DENVER | Main Development Thread #7

[Sam Hill]

If you search redfin or zillow for homes in Denver, and sort by price, the very cheapest piece of real estate you will find in the entire city is a 330 square-foot condo in a new-build on 6th and Inca. $150K. They’re income restricted. I don’t qualify for one but a close friend of mine does and he recently bought one. I worry a bit for him. Something doesn’t smell right. And these recent stories of new-builds falling apart don’t help. I hope everything works out okay for him.

One thing I wonder is how exactly does this income-restricted new-build condo concept work in terms of equity. A new-build studio in this city typically goes for well over $300K at a minimum. Does that mean my buddy instantaneously doubles his money the moment he signs the paperwork? My assumption is no fucking way. Obviously. My guess is, whatever monetary value the place gains is completely disconnected from reality. But I haven’t looked into it. It’s one complicated little slice of the market I’ve never taken the time to understand.

Anyway, I worry about the guy. He’s so excited about this place but something about the idea of a $150K new-build condo just doesn’t smell right.

I don’t trust new-builds right now.

[bunt_q]

Originally Posted by Sam Hill

If you search redfin or zillow for homes in Denver, and sort by price, the very cheapest piece of real estate you will find in the entire city is a 330 square-foot condo in a new-build on 6th and Inca. $150K. They’re income restricted. I don’t qualify for one but a close friend of mine does and he recently bought one. I worry a bit for him. Something doesn’t smell right. And these recent stories of new-builds falling apart don’t help. I hope everything works out okay for him.

One thing I wonder is how exactly does this income-restricted new-build condo concept work in terms of equity. A new-build studio in this city typically goes for well over $300K at a minimum. Does that mean my buddy instantaneously doubles his money the moment he signs the paperwork? My assumption is no fucking way. Obviously. My guess is, whatever monetary value the place gains is completely disconnected from reality. But I haven’t looked into it. It’s one complicated little slice of the market I’ve never taken the time to understand.

Anyway, I worry about the guy. He’s so excited about this place but something about the idea of a $150K new-build condo just doesn’t smell right.

I don’t trust new-builds right now.

I imagine he gets stuck the same way renters of rent controlled apartments in NYC get stuck. He won’t have crazy equity to walk away with and upgrade into something better. But as long as he stays he has a roof over his head, which I guess is the point.

[laniroj]

Originally Posted by RyanD

Found this on e-permits: MOD Dwgs Slab demo and replacement on Lvl P2 of parking garage for update the waterproofing and trench drain.


Their website shows that units are available 9/15. Living in a brand new apartment building that was phased construction, I'll tell you... The amount of defects and oversights in construction are astounding.

One of the (not so) hidden costs of multifamily property ownership...you end up spending significant amounts of money every year fixing and refixing defects, though not enough to warrant an insurance claim - just becomes part of OpEx which gets passed down to residents and essentially makes housing more expensive. The labor shortage is a contributing factor to housing affordability in a round about kind of way. At this point, I suspect most developers have a line item in their budget for defects - outside and beyond their typical hard cost contingencies.

[laniroj]

Originally Posted by Sam Hill

...One thing I wonder is how exactly does this income-restricted new-build condo concept work in terms of equity. A new-build studio in this city typically goes for well over $300K at a minimum. Does that mean my buddy instantaneously doubles his money the moment he signs the paperwork? My assumption is no fucking way. Obviously. My guess is, whatever monetary value the place gains is completely disconnected from reality. But I haven’t looked into it. It’s one complicated little slice of the market I’ve never taken the time to understand.

Anyway, I worry about the guy. He’s so excited about this place but something about the idea of a $150K new-build condo just doesn’t smell right.

I don’t trust new-builds right now.

This is an excellent question and one the City has spent a lot of time thinking about in the wake of the affordable ownership debacle that occurred from their prior inclusionary housing efforts...mainly out in Green Valley Ranch. That's exactly what the folks in version 1.0 did, doubled their equity or much more. I believe the new program is that their home values increase from the initial purchase price at CPI (or some equivalent) each year so that the folks build equity and the units remain affordable, but folks don't get to take advantage of the system as they did before where they get hundreds of thousands of free equity.

If you're wondering how these units get built well that's easy - the city, state, and other philanthropic causes write huge checks to cover the gap between the cost to build the housing and the proceeds they can generate from a sale to an income qualified individual. The mountain communities are pros at it, the City of Denver is trying to do more but it will only ever be at the tiny margins of production and it comes at a yuuuuge per home price tag.

Background from the Denver Post: https://www.denverpost.com/2018/09/0...-housing-mess/

[laniroj]

Originally Posted by bunt_q

I imagine he gets stuck the same way renters of rent controlled apartments in NYC get stuck. He won’t have crazy equity to walk away with and upgrade into something better. But as long as he stays he has a roof over his head, which I guess is the point.

