At the heart of conversations about the Breakers Resort with the original developer as well as the new majority owner, the discussions always end up acknowledging an emotional connection to the project. The property, which began with a tumultuous, undefined start, gradually grew into a labor of love and a vision for other multifamily communities to follow. But as the development world caught up, the Breakers Resort must begin its next stage.
This October, the Breakers sold to Pensam Residential and its partners for $350 million. With the original developer, Koelbel & Co., staying on as an owner, a partnership was formed over an appreciation for the site’s history and an eagerness for what awaits it as they embrace the latest iteration of a lifestyle community.
“In addition to it being a tremendous investment, there was definitely some emotional connection to the beginnings and the history of the property and wanting to play a part in the future of it,” said Mike Stein, Pensam Residential principal.
The Makings of the Breakers
Koelbel & Co. began acquiring the high-density-zoned ground in the late 1970s, during the condominium craze. But as momentum built and plans progressed to develop condos on the land, the market was rocked by the oil crash of the 1980s, said Walter “Buz” Koelbel, company president. To make matters worse, thousands of foreclosed HUD condo units began flooding the market.
The Koelbel company found itself sitting with 190 acres of land, which included a 60-acre lake in a somewhat no-man’s land location with no concrete plans. However, a new vision came to Koelbel on a tour of a 1,700 unit apartment property in Atlanta. He realized they could do something similarly unique in Colorado.
Immediately upon returning the Denver, Koelbel set out to find a partner. Most developers didn’t want to wade into a joint venture, and with the weak state of the market and a pull of intrigue into what the property could become, Koelbel wanted to stay in. He found his partner in Al Feld, founder and president of The Feld Co., who was bored with the present day’s “average apartments” and was eager to focus his design-oriented skills on something new and different. Together they set out to push the envelope in terms of what people expected to see in an apartment in Denver.
While the process was far from over, a vision began to take form. “Because it had a 60-acre lake, which is obviously one of the big, unique amenities and catalysts to the whole property, we thought we could do something much higher end and different than the normal apartment projects,” said Koelbel.
The location, at the time, was rather marginal, Koelbel said. So to further set the community apart, they built a 26,000-square-foot clubhouse on the lake. “It became quite a novelty, to the point that we literally had to go to appointment-only for rentals because people wanted to come out and see what these two young guys were doing out here in this hybrid location,” he said. “It got a lot of exposure, and we started seeing some pretty good success, which validated that we really could create something unique and special if we did the right kind of apartment units.”