Downey – Disney influence in Denver

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Downey
Tim Downey, the CEO of Southern Land Co., recently attended the official grand opening of Centric LoHi.

Downey and Disney.

Tim Downey is a huge fan of Walt Disney.

Downey, the founder of Nashville-based Southern Land Co., even knew that Walt Disney was a major investor in the former Celebrity Lanes, a massive entertainment center with an 80-lane bowling alley, indoor swimming pool and restaurants that once stood at South Colorado Boulevard and East Kentucky Avenue in Glendale.

“When I started Southern Land Co. 37 years ago, I wanted to build apartment buildings the way Walt Disney built Disneyland. I wanted to make apartments fun,” the 58-year-old Downey told me last week while in Denver.

Downey was here for the official grand opening of the 303-unit Centric LoHi apartment building at 2525 18th St.

Downey
Tim Downey at Centric LoHi

Centric marks Southern Land’s entry into Denver. It has three other communities on the drawing board in the Denver area:  RÊVE Boulder, with 244 rental units, 24,500 square feet of retail and restaurant space, and 108,700 sf of office space; a 316-unit apartment building at East 17th Avenue and Pearl Street in Denver’s Uptown neighborhood; and a 1,100-lot, master-planned single-family home community on about 500 acres in Erie.

The Erie community is so new that it doesn’t yet have a name.

The homes likely will be priced from the mid-$500,000s to the mid-$600,000s.

I asked Downey if he could imagine some residents eventually moving to one of the homes in Erie.

“I think that is quite likely,” Downey said. “I think as millennials get older and start having kids, they are going to move to the suburbs. Then, I think a lot of them could move back to one of our urban apartment communities when they are older and are empty nesters. Everything goes full circle.”

Southern Land typically builds 25 percent of the homes in its master-planned communities to “set the architectural bar” and sells the remaining lots to homebuilders. The Erie community also will have a town center.

“Our site is right on the Boulder County line,” Downey said. “It’s in Weld County, but just on the other side of Boulder County. It seems everyone from Boulder is moving to Erie because it is so close, yet far less expensive.”

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Centric LoHi sports a saltwater swimming pool.

Downey had been interested in developing a luxury apartment community in Denver for several years before he cut a deal to buy what was then the headquarters for United Way in LoHi. Southern Land bought the site for $10 million in 2013, according to public records.

“United Way needed the money from the sale to build their new place, so we gave them two years of free rent to find a site and build their new headquarters,” Downey recalled.

“It seems like it has taken forever” to get off Centric LoHi up and running.

While the official grand opening was this month, Centric LoHi opened its doors for its first residents in early September.

Three months later, it is 30 percent occupied.

So far, the vast majority of the residents at Centric LoHi appear to be from out of state, “although a year from now, when we are 95 percent leased,” more accurate demographic results will be available, Downey noted.

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Denver’s skyline is visible from the deck of Centric LoHi.

“It’s mostly transplants,” said Matthew Stewart, the property manager at Centric LoHi. “So far, it is close to 90 percent. We’re seeing people coming from New York, San Francisco and Chicago. Chicago is our No. 1” city where residents hail from.

Many of the residents are in accounting or are consultants. “We also have a number of people who sold condos in other cities and have moved to Denver and are looking for jobs,” Stewart added.

The monthly rent for the smallest unit, at 496 sf, starts at $1,429. Most of the rents are in the in $1,800 to mid-$1,900 range.

Before Stewart arrived in a meeting room at Centric LoHi, I asked Downey for his favorite feature of the apartment community.

“I would have to say it is the courtyards,” Downey said. “We’ve got five courtyards (including the pool and rooftop decks) and they are all set up for outdoor living. They all have firepits and and those firepits put off a lot of heat. So you could be outdoors anytime, except maybe when it is raining. If I lived here, you would always find me in a courtyard.”

His second favorite amenity: LoHi.

“I think the neighborhood itself is a great amenity,” Downey said. “There are so many great restaurants and recreational opportunities. And you can easily ride your bike into downtown. But LoHi feels more like a real residential neighborhood than LoDo or Union Station. And you don’t have the traffic congestion and noise that you find downtown.”

Centric LoHi itself has two restaurants: Marcella’s and the Bindery, an eatery, market and bakery.

I asked Downey if it is unusual for an apartment community to have two restaurants.

“Honestly, I think it is more of a function of the LoHi neighborhood than this being an apartment building,” Downey said.

I later asked Stewart what he thought were the top amenities at Centric LoHi.

Although he wasn’t privy to Downey’s response, he also said LoHi itself is a top draw for many.

“Especially when people are coming from outside of the area, they have heard of LoHi and really want to live here,” Stewart said.

“I think most of our residents, if they looked at any area other than LoHi, it was probably RiNo,” he said.

Others were drawn to Centric LoHi for the great views of Denver’s skyline or the saltwater swimming pool. For others, it is free events like beer and popcorn on Monday night, cheese and wine, and free massages from 5 to 7 p.m. on Fridays, free breakfast from 9 a.m. until 11 a.m. on Saturdays, and yoga and Pilates instructor-led classes.

Downey
A nighttime view of Denver’s skyline from Cenric LoHi

While other apartment developers increasingly are offering these kinds of in-house perks, they’ve long been the standard at Southern Land, thanks to Downey and his longtime business idol, Walt Disney.

“I think these kind of things have long distinguished us from many of our competitors,” Downey said.

“We try to make our apartment communities a bit like Disneyland.”

And he will always try to improve them.

“One of my heroes is Walt Disney and he once said that Disney World would never be done, there’s always something to do to make it a little bit better. That’s how we feel about the buildings we own.”

 

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.

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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