^Yep, exactly. This is what we call a static housing market. It's the single most dangerous thing for housing in america and nearly every large city is quickly approaching it. In many ways, Denver is already there, but not full on static like the majority of the east coast cities and california.

[bulldurhamer]

Originally Posted by wong21fr

I'd also suggest that the system works better in the vast majority of the city that was laid out post 1940's (hint: the alley's are wide enough for bins to go on both sides and we don't write passive-aggressive notes to each other on that issue). Moving from dumpsters to individual bins in the pre-1940's area was a mistake in that regard. I think that some sort of centralized collection system is necessary again. Though screw the dumpsters- go Amsterdam style with their recessed bins.

As for the fee structure- there's definitely an incentive for abuse in the proposed system. I'm all for adding a few dozen code enforcement agents and dropping the hammer on non-compliance. Back it up with asset seizure and kick the scofflaws out of the city. If you can't manage your trash bin, there's no way you're responsible enough to manage a home.

There will be inspections, supposedly.

Im still trying to figure how out I'm supposed to keep someone else from using my bins. We can’t keep people from attempting to steal from our cars and yards on virtually a nightly basis, but policing our trash is a priority? How about we do something useful and address this petty crime instead of the typical attacks on the property tax paying homeowners.

The good news is the poor people won’t have to pay so there may finally be some good coming from having revolving gang bangers living right here. We’ll all just put our extras in their large bins. Yimby!

[bulldurhamer]

Originally Posted by laniroj

^Yep, exactly. This is what we call a static housing market. It's the single most dangerous thing for housing in america and nearly every large city is quickly approaching it. In many ways, Denver is already there, but not full on static like the majority of the east coast cities and california.

Of course all of this affordable housing is ridiculous. But then again I suppose with affordable housing we can just give up on that segment ever really doing anything. Keeping the poors in line so they can keep their beds. Not the worst plan ever devised i guess

[bulldurhamer]

Originally Posted by mhays

It's several benefits at once: Reducing the total volume of solid waste, reducing that goes to landfills, providing useful compost, and (perhaps last) providing recyclable material.

IIRC Seattle produces relatively little landfill waste vs. its population and workforce. This is a big part of it.

The point for this thread is people do follow garbage-sorting and graduated-fee programs when they're asked and there's enforcement.

The bin size charges are one of those little nudges that really do work. Every penny increase on cigarette taxes will reportedly spur a relatively predictable decrease in sales, which we know because 50 states and many countries have detailed evidence. Every 10 cents can reduce soda consumption. Every 5 cent bag fee will reduce bag overuse (turns out you can use em several times!).

How many households are really going to start using less trash now? Of course offering composting will help, but you could have been doing that aleady. They made this problem a problem by not bringing the recycling trucks by enough and now get to claim that the landfill will be spared because recycling is coming more often.

This is a self inflicted problem that’s really about the tax, with the landfill questions as the fluff. On the mailer the city even DETERS you from downsizing your trash. I mean come on. They say right there that they dont want you downsizing.

So again, all this really is is just another targeted revenue stream that will only impact homeowners.

[bulldurhamer]

https://denverite.com/2022/08/19/den...bumps-bikeway/

We’re getting speed bumps to save the bikers! ������
Bike lanes recently installed on 23rd and 26th. But now they need speed bumps on 25th? If anyone needs protection, it’s the pedestrians from the bicyclists. That’s no joke.

So how many bicyclists versus pedestrians have been hit in recent years? Yet how much money have been poured into bike infrastructure while the pedestrian crossings and walks have been consistently neglected? Man the political power these cyclists have here is nuts.

[TakeFive]

This article written in 'Denverite Style' is none-the-less well done

Originally Posted by bulldurhamer

https://denverite.com/2022/08/19/den...bumps-bikeway/

We’re getting speed bumps to save the bikers! ������
Bike lanes recently installed on 23rd and 26th. But now they need speed bumps on 25th? If anyone needs protection, it’s the pedestrians from the bicyclists. That’s no joke.

So how many bicyclists versus pedestrians have been hit in recent years? Yet how much money have been poured into bike infrastructure while the pedestrian crossings and walks have been consistently neglected? Man the political power these cyclists have here is nuts.

I like that they solicited feedback from DOTI.

Last December, City Council also voted to lower speed limits on neighborhood streets to 20 miles per hour. Still, as DOTI lead transportation engineer Emily Gloeckner puts it, this won’t work if people don’t obey the rules. “In a perfect world, obviously, we’d want everyone to be courteous to each other and behave, but we know that’s not necessarily the world that we live in,” Gloeckner said.

