CREJ

Page 2 — Multifamily Properties Quarterly — November 2019 www.crej.com Letter from the Editor A s we were getting ready to print, a report came out that caught my attention. Denver was named the greenest U.S. city in CBRE’s inaugural Green Building Adoption Index for Multifam- ily Buildings. In total, 7% of Denver’s multifamily units are certified “green,” receiving certification from the LEED program, Energy Star and/or the National Green Building Standard.This was more than double the national rate, and it means 17,230 units out of the 246,670 Denver multifamily units in investment-grade properties (proper- ties with 50 or more units) are classified as green. The study looked at the 30 largest multifamily markets and found the average percent certi- fied to be 3.3% – 251,763 units out of the 7.7 million units across the coun- try.Trailing closely behind Denver in the top five were theWashington, D.C./ suburban Maryland market, Seattle, NorthernVirginia and Chicago. Probably not surprising, the building vintage can play a big part in the likeli- hood of certification. Nationally, 15.3% of multifamily buildings constructed since 2010 are certified, while less than 1% of buildings built between 1960 and 2000 are certified. Also, Class A proper- ties are far more likely to be certified – 9.1% compared with 1.1% for Class B and less than 1% for Class C. While this is the first year examin- ing multifamily properties, CBRE and a consortium of Maastricht University and the University of Guelph have been releasing an office report annu- ally since 2014.This year, Denver rose one spot on that list, to No. 8, with 48.2% of its office space now certified green. “It’s no surprise Denver’s commer- cial spaces are getting greener, as a connection to the outdoors is what attracts many people to our region in the first place,” said Pete Schippits, senior managing director of CBRE’s Mountain States. “Today building own- ers are realizing the value of sustain- ability in many forms – from increas- ing operating efficiency, to improving tenant satisfaction and attracting investor interest in a property.” As we hear how the rising costs of labor, materials, land, permitting, municipal demands, etc., continue to place a heavier burden on develop- ment, it’s nice to see proof that the “greening” of our living spaces isn’t being scarified to make projects pencil. In fact, according to Martin Gibeau’s article on Page 14, many of the recently built and proposed buildings that place an emphasis on energy-efficient design and amenities are asking their tenants to do the same. Some proper- ties even advertise resident perks for renters who use public transit and make other choices that benefit the environment, which is something the residents seem to appreciate, he writes. Michelle Z. Askeland maskeland@crej.com 303-623-1148, Ext. 104 Denver is green living leader Contents 4 6 8 10 12 14 16 17 18 19 20 21 22 23 24 25 30-38 How Denver rents stack up to buying in the city Terrance Hunt Apt. industry, residents contribute $39B to Denver Lauren A. Brockman and Drew Hamrick Colorado Springs enjoys a downtown revival Doug Carter and Cary Bruteig Insatiable pace continues in Northern Colorado Jake Hallauer Signs of life for condo projects slowly emerging Jonathan Pray and Catherine Hildreth Despite concerns, everything’s still sunny in Denver Martin Gibeau Where are Denver apartment rents headed in 2020? Connor Briggs Investors seek wider range of capital sources Patrick O’Malley Consider using a HUD loan for market-rate deals Mike McKenzie and Keely Downs Public-private partnerships provide project options Kevin Brinkman Improving access to affordable housing in Colorado Kim Duty Incentive suggestions for addressing affordability Chris Muhle The broker’s role in new condominium projects Susan Chong Designing for a new era of multifamily development Sarah Linback and Jovina Amor Navigating utility pitfalls in new construction Nick Dunham Multifamily assets are key to closing digital gap Stephan Andrade Affordable Housing spotlight