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Developers shy away from buying home

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Highlights:

  • Only one developer bid on mansion overlooking Denver Country Club.
  • Sonja Leonard Leonard believes other developers were scared off.
  • Conservation Fund stands to lose well into six figures because of lack of developer bids.

A number of developers did not make bids for a large home on six city lots overlooking the Denver Country Club, because they feared opposition from neighbors and Historic Denver Inc., according to the listing broker.

Sonja Leonard is listing the home at 101 S. Humboldt St. on behalf of the Conservation Fund.

Developers were scared to bid for this home listed for $2 million on behalf of the Conservation Fund.

Developers were scared to bid for this home listed for $2 million on behalf of the Conservation Fund.

The 5,198-square-foot home, donated to the Conservation Fund by the late Helen “Prue” Grant, was priced at $2 million.

“None of the bids were high enough for the Conservation fund, so we are going to continue marketing,” said Leonard, who was listing the home for the non-profit group for a 1 percent commission.

“Our problem is that developers or folks who want to tear it down face a huge obstacle in a neighborhood protest and in Historic Denver promising to jump in the minute a demolition permit is pulled,” she said.

Leonard said neighbors and Annie Levinsky, the executive director of Historic Denver, told her they planned to try to save the home, which lacks a historic designation, if a demolition permit is issued by the city.

Levinsky, however, said that is not the case as far as Historic Denver’s role.

“I don’t think we would,” seek a historic designation, Levinsky said. “That is not to say we want to see it demolished. We don’t think it should be demolished.”

In fact, Historic Denver could help a buyer get tax credit money to help an owner-occupant renovate the building, she said, which could help “level the playing field” for any additional amount a developer might pay.

Also, Levinsky said she is not convinced the possibility of a historic designation is keeping developers away, as they often pursue buildings despite protests from neighbors and preservationists.

She also said that Historic Denver, Leonard  and the Conservation Fund share a lot of the same values.

“We know that Sonja would like to preserve the home,” Levinksy said. “The Conservation Fund certainly shares a lot of the same values with Historic Denver and we recognize they do a lot of good things. We don’t want to blind side anybody. We don’t want to put anyone in a negative situation.”

In December, the City Council made it more difficult for citizens to seek Landmark status for properties they do not know. The new ordinance, among other things, requires a minimum of three Denver residents or property owners, to seek the designation. Far more neighbors than that oppose the demolition of the home, Leonard said.

Leonard she said she believed the existing home could be razed and the parcel could include three new homes. The home was designed by Denver architect Thomas Moore. Victor Hornbein, another well-known architect, also was involved with the design of the home after it was built.

While about a half dozen developers looked at it, only one, a Texan, made an offer. That offer, she said, had a number of contingencies, such as the ability to allow him to move forward on the demolition, before he would pull the trigger.

A lot of developers were blind-sided by Historic Denver,” she said. “It just scared the living daylights out of them.”

Leonard said she did receive a number of offers for the home and it is possible that it may be placed under contract shortly, although a developer would be willing to pay a higher price.

“I think it will be sold by Sunday,” said Leonard, who held open houses for the property during the previous two Sundays, which together drew about 550 people.

“All of the offers came in within $100,000 of each other,” she said. “We took the one, which was not the highest, but had the fewest contingencies, and made a counter offer. We’ll see what happens.”

She said she can not be specific about the dollar amount of the offers.

Leonard said the irony about the opposition from Historic Denver is that she loves to preserve buildings and if she had her druthers, the home would be saved from the wrecking ball.

Annie Levinsky and I are on the same page,” Leonard said. “I am the queen of preserving homes.”

On the other hand, she said that the Conservation Fund could lose well into six figures by the inability to sell to a developer, which means it has that much less money to spend on buying and preserving open space in Colorado.

“We’re talking about losing several hundreds of thousands of dollars. Is that fair? I think some form of compensation should come from the city or Historic Denver or the National Trust or someone, when you are leaving that kind of money on the table.”

Leonard said she has run into this kind of problem before.

“A number of years ago, I had a home in northwest Denver under contract from $750,000 (that was going to be razed) and when the neighbors got wind of it and fought it, I think he ended up selling it for $450,000. That was a big loss for him.”

Leonard said that while a number of neighbors near the 101 S. Humboldt St. home are opposed to having a developer demolish it, they are happy to have the proceeds fund a worthy cause such as the Conservation Fund.

“They like the idea that it is not some rich guy making a buck off it.”

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Interested in buying a home in the Country Club area? Please visit COhomefinder.com and 8z Real Estate.

Have a story idea or real estate tip? Contact John Rebchook at  JRCHOOK@gmail.com. InsideRealEstateNews.com is sponsored by Universal LendingLand Title Guarantee and 8z Real Estate. To read more articles by John Rebchook, subscribe to the Colorado Real Estate Journal.