Colorado Real Estate Journal - June 3, 2015
A Tennessee-based company is moving forward on three luxury, high-profile apartment communities in Denver and Boulder. Together, the communities developed by Southern Land Co. will have 863 units. Two of the communities will be in Denver and one in the heart of Boulder, across from Google’s planned office campus. “We’re trophy hunters,” said Ken Howell, the chief financial officer for Southern, which is based in Franklin, about 21 miles outside of Nashville. “We look for sites that are irreplaceable and will stand the test of time,” Howell said. Although the communities are in different neighborhoods, they all share the same objective, according to Tim Downey, CEO of Southern. “Our No. 1 goal is to build vibrant apartment communities where our residents can enjoy a comfortable, fun and healthy lifestyle,” Downey said. “The right mix of amenities, convenience and an additional element of luxury are things we believe make a real difference,” Downey said. “We are very excited to bring this development approach to Denver and Boulder, which we believe will be a key factor in ensuring overall project success for our investors and the community,” according to Downey. Currently, Southern is under construction on one of the three developments on its plate. The one under construction is a 317-unit apartment community at 18th and Central streets in Denver’s LoHi neighborhood, across Interstate 25 from downtown Denver. It will open next year. The site formerly was the headquarters of the Mile High United Way. Records indicate that Southern paid $10 million for the site in 2013 and $2.05 million for an adjoining parcel. The new community will be one of the few being built in LoHi that will include a swimming pool. It also will have a 24-hour fitness center and a rooftop deck with fire pits and on-site pet services. There will be 405 underground parking space, bicycle storage and bicycle repair facilities. The community also will include 9,300 square feet of ground-floor restaurant and retail space. “What attracted us to LoHi in the first place was this very active restaurant scene, these amazing views and great access to downtown,” Howell said. Despite the concentration of recently completed apartment communities in LoHi and a number either under construction or on the drawing board, Howell is not worried about competition. “We are at Main and Main,” Howell said. “I would not trade our site for any other site in LoHi.” Also, Southern’s LoHi community is bigger than just about any competitor in one of Denver’s trendiest neighborhoods. “Some more product has come on line since we bought the land, but most of them are 75 to 80 units and cannot offer the full amenity package that we will be providing,” Howell said. “We will be offering a swimming pool, for example, which very few other projects in the area are big enough to offer,” Howell said. The community also is minutes away from the 16th Street pedestrian bridge that links LoHi to downtown, as well as all of the restaurants and bars in the neighborhood, he said. When Southern bought the Mile High United Way property in 2013, it also put a 2.5-acre site under contract in Boulder. That purchase did not close, but it found an even better site in what is known as the Boulder Junction redevelopment at 30th Street and Pearl Parkway. “We bought a six-acre site, which included a bit of land assemblage, across the street,” Howell said. Not only was the site bigger, but the story gets better. “Google is building its (330,000-square-foot) campus across the street,” Howell said. Howell loved the site even before Google came into the picture. “There was a little bit of luck,” that Google plans a campus across from its community, he admitted. He expects that many Google employees will be drawn to the 246 units it expects to build. “We think that will be a natural fit,” Howell said. “Obviously, having 1,500 people who can walk from work and not have to worry about transportation is a big benefit for us and for Google employees,” Howell said. He only wishes he had more units. “We originally were planning about 400 units but we downsized it to about 250,” Howell said. The apartments will be part of a mixed-use development that also will include 120,000 sf of office space and 25,000 sf of retail/flex space. He expects that most of the buildings in the development will have four stories. Southern’s third planned apartment community is in the Uptown neighborhood near downtown Denver. That community would have about 300 units and about 10,000 sf of ground-floor retail and restaurant space. “We have a 1.5-acre site under contract, which is expected to close this summer,” Howell said. “It’s a really great site,” Howell said. “It is near all of those great restaurants up and down 17th Avenue. And it is a 10-minute walk to downtown.” Although Southern made its first purchase in Denver in 2013, Howell has had his eye on the area for more than a decade. He worked for McWhinney from 2004 to 2008. Most of our work at the time was in Loveland and Northern Colorado,” Howell said. “But I got to know the entire Denver metro area while I was there.” He continued to keep tabs on the area, when his son enrolled at the University of Colorado in Boulder. “That gave me a good reason to come to Colorado and whenever I was visiting my son, I would check on the area to see what is happening,” he said. He’s been thrilled by the economic and job growth in the Denver area in recent years. “There’s been a great job story in the Denver area in the past two, three or four years,” Howell said. “My guess is that maybe outside of Dallas and Houston, Denver has had the best job story in the country. Denver is doing a very good job of attracting and retaining a lot of recent college grads. Denver is top in the country for attracting millennials. They want to live here for its lifestyle and job opportunities.” Going forward, Southern expects to grow its footprint in the Denver area. But it will be picky. “Our general goal is to find one great site every year,” Howell said. He said his team has excellent connections with the Denver-area brokerage community to help it achieve that goal.