, Adams County and Aurora. The city of Aurora also owns the second entrance into DIA, along Jackson Gap Street, which was extended to East 56th Avenue and opened in 2015.
In 2016, Colorado Department of Transportation wrapped up its “Colorado Aerotropolis Visioning Study.” Funded by a grant from the Federal Highway Administration, the study spawned a regional committee with stakeholders from Denver, Commerce City, Brighton, Adams County, Aurora and DIA. In all, 124 people participated in 37 open meetings, generating ideas for Aerotropolis and identifying obstacles to avoid.
“The CDOT study was a good first step toward bringing the region together,” Dreyer says. “We’ve been meeting weekly for a year, and a lot of the work that’s happening is quiet, behind-the-scenes work.”
Each of the cities involved with Colorado Aerotropolis has its own citywide vision plan, along with pre-existing land use and zoning laws. For airport development to reach its maximum potential, jurisdictions must work together to formulate a strategy that works for all entities involved — including DIA.
What will Colorado Aerotropolis look like? That’s still up in the air, but similar developments provide glimpses into a futuristic mixed-use concept. City planners in Colorado have studied American business consultant John Kasarda, who pioneered the strategy of airport-driven development. “We’ve been looking at cities around the world,” Dreyer adds, pointing to the O.R. Tambo International Airport near Johannesburg, South Africa, and Amsterdam Airport Schiphol in the Netherlands. Closer to home, the Dallas-Fort Worth International Airport sets the precedent for Colorado.
PAVING THE WAY FOR AN AIRPORT METROPOLIS
In 1995, Denver Mayor Federico Peña, secretary of transportation in the Clinton administration, paved the way for an airport city when he moved Denver’s original airport east rather than expand Stapleton Airport.
Waves of economic downturn halted previous plans for commercialization around DIA until 2011, when Hancock included in his mayoral platform an urban plan with its layout, infrastructure and economy centered on DIA. Hancock had served on the Denver City Council from 2003 to 2011, and his district included the airport. The politician was well aware of DIA’s economic potential.
The first step was expanding DIA’s operations.
“To be serious about attracting big business, we have to connect to destinations around the world, both conveniently and affordably,” says Hancock, who, along with DIA staff, has courted airlines by making a strong business case for Denver.
Efforts were overwhelmingly successful. From Cozumel and Calgary to London, Paris, Panama City and Zurich, travelers from 26 international destinations will have direct nonstop access to DIA by the end of 2018. More exciting still, DIA hasn’t come close to reaching its full potential. DIA is the largest airport in the country by landmass, and with 9,000-plus acres of undeveloped land, it has room to build six more runways.
DIA’s fringe is prime real estate, given its proximity to a major international airport, a major interstate (I-70), and the RTD A-line, a commuter rail that became operational in 2016 and shuttles passengers between DIA and Union Station.
There are 25,000 acres of planned development near DIA, and “a large portion is in Aurora,” says Aurora Deputy City Manager Jason Batchelor, adding, “We’ve always envisioned the location south of DIA as a key development area.”
Scheduled to open in December 2018, Gaylord Rockies Resort & Convention Center is the biggest Colorado Aerotropolis project. National Gaylord brand resorts include Gaylord Opryland in Nashville, Tennessee; Gaylord Palms in Orlando, Florida; Gaylord National in Washington D.C.; and Gaylord Texan, a few miles north of DFW International Airport.
Capturing the destination and leisure markets, the Gaylord Rockies property will have 1,501 guest rooms, including 114 suites, and more than 485,000 square feet of flexible meeting, convention, outdoor and pre-function space — not to mention a 175,000-square-foot exhibit hall, four ballrooms, and eight dining outlets.
There have been 10,000 new construction jobs associated with the Gaylord Rockies project, and Batchelor says, “Construction is progressing extremely well.” Gaylord Rockies already has 627,000 nights booked at its hotel, with bookings dating out to 2024. About 85 percent are business travelers who will be coming to Colorado for the first time for conventions. “We are bringing new visitors and new dollars,” Batchelor says. “The estimated annual economic benefit to Colorado is over $270 million.”
Owned by Phoenix-based A&C Properties, Porteos is also out of the ground. The 1,300-acre development is 2.5 miles south of DIA in Aurora and currently includes a 7,500-space parking complex — but there are plans to construct industrial buildings alongside hotels, shops, restaurants and offices, with Walmart anchoring the forthcoming retail center.
CATALYSTS FOR CONSTRUCTION
“Gaylord is going to be the biggest development, but it won’t be the first,” Dreyer says, noting that DIA proximate facilities started popping up at least a decade ago. “There are a number of hotels and restaurants, and some office space, at 72nd and Peña,” he says, but the real catalysts have been the RTD A-Line and Panasonic.
Tech-company Panasonic laid the groundwork for a “smart city” in 2015 by installing infrastructure such as WiFi, LED street lights, pollution sensors, and a solar-powered microgrid on 400 acres of empty land nine miles southwest of the airport, near the Peña RTD station.
Development of Colorado Aerotropolis has been slow — and that’s a good thing, Dreyer says. “We’re talking about a time horizon that’s decades into the future,” he says. “Everything we’re doing is intentional, and a slower pace helps us to ensure that we won’t run into the same problems we had in Stapleton, which was development getting too close to the runways.”