CREJ - Land and Development - July 2016
Lone Tree’s RidgeGate community, annexed into the city in 2000, recently celebrated its 15th year of development with the groundbreaking of the southeast light-rail extension, which brings three new light-rail stations to Lone Tree within the RidgeGate community. The transformational RidgeGate project began in 1972 with the acquisition of 3,500 acres that straddle Interstate 25 south of Lincoln Avenue and has already has become the southern gateway into metro Denver. After a long and patient hold period (the land was carried without debt), Coventry Development Corp., which is the property owners’ asset manager and real estate developer, believed it was time to wake up the sleeping giant in response to growth in the metro Denver area and an opportunity to land a major employer as an engine to drive the community’s development. Since then, RidgeGate has accomplished several important public-private partnerships for major infrastructure projects and is now nearing completion of its West Village – 1 square mile that has demonstrated the appeal of a walkable, mixed-use environment and “complete community” to enhance the lives of its residents and provide employers competitive advantages not found elsewhere. So what were the critical factors that have led to the success of the RidgeGate community? Location and patience. RidgeGate Investments Inc. (then known as Colony) had the foresight and ability to purchase 3,500 acres of undeveloped land straddling I-25 in the apparent path of growth (even though at that time there wasn’t much south of Hampden Avenue). Part of the land is served by the Southgate Water & Sanitation District and the remainder was included into the Parker Water & Sanitation District (to which the property’s significant water rights were conveyed). Coventry also manages and will develop the adjacent 1,500 acres immediately south of RidgeGate on the east side of I-25 stretching to the Castle Pines Parkway Interchange (which is still in unincorporated Douglas County) and overlooking the Reuter Hess Reservoir. Interestingly, the land’s previous owner was George Wallace, the developer of the Denver Tech Center (Wallace had a vision of this land as Denver Tech Center II with moving walkways and other futuristic elements). Since the basis in the land was low and there was no debt on the land, the decision was made to hold the land out of development until it had become more of an infill site capable of achieving high land values and sustaining a robust pace of development. So for almost 30 years (and still today on undeveloped portions), the land was kept in agricultural production to keep the tax bill low. Partnership between city and developer on a community vision and appropriate zoning. In 1999, several factors converged that led to Coventry’s conclusion that it might be time to move forward with community activation. Several communities had contacted Coventry about annexing the property into their municipality. In the end, it became clear that a partnership with Lone Tree provided the greatest alignment of goals and objectives. So in fall 2000, after about nine months of master-planning work by Design Workshop (which created the master plan) and a vote of the Lone Tree electorate, which was required by the city charter to annex land east of I-25, the entire 3,500 acres was annexed into Lone Tree and planned development district zoning was approved with 40-year vesting. This gave Lone Tree an “address” on I-25 and plenty of room to grow – the annexation more than doubled the geographic size of Lone Tree and probably quadruples its residential and business population. Lone Tree shared Coventry’s vision for the property as an integrated mixed-use community with a more urban character and vitality not often found in the suburbs at that time. And the planned development district zoning allows for mixed use in most locations with flexibility to adapt to changing market conditions over the project’s long development horizon. The PDD zoning also commits about 30 percent of the land for parks and open space use to complement the compact development and it is organized in way to be highly integrated with the development areas to easily connect people with nature. Subarea plans (another level of city regulatory plan as called for in the PDD), with some additional qualitative guidelines, supplement the PDD for geographic districts and/or product types and then individual projects prepare site improvement plans or plats (for single-family residential). The fact that so much land use entitlement happened in such a short period of time is a testament to the shared vision between Lone Tree and Coventry and a welcome signal to the development community. Financing foundations. Colorado’s Title 32 Statute provides for special taxing districts to help new development “pay its way” for required new infrastructure since cities like Lone Tree do not want to assume that financial burden. In 2001, Coventry formed the Rampart Range Metropolitan District to support the development of the RidgeGate community. This enabled the RRMD to receive several revenue streams, including property tax, system development fees, sales tax sharing with Lone Tree and a private-covenant-enabled public improvement fee that it uses to finance and maintain public infrastructure in the community. RRMD arranges for taxable and tax-exempt financing with the developer and banks and from time to time issues bonds to institutional investors. RidgeGate Investments Inc. has provided significant capital advances to the RRMD to help preservice the community infrastructure. This model has worked and today RidgeGate has a fully serviced West Village supported by over $200 million in assessed valuation that is expected to exceed $300 million by 2025. RRMD is managed by CLA and its legal counsel is McGeady Becher. The district engineer is Merrick & Co. Transportation foundations and public-private partnerships. Critical to the success of any community is transportation mobility and connectivity. RidgeGate has been working on these foundations since 1999 when we engaged with the Colorado Department of Transportation as they were studying the south I-25 corridor. The result of that engagement was a public-private partnership to fund (with over $15 million in land and cash from RidgeGate and the RRMD) and build the RidgeGate Parkway Interchange, which opened in 2009 (10 years later). Also at this same time, Douglas County built Havana Street from the Castle Pines Interchange to RidgeGate Parkway to make an important regional connection. A few years later, Douglas County, Lone Tree and Coventry collaborated to extend RidgeGate Parkway to the town of Parker and to complete the Peoria Street connection to RidgeGate Parkway in order to relieve congestion occurring on Lincoln Avenue east of I-25. This interchange also created the vehicular accessibility upon which Coventry approached the Regional Transportation District with the idea of extending the southeast light-rail line approximately 2 miles to the southeast corner of I-25 and RidgeGate Parkway with an