RedPeak Properties has released a rendering of the four-story, luxury apartment building it plans to build on West Moncrieff Place in West Highland.
Previously, RedPeak had released elevations of two five-story, nearby apartment buildings it plans to develop on Lowell Boulevard and Meade Street in Highland Square, just north of the popular and trendy West 32nd Avenue corridor.
RedPeak, after discussions with City Councilwoman Susan Shepherd and with constituents representing various neighborhood and retail interests, agreed to lower the height on the Moncrieff building by one floor.
Some members of a grassroots group called No High Rises in West Highland contend that was not a concession by RedPeak, but rather a calculated decision to increase its profit on the Lowell building, because the Denver developer could conceivably charge more rent on some units on Lowell that would have better views of downtown without an extra story on Moncrieff.
That is not the case, said Evan Lichtenfels of RedPeak.
“That is a misconception,” said Lichtenfels, development director for RedPeak. “One of the concessions we agreed to was to lower the height of the building on Moncrieff from five stories to four stories.” He said RedPeak lowered the height because of the units proximity to single-family homes.
Modest rent increases possible in 4 units
“There was a discussion at one of the Design Advisory meetings where we talked about if that we lowered the height on Moncrieff that would improve the views on four units with views of downtown on the fifth floor of the Lowell Boulevard building ” he said. “The best we have ever been able to achieve in additional rent at other developments because of better views is about $25 per month. So if we were able to get another $25 per unit that is $100 per month. When you compare receiving an extra $100 per month to having another seven to nine units on a fifth floor on Moncrieff, where rents are averaging $1,000 to $2,000 per month, it does not make economic sense to say that we are removing the fifth floor as an economic benefit to us.”
Several people who work at competing construction and development firms said that financially, RedPeak would be better off to pay the incremental cost of adding a floor, rather than hope to achieve slightly higher rents in other units.
The buildings are being designed by Brad Buchanan of RNL
Moncrieff the most challenging site
The Moncrieff site was the most difficult to work with, Buchanan said. “It is the toughest in terms of its size,” Buchanan said. “It was the smallest of the three sites. There is an old adage in architecture – form follow function. If you try to fight it, you can run into problems. In this case, form clearly follows function. I think it is very successful and dramatic in how it steps down. I am very happy how it turned out. I think most of the people who sat around the table at the design committee also are happy with it.”
However, Buchanan said he doesn’t think it will please everyone.
“I don’t think it will make everyone happy because there are still some folks who will only focus on the height-dimension,” Buchanan said. “I do think there are some other people who have grown to appreciate that we have taken some architectural solutions to address and mitigate the height. I do think all of the scrutiny and concerns raised by members of the Design Advisory Committee really pushed the design team and we ended up with a better design because of the input.”
Buchanan also said that he is glad that the three buildings are not carbon copies of each other.
“I am very happy that we are ending up with three distinctly different buildings,” he said. “When we first started we weren’t sure how that would play out. Were all three buildings sort of going to go in the same direction? If not identical to each other, were they going to look like they were in the same family, cousins,f not brothers and sisters? But because we responded to the constraints of the sites, which were different in each case, we ended up with different buildings. The physics of the sites introduced some challenges, but in this case, the challenges became opportunities.”
The Moncrieff Place building will have 29 units, the Lowell Boulevard building 70 units and the Meade Street building will have 48 units, for a total of 147 units. The entire project is expected to cost in the neighborhood of $30 million to $35 million. It will create an estimated 200 to 250 construction jobs during the 18-month construction period, although not all of them will be on the site at the same time.
“We are very happy with the design,” Lichtenfels said. “The building on Moncrieff was very well received when we presented it at the most recent Design Advisory Committee meeting.”
The image in the rendering is from the perspective of someone standing across the street and looking to the south, he said. The elevation shows balconies on some units. They may or may not stay. “This is a preliminary elevation,” he said. “This is the first iteration and it may change. We received some good feedback at the last design meeting and we will be taking their suggestions into account as we move forward.”
The committee has representatives from Shepherd’s office, the No High Rise group, the West Highland Neighborhood Association and retailers.
Lichtenfels said the next meeting will likely be in a month or two, but it may be with different people.
“Our next meeting might be with representatives with more of a background in construction-related activities,” he said. “The next discussion will likely be less design-focused and more focused on the actual construction. We will be looking at issues such as street closings and how to minimize the impact on the neighborhood during the construction.”
He said construction likely will begin in early August.
Nearby apartment community underway
Separately, Lauren Brockman of Allied Realty recently announced an $80 million, 332-unit luxury apartment development about a mile away near Interstate 25 and Speer Boulevard in Jefferson Park.
“I absolutely think there is enough demand for both projects,” Lichtenfels said. “I have an interesting statistic. From 1990 to 2011, zero new apartment units opened in West Highland. There is a lot of pent-up demand for market-rate units. Yes, we will feel some impact from Lauren’s project, as well as from some in the LoHi area. But West Highland and Highland Square are very desirable areas. I do think the demand will far out-strip the supply of new apartment communities coming online.”
Jeff Hawks, an apartment broker and principal of the Denver office of Apartment Realty Advisors said that if RedPeak had decided to pull out of the deal because of neighborhood opposition, other apartment developers would be standing in line to buy the land.
“I could sell that dirt all day long,” Hawks said last week and elaborated on his previous comment this morning. “If you look at all of Denver, the apartment land most in demand would be in the Highland/West Highland areas, with the possible exception of Cherry Creek, although most of the new product in Cherry Creek tends to be condos. But to have land in the heart of Highland Square could arguably be the single best site available anywhere in the Denver metro area.”
He said if the land were purchased by what is known in the industry as a “merchant builder” - a group that builds apartments, leases them and quickly sells the completed project – it would want to construct the maximum number of units allowed under the zoning.
“Historically, most merchant builders do build to the maximum size and density allowed under the zoning, because that allows them to maximize their profits. If this land were available, I think it would be 50-50 whether it would be purchased by a merchant builder or another local company like RedPeak that planned to hold it for the long-term.”
Lichtenfels said that RedPeak already has received a number of unsolicited emails from people interested in renting units in Highland Square. “We haven’t started our pre-leasing or marketing programs yet, because the opening is just too far away. We don’t know if they will still be interested when it opens. But we are starting to keep a list.”
Contact John Rebchook at JRCHOOK@gmail.com