Colorado Real Estate Journal - July 15, 2015
With more than 2,600 hotel rooms completed or under construction, downtown Denver’s hotel market will top the 10,000- room mark. The new inventory is among $4.8 billion worth of commercial real estate development in 71 projects downtown within the last five years, according to the Downtown Denver Partnership. “More people are living and working downtown than ever before, creating a strong demand for development,” Tami Door, the partnership’s president and CEO, said at the organization’s annual Development Forum June 30. “It’s clear that our collective community efforts to build a world-class center city and to achieve our vision of an economically healthy, growing and vital downtown are attracting investors and developers alike.” Saunders Construction released a development map at the forum that highlights the 71 hospitality, office, multifamily and mixed-use projects, as well as public projects, developed and coming to downtown Denver. A total of 3.06 million square feet of office has been added or is under construction; 5,565 residential units have been added or are being built; and 2,630 hotel rooms have been added or are under construction. “That construction is really in response to demand,” Bill Mosher of Trammell Crow Co. and chairman of Denver Civic Ventures said of the new hotel inventory. “We build, and everyone continues to see higher rates.” Matt Frankiewicz, senior director of development and asset management for White Lodging, which is developing two dual-brand hotels in downtown Denver, said Denver is one of the top 25 hotel markets in the country. One of the reasons White Lodging likes the market, he said, is that, “From a hotel standpoint, we love to have supporting amenities – great walkable retail, entertainment concepts – near the hotels for our guests to patronize.” Citing the Rocky Mountain Lodging Report, Frankiewicz said as of May downtown Denver hotel occupancy was 82 percent, with rates averaging $192 per night – up 7 percent year over year. White Lodging will break ground within the next 30 days on a 495-room building that will include one of the first urban AC Hotels by Marriott in the country and a Le Méridien. The hotels will be located at 15th and California streets. Michael Everett of Sage Hospitality gave an overview of Z Block, a mixed-use development it is building with McWhinney and Grand American near Denver Union Station. The $169 million project will include 200,000 sf of office space, 96,000 sf of retail and a 170-room independent hotel. Everett said Sage wanted an unbranded hotel, something that was unique to Denver, for Z Block. “We think there’s a distinct lack of great independent hotels downtown,” he said. A new office project – the Triangle Building at 1550 Wewatta St. – also was highlighted. The top three floors of the iconic 227,534-sf building are preleased. Developer East West Partners, which developed Riverfront Park, will complete the building within 45 days. The Downtown Denver Development Map is available at http://www.down towndenver.com/wp-content/ uploads/2013/10/2015-Down town-Denver-DevelopmentMap-FINAL-for-web.pdf.