ideal end-of-line commuter station. In 2004, this extension was included in RTD’s FasTracks Program and approved by voters. Now, 12 years later, the extension has broken ground due in part to an unprecedented local funding match put together by Lone Tree, Douglas County, Denver South Transportation Management Association and RidgeGate/RRMD whereby an unprecedented 12 percent of the total project cost is locally funded to supplement a $92 million Federal Transit Administration grant. The remainder of the project cost is paid by RTD. The southeast extension will open in late 2018 with three stations in RidgeGate – one on the west side of I-25 just north of the Sky Ridge Medical Center and two on the east side of I-25, including the end-of-line commuter station with a 1,300-car garage at RidgeGate Parkway and an urban station in the Lone Tree City Center. This extension and the three stations are a “game changer” for RidgeGate in that over 350 acres of development land is now within walking distance of a light-rail station. In the meantime, Lone Tree has operated a very successful (over 62,000 boardings in its first year) free shuttle bus system, the Lone Tree Link, since 2014 to move people from within Lone Tree and RidgeGate to the existing end-of-line Lincoln Station. Once the extension and new stations are opened, it is anticipated that this shuttle system will continue to move people “the last half-mile” from rail stations to key employment centers and other destinations. Recently, Lone Tree started construction of a pedestrian bridge over Lincoln Avenue at the Willow Creek Corridor to enhance pedestrian/bicycle connectivity and safety across this busy arterial. And finally and equally importantly, Coventry has designed RidgeGate with an integrated network of streets to provide for multiple routes and connection. In this way, each of the streets can be a little smaller and more pedestrian friendly than typical suburban streets. Consequently, RidgeGate sees lots of activity from pedestrians, bicyclists and even scooters. Jobs as the engine. Coventry strategically holds the launch of a master-planned community until it has a major employment “engine” to drive the other uses within the community. Rooftops follow jobs and retail follows rooftops. In 1999 and 2000, RidgeGate was being considered by HCA in its site selection process for what is now the Sky Ridge Medical Center. RidgeGate won that competition and in 2001 it sold land to HCA and construction of the hospital started that year. During the ensuing three years, HCA constructed the hospital and Coventry, through the RRMD, funded and built the initial community infrastructure. In the fall of 2003, the Sky Ridge Medical Center opened and provided a much-needed critical service in the regional community as well as many new jobs. Since that time Sky Ridge has continued its planned build out and now employs thousands. And through a partnership it has with Kaiser Health Systems, the Sky Ridge Medical Center welcomes approximately 400 births per month. The Sky Ridge Medical Center also has stimulated a significant medical economy in the area and Coventry envisions complementary “medical centers of excellence” arrayed around it within RidgeGate. In 2012, the RidgeGate vision and community plan was again validated when it won the competitive site selection for the new Charles Schwab Campus, where Phase I of the campus brings over 4,000 new jobs to Lone Tree. The mixed-use recipe: Building a complete community. RidgeGate’s West Village will be mostly built out by 2019 when the southeast light rail extension opens for ridership. By that time, it is expected to be home to approximately 2,280 residential units (about 5,000 people) and 8,000 jobs. Homes range from luxury apartments to condos, townhomes and single-family detached homes ranging in price from the $200,000s to more than $1 million. There are 15 small and distinct neighborhoods to create an appealing scale and offer a wide range of choice. And all homes come with an innovative high-capacity and -speed fiber-optic network that has been in place for over 10 years. The West Village also includes a dozen restaurants, a half-million square feet of retail (including Target, Sprouts and Cabela’s) and three hotels (a select service, an extended-stay under construction and a full-service in planning). In addition to five parks and many miles of trails, including pedestrian underpasses at crossings of major streets, RidgeGate’s West Village includes the Lone Tree Recreation Center, the Lone Tree Arts Center, the Lone Tree Library and the historic Schweiger Ranch – all on land donated by Coventry. And RidgeGate’s trails connect to take hikers and riders to the Cherry Creek Trail System to the east, the Chatfield Reservoir to the west, the Highline Canal to the north and the Reuter Hess Reservoir to the south. RidgeGate’s West Village is supported by the Douglas County School District, which has nearby existing elementary, middle and high schools. In the future, a middle and high school campus and several new elementary schools are expected and being planned for in RidgeGate’s East Village on the east side of I-25. It’s these compact and walkable “complete community” characteristics that set RidgeGate apart from other suburban communities and, when combined with its location and access, creates a very attractive setting for business to locate. The role of private development standards. Another important aspect to the success of RidgeGate are its private development standards enabled by covenant. All buyers and developers of land in RidgeGate must comply with these standards, which are administered through a design review committee of professional architects, engineers and landscape architects and managed by Coventry. These standards are focused on ensuring good architectural design principles, the creation of architectural diversity and variety, the use of high-quality materials and the enhancement of environmental sustainability. RidgeGate 2.0 So what could RidgeGate possibly do to top its West Village? Well, plans are in the works for the RidgeGate East Village (or Villages) on its 4 square miles east of I-25. A higher-density mixed-use transit-oriented district is planned for the areas surrounding the Lone Tree City Center Station and the RidgeGate Parkway Stations of the southeast light-rail line. And to the east, on both sides of RidgeGate Parkway, three different residential villages are expected, each with its own unique characteristics and benefits. Coventry and its partners and consultants are exploring various forward-thinking strategies to take advantage of new technologies and ways of life/doing business that are ahead of us in the coming decades. RidgeGate continues to evolve as a more natural approach to New Urbanism where the city meets the prairie in Lone Tree. And it has successfully demonstrated what can be accomplished when a city and developer work together on an aligned land use vision and have the willingness and commitment to partner on critical supporting infrastructure, community amenities and economic development initiatives.