Exactly! For those who complain about 'speeders' in their neighborhood it's from those who drive more like 50 mph and not those who drive 30 mph. Lowering the speed limit to 20 mph was the city's 'Employment Act' for those who get to make the new signs and replace the old ones.

I'm very aware of speed and 15 mph for school zones makes good sense. In this case it's a more vulnerable population and area that gets chaotic a couple of times a day.

With respect to speed bumps

She said there’s also a lot of study that shows drivers tend to speed up in between bumps and cushions, so there’s a worry the city might spend a ton of money on infrastructure that won’t really make a difference.

Yes, that happens; I do that. But consider that I will slow down to about 10 mph to go over the speed bump before accelerating to maybe 30 mph before having to slow down again to 10 mph for another speed bump So IMO these are worth the investment. For 'faster' drivers they may slow to 20 mph before speeding back up to 40 mph before having to slow down again - so it still has a positive impact.

What I can't speak to is how this will impede snow removal and damage the equipment causing costly repairs etc.

With respect to bicyclists and Bike lanes

bulldurhamer - Your point is well taken. There's a certain percentage of bicyclists, the 'athletic' type that claim entitlement as in "Get out of my way".

The Vision Zero Crowd

There is nothing wrong with being aspirational

The city has committed to curbing deaths on roadways for years, but they haven’t exactly been successful in that effort. 2021 represented a record-high for traffic fatalities in 20 years, and there’s no indication things have slowed this year.

The problem is this group likes to play "Let's Pretend" that the reason for fatal crashes is either the vehicle and/or the street when 95% of the time it's the driver's fault. In fact this is very easy to Google and there's lots of data on the topic.

[bunt_q]

Originally Posted by TakeFive

The problem is this group likes to play "Let's Pretend" that the reason for fatal crashes is either the vehicle and/or the street when 95% of the time it's the driver's fault. In fact this is very easy to Google and there's lots of data on the topic.

Or idiot pedestrians. The data almost always shows that as the driver's fault. I *almost* hit somebody 2 or 3 times a week. I don't, because I am paying attention and evade. And if I did, it would be "my fault." But the reality - if you're trying to get to zero - isn't that easy. It's like getting homelessness to zero.

[DenvertoLA]

So remember when Block 162 was going to be a hotel / office combo... Do they still have plans to build that hotel, or is that dead in the water?

[Denver]

Renderings of the Greyhound station redevelopment. I am hopeful on this one.



https://golubandcompany.com/our-portfolio/

[TakeFive]

Originally Posted by laniroj

haha. I'm still struggling to accept large portions of ballpark as RiNo!

Would you suppose that Putin found inspiration in RiNo appropriating about half of the Ball Park neighborhood.
-----------------------------

When the driver is NOT at fault

Originally Posted by bunt_q

Or idiot pedestrians. The data almost always shows that as the driver's fault. I *almost* hit somebody 2 or 3 times a week. I don't, because I am paying attention and evade. And if I did, it would be "my fault." But the reality - if you're trying to get to zero - isn't that easy. It's like getting homelessness to zero.

Totally agree that with the Vision Zero crowd, they want to make it the driver's fault and never the 'innocent' pedestrian. It's extremely hazardous when pedestrians (or in some cases bike riders) pay no attention to traffic and WEAR DARK CLOTHING. This is especially hard to see at night but really any time of day dark clothing is harder to see.

The irony is that last night while driving I noticed how many of the homeless who use bikes generally ride defensively, knowing the road is dangerous. Oddly enough I was impressed.

[Robert.hampton]

Originally Posted by bulldurhamer

So again, all this really is is just another targeted revenue stream that will only impact homeowners.

No - this is a well supported, data-driven approach driven by behavioral economics. You make people pay more for trash, they'll produce less of it. You make composting free, they'll start using more of it. You make trash more expensive and recycling more frequent, people will recycle more.

[TakeFive]

Largely Agree

Originally Posted by laniroj

^Yep, exactly. This is what we call a static housing market. It's the single most dangerous thing for housing in america and nearly every large city is quickly approaching it. In many ways, Denver is already there, but not full on static like the majority of the east coast cities and california.

This so much reminds me of late 1970's or early 1980's and I'm afraid that the Fed will have to raise rates higher for longer than what they were hoping to kick the inflation devil. That said, commercial construction and we can include multifamily should do fine thanks to institutional funding availability.

Couple of things: One is Team Biden is inputting big chunks of money into the economy and second thing is I sense a 2nd wave of inflation working it's way through the system.

I won't complain about money coming from the Inflation Reduction Act (except for the name which was dumb). While nothing is perfect, thanks to Joe Manchin and my own Senator Sinema it's close enough. There's certainly no shortfall of money going for defense and the CHIPS Act was also spot on. So while some parts of the economy will be soft other parts are booming (or will be).

