Published Expert Article
– by Esther Kettering, MBA, with Harper Davis and Paul Nora at Pinnacle Real Estate Advisors

DENVER CORRIDOR – The Denver stretch of W Colfax from Federal west to Sheridan experienced energetic redevelopment and renewal over the past 7-10 years. Buildings in that stretch of W Colfax were built in the early-to-mid 20th century. Many buildings were/are no longer functional or in such condition that remaining useful life stimulated opportunities for redevelopment. In 2013, relocation of the old St. Anthony’s hospital complex to Union Boulevard in Lakewood triggered a major master-planned redevelopment featuring both commercial and residential. Views and access to Sloans Lake attracted new residents and encouraged other new projects in the surrounding area.

LAKEWOOD CORRIDOR – From Sheridan west to Simms the building stock is mainly comprised of construction done in the last half of the 20th century. Those structures are not as old or as “ripe” for redevelopment as the part of W Colfax in Denver; however, lack of function and condition of many buildings is raising interest among qualified developers to meet demand for more housing and more relevant commercial space.
Delivery of RTD’s West Light Rail Line in 2013, combined with completion of several multi-family projects in both apartments & townhomes between 2016 and now, continues to build momentum. Larger parcels such as the former Sears, Target & Westland Mall sites of 4-10 acres have been acquired and developed by the big national/regional developers., predominantly for multi-family/apartment units. Great opportunities remain for local developers seeking 1- 4 acre sites or assemblage of much smaller properties. Lakewood’s current zoning along W Colfax accommodates redevelopment and encourages creativity.

INVESTMENT – In 2024, local investment has been vigorous. Considering 2024 projects with Lakewood’s W Colfax addresses alone, well over $40 million in private building permit value was booked before Q3 2024. Such investment portrays a strong and improving market! Historic (2014-2019) building permit values for the same area were in the $6 to 7 million range annually.

Notable 2024 projects include:

• W Colfax & Eaton – 72 multi-family units – $13.5 million
• Prestige Porsche Audi – Expansion to existing luxury auto facilities – $26 million
• Casa Bonita – Restaurant/entertainment venue rehab valued at over $20 million
• Embry Partners – Started project at former Sears for 354 new units – $66 million

CITY ENDEAVORS – On September 18, 2024, City of Lakewood acquired the former Reed Photo facility at 8000 W Colfax, a 21,500 square foot building, and established a City owned Navigation Center to facilitate housing and offer services to those seeking more permanent residences. The purchase demonstrates one more step towards community efforts to renovate and energize Lakewood’s W Colfax corridor. Check out the Envision Lakewood Team 2040 at www.CompPlan@lakewood.org

BUSINESS LICENSES & SALES TAX – Replacement of Target, Sears and Westland with multi-family housing has understandably resulted in a decrease in Business Licenses of about 6% (from 636 to now 596) over the last 10 years. Sales tax revenue generated in the corridor declined by nearly half from $20 million in 2014 to a projected $11.3 million by year-end 2024. This is a result of losing the big-box retailers to redevelopment. However, growth of retail and service businesses “follows” residential density and development. City of Lakewood has had the foresight to establish and promote a Mixed-Use zoning program that will eventually attract new businesses to serve the new residents and re-grow revenues.

RETAIL ENVIRONMENT – Recent and ongoing redevelopment has created volatility in the corridor’s retail landscape. From low vacancy of 2-4% prior to 2018, peaking at 11% in 2022/23, then low vacancy again of 6% by end of 2023, current vacancy in the corridor is reported at 10.4%. Net negative absorption temporarily affects vacancy as big retailers leave. But reported vacancy swings low again as big box retail buildings are razed, total square feet of retail inventory decreases, and retail space is replaced with new apartments. The good news is average rents have steadily grown over the last 10 years, now hovering at $18.50/SF NNN, with rent growth remaining steady regardless of vacancy swings.

LEVERAGE & OPPORTUNITY – Those with interests in this area have worked hard to create a variety of other advantages for business operators, developers and real estate owners in the Lakewood W Colfax corridor, including:

• 40 W Arts District – www.40westarts.org
• The West Colfax Community Association (“WCCA”) – www.westcolfax.org
• Lakewood West Colfax BID – Business Improvement District – www.westcolfaxbid.org
• Creativity Lab of Colorado – partners w/Rocky Mountain College of Art & Design – www.rmcad.edu
• Lakewood Redevelopment Authority – www.lakewood.org/Business/Reinvestment-Authority
• Colorado Enterprise Zone Program – https://oedit.colorado.gov/enterprise-zone-program

The new and improved W Colfax between Sheridan and Simms has a strong positive future but will take some time and “growing pains.”

The will of both old & new residents, along with business operators, and those loyal customers and patrons frequenting the variety of services and amenities the avenue offers, are dedicated to continual improvement!

Featured in the November 2024 Edition of the Colorado Real Estate Journal