Amazon prime sites

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Amazon
The Fox North site near the Mousetrap, shown what it could look like in a decade. It has been discussed as one of the potential sites in Denver for Amazon's second headquarters. Credit: Tryba Architects

Amazon Prime. Amazon prime time in Denver, that is.

You know what I’m talking about.

Everyone in the Denver area is buzzing about the possibility that Amazon could plant its $5 billion flag – a second headquarters – in the Denver area.

The New York Times even opined that Denver is the best choice for Amazon HQ2. (That alone, of course, may have crushed Denver’s chances. Jeff Bezos, founder and CEO of Amazon, owns the Washington Post and may not like the NYT telling him what to do. Not to mention that Denver now has a big target on its back from all the cities competing for the 50,000 jobs Amazon would bring with its headquarters.)

Reading the Amazon tea leaves was among a wide variety of topics covered at last week’s 2017 Office Summit & Expo sponsored by the Colorado Real Estate Journal.

“There is a lot of talk about Amazon,” CREJ panel member Peter Culshaw said while pointing to a PowerPoint aerial photo of the built-out Denver Technological Center, where 45,000 people work and live.

“This is what Amazon is going to propose somewhere,” said Culshaw, executive vice president of Shea Properties, owner of the Denver Tech Center.

“They are going to create their own Denver Tech Center,” Culshaw said.

Now, you can quibble that Amazon’s next headquarters could land on a smaller, more urban footprint that has taller buildings than in the DTC, but the point is made.

Indeed, Amazon’s headquarters would employ more people than live in Littleton. Look at it that way, and what the online retail juggernaut is really creating is Amazon City.

Some panel members at the CREJ office conference opined that if you could move Denver to the Midwest or the East Coast, we would have the Amazon headquarters in the bag. They think Amazon’s next headquarters needs to be at least two time zones away from Seattle with shorter flights to Europe.

Indeed, a lot of observers think Toronto is the city to beat.

I don’t know.

Toronto is a great city, but it is colder than Denver, real estate prices are more expensive than in Manhattan, property taxes are high and they would have to repatriate Canadian dollars into U.S. dollars.

Some CREJ panel members noted that Denver, with an unemployment rate of only 2.4 percent, couldn’t fill all of the high-tech jobs demanded by Amazon.

Indeed, full employment is considered 4 percent, noted speaker Michael D. McNiven, managing director and portfolio manager at Cumberland Advisors.

And get this: The Information technology unemployment rate in the Denver-Aurora-Broomfield metropolitan statistical area is projected to be a negative 4.9 percent in August, when the data rolls in, according to the U.S. Bureau of Labor Statistics.

Last Friday was the deadline to submit a proposed site to the Metro Denver Economic Development Corp. and the Colorado Office of Economic Development and International Trade. The OEDIT will serve as the primary point of contact with Amazon.

Here are some sites I think would make excellent sites for Amazon, although I’m sure there are a lot more that would fill the bill.

The former Storage Technology campus in Louisville.

Last week I broke the story that Bancroft Capital will be paying $50 million for this prime development site.

With 432 acres to play with, I think it could blow the socks off Amazon. During non-rush hour, it’s a surprisingly short trip to downtown Denver and 10 minutes from all Boulder brings to the party. It’s off U.S. 36, served by a bus rapid-transit system, which some will argue is superior to light rail. It’s a straight shot to DIA.

The biggest downside is that Amazon has an insanely short deadline of Oct. 19 and Bancroft won’t even own the property until the first quarter of 2018.

Amazon
Bancroft Capital is under contract to buy the 432-acre site from Phillips 66 for $50 million. The gem of a property could shine if Amazon took it down as its next headquarters.

Fox North

Amazon
The 41-acre Fox North site could be expanded to 93 acres, making it even more enticing to Amazon.

As my Lyft driver took me to the CREJ office conference around 6:15 a.m. last Tuesday, I once again admired the downtown skyline view from the Mousetrap at the confluence of Interstates 25 and 70.

A decade ago, Ascendant Development put the former Denver Post printing press site near the Mousetrap under contact.

“We have patiently been waiting for the perfect campus user,” Graham T. Benes, principal of Ascendant told me last week.

It’s not a hard stretch to see why this site, called Fox North, would fit the bill for the Amazon headquarters.

“We meet all the qualifications and can’t beat out location at the intersection of the two major highways in the Western U.S. and a commuter stop a block away,” Benes said.

The site already includes a 320,000-sf building, which could easily be expanded to the 500,000 square feet that is on Amazon’s wish list.

And with 41 acres, the site can easily accommodate the 5 million square feet that Amazon will need, even without high-rise construction, Benes added. The rendering by Tryba Architects of what the site could look like when built out a decade from now is pretty impressive.

The site also has zoning for multifamily development to provide Amazon with plenty of employee housing.

Shown is the existing Fox North property. Photo credit: Tryba Architects.

And if that weren’t enough, Benes has other, adjacent property owners on board that are willing to kick in their land and more than double the site to 93.4 acres.

Nearby landowners joining forces to woo Amazon to the property include: The Salazar Family, Dufficy family, Heimbecher family, Ringsby family, as well as Brue Capital Partners and Littleton Capital Partners.

“As you can see, we show a three-phased approach,” Benes said. “There is no reason why these couldn’t all be taken down at once so that Amazon could control the market and land basis.  Most all of these landowners, like ourselves, have owned sites in the neighborhood for 10-plus years, so (the property) is at a much more competitive land basis than other parts of the city.”

There is no question that there are other prime sites in the metro area that would be a good fit for Amazon, such as the Jones District, being developed by Peter Coakley of the Opus Group, along the Southeast corridor, or the 41-acre site that was once part of the Gates Rubber plant near Interstate 25 and Broadway.

Without a doubt,  either the Bancroft Capital or Fox North site would not only be a great site for Amazon, but, more importantly, would serve as an Amazon City where creative, talented people would want to work.

As Tami Door, the CEO of the Downtown Denver Partnership said at the CREJ office conference last week, the partnership came to the conclusion a decade ago that attracting companies wasn’t the key to economic prosperity.

Far more important is creating a vibrant ecosystem where people wanted to live, work and play.

And if Denver wins the Amazon lottery, beating out cities and states that likely will put billions of dollars on the table, one of the big reasons will be because people want to live in Denver.

If you scratch the surface of just about any deal, there is a story behind it. The Rebchook Real Estate Corner looks at the what and who that make the Colorado commercial real estate industry spin every Tuesday and Thursday online at CREJ.com. The people behind the deals are passionate about what they do, whether they focus on offices, apartments, industrial, retail, land or lending. They also are passionate about their clients. Given the cyclical nature of commercial real estate, those who prosper in it have plenty of stories to tell. I hope to share them with you. 

This column includes news stories, in-depth looks at deals, profiles, Q&As and pieces on the latest trends. Contact John with story tips at [email protected] or 303-945-6865.

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