Cali Developer Bets on Denver
Our heated multifamily market has a new player from California.(Don't people usually go to California in search of gold, not vice versa?)
MKS Residential has acquired a five-acre parcel within the Cherry Creek Corporate Center redevelopment, with plans to build a 341-unit luxury apartment complex (and a giant yellow wall around the whole thing to protect itself from the encroaching red color).It's one of the few ground-up apartment developments focused outside the Union Station area as well. The redevelopment of Cherry Creek will also demolish the older Spanish Gate apartments (with a parking deck slotted in its place).
ARA's Steve O'Dell and Chris Cowan brokered the sale on behalf of the seller, a JV between DPC Development and a Salt Lake City private equity firm. We chatted with Steve and Chris, who've been having a helluva year. Despite the tremendous number of new units coming soon in metro Denver, Steve says the vacancy rate isn't likely to budge much. "Historically, Denver absorbs about 5,000 units a year. Right now there's upwards of 20,000 units in various stages of planning," he says. But the units are being delivered over the course of four years. Steve observes. "We will probably be at 5% equilibrium in four years."