[TakeFive]

Nice Find

Originally Posted by Denver

Renderings of the Greyhound station redevelopment. I am hopeful on this one.



https://golubandcompany.com/our-portfolio/

Sure like the concept rendering.

[CONative]

Originally Posted by laniroj

This is an excellent question and one the City has spent a lot of time thinking about in the wake of the affordable ownership debacle that occurred from their prior inclusionary housing efforts...mainly out in Green Valley Ranch. That's exactly what the folks in version 1.0 did, doubled their equity or much more. I believe the new program is that their home values increase from the initial purchase price at CPI (or some equivalent) each year so that the folks build equity and the units remain affordable, but folks don't get to take advantage of the system as they did before where they get hundreds of thousands of free equity.

If you're wondering how these units get built well that's easy - the city, state, and other philanthropic causes write huge checks to cover the gap between the cost to build the housing and the proceeds they can generate from a sale to an income qualified individual. The mountain communities are pros at it, the City of Denver is trying to do more but it will only ever be at the tiny margins of production and it comes at a yuuuuge per home price tag.

Background from the Denver Post: https://www.denverpost.com/2018/09/0...-housing-mess/

RE: Affordable housing equity...

If I remember correctly, most Denver for-sale affordable programs do allow equity to build -- but they limit your home equity to no more than 3% each year. If the market increases 10% in a given year, you only get 3%. Keeps the cost of the affordable housing down and gives equity to the homeowner.

[CONative]

Originally Posted by Sam Hill

If you search redfin or zillow for homes in Denver, and sort by price, the very cheapest piece of real estate you will find in the entire city is a 330 square-foot condo in a new-build on 6th and Inca. $150K. They’re income restricted. I don’t qualify for one but a close friend of mine does and he recently bought one. I worry a bit for him. Something doesn’t smell right. And these recent stories of new-builds falling apart don’t help. I hope everything works out okay for him.

One thing I wonder is how exactly does this income-restricted new-build condo concept work in terms of equity. A new-build studio in this city typically goes for well over $300K at a minimum. Does that mean my buddy instantaneously doubles his money the moment he signs the paperwork? My assumption is no fucking way. Obviously. My guess is, whatever monetary value the place gains is completely disconnected from reality. But I haven’t looked into it. It’s one complicated little slice of the market I’ve never taken the time to understand.

Anyway, I worry about the guy. He’s so excited about this place but something about the idea of a $150K new-build condo just doesn’t smell right.

I don’t trust new-builds right now.

RE: Affordable housing equity...

If I remember correctly, most Denver for-sale affordable programs do allow equity to build -- but they limit your home equity to no more than 3% each year. If the market increases 10% in a given year, you only get 3%. Keeps the cost of the affordable housing down and gives equity to the homeowner.

[TakeFive]

Downtown Denver only half recovered from COVID pandemic
Aug 26, 2022 by: DJ Summers - KDVR

If this sounds familiar it's b/c it's the same data source which I previously posted about. The good news is no politics here but a rather well written article.

One thing worth pointing out is they extracted the map of downtown Denver that was used for their analysis. See Here. As you can see downtown does NOT include Ball Park or RiNo neighborhoods (which makes sense).
---------------------------

Many may have noticed how in recent years several developers from Chicago have come to Denver. Were they looking for 'greener pastures' or just trying to beat the rush out of town?

https://www.bisnow.com/chicago/news/...14407?rt=88442

After teasing a departure over the city’s rise in violent crime for months, billionaire Ken Griffin finally bit the bullet this past June, announcing plans to move his investment firm Citadel from downtown Chicago to Miami, complaining the city had become too dangerous to house the multinational hedge fund.

“If people aren’t safe here, they’re not going to live here,” Griffin told The Wall Street Journal this spring, pointing to colleagues who'd been mugged at gunpoint, stabbed or burglarized. “I mean, that’s a really difficult backdrop with which to draw talent to your city from.”

Some may not be familiar with Ken Griffin/Citadel but there's more, much more.

Griffin is not the first executive to express major concerns about crime’s impact on the city's business community nor the first to decamp for greener pastures — aerospace giant Boeing and equipment manufacturer Caterpillar also announced plans to leave the city in recent months.

Boeing is moving to Arlington, VA and Caterpillar is moving to the Dallas-Fort Worth suburbs.

Note: - It's not like Denver is sitting on their thumbs; they are making an effort. RTD was recently in the news for adding to their Security detail with a focus on Union Station. It is frustrating to see all the money that 'crime' etc is costing the city but that's the world we live in, I guess. Without better 'low tolerance' boundaries it's hard to get ahead of things.