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When it comes to real estate, things actually aren't so bad here in Denver. Our guide to the myths and realities of the local market will show you why. Plus: How to refinance your mortgage, remodel on a budget, and rehab your IRA with real estate investments.
The Downtown Lowdown
Spire's unconventional business model preps for its ultimate test.
In 2007, Randy Nichols started a project that seemed risky at the time. By late 2008, it looked downright insane. At 14th and Champa streets, just over the right shoulder of the "Big Blue Bear," the Denver developer planned to erect Spire, a $175 million high-rise that, along with several other projects, would reinvent the city's downtown skyline. What's more, he planned to begin construction on the 496-unit building without doing presales, normally a standard procedure.
The whole thing almost fell apart in late summer 2007, when a German bank, Nichols' primary financier, got spooked by the then-nascent U.S. foreclosure crisis and pulled out of the deal. After several months of manic scrambling, Nichols cobbled together new funding, and since January 2008 Spire has risen from the ground and from the dead. The project is slated to open in late October or early November, a couple of months ahead of schedule.
Spire is one of several downtown high-rises that have mostly weathered the economic storm. The site at 1401 Lawrence was sold last year and now sits in limbo, but the Four Seasons hotel and private residences project at 14th and Arapahoe streets continues to shoot skyward, with a scheduled opening in mid-2010. Several other multiunit buildings in and around downtown also have opened since 2008.
Unlike the Four Seasons, whose units range from just under $900,000 to about $7.5 million, Spire's $210,000 to $1 million price point is targeting a more diverse clientele, and how quickly the building fills up will provide a barometer for Denver's downtown revival. Nichols is cautiously optimistic. "We'd certainly love to have a booming economy, everyone flush with cash," he says. "But I think we have a pretty compelling product, even in a down market, and maybe particularly in a down market, because people always have the need for housing. People may not be selling many multimillion-dollar units, but anyone can afford a $200,000 unit."
With 5,000 people on the mailing list for the building and sales having begun in April, Nichols has his fingers crossed. "Maybe we'll be able to sell all 500 units within 60 days," he says. "But maybe that's wishful thinking."