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Forest City being sold

Forest City
Forest City developed Stapleton, one of the largest mixed-use redevelopments in the U.S. Forest City is being sold to Brookfield Asset Management.

Forest City has been a force in Denver for the past two decades.

In 1998, the city of Denver named Forest City, now a real estate investment trust, the master developer of the former Stapleton International Airport.

Stapleton is one of the largest urban infill redevelopment projects in U.S. history,” crowed the Cleveland-based Forest City Realty Trust Inc. at an analyst presentation earlier this year.

Indeed, Forest City backed up its claim with a summary of completed development at Stapleton:

  • 6 million square feet of retail,
  • 393,000 sf of office,
  • 3 million sf of “other commercial,”
  • 1,748 completed apartments,
  • 515 apartment units under construction and
  • 449 acres of owned land and 312 acres of land controlled through options.

“Plans for Stapleton include more than 12,000 homes and apartments, 3 million square feet of retail and 10 million square feet of office, research, development and industrial space,” Forest City reported at the Citi Global Property CEO Conference.

Forest City

Northfield at Stapleton is a bustling retail destination. Forest City is being sold to Brookfield Asset Management for $11.4 billion.

At a separate investor conference this year, Forest City noted at full build-out Stapleton will encompass 4,700 acres, or 7.5 square miles, which, by the way, is about 52 percent the size of Manhattan.

“Stapleton is expected to be home to 30,000 residents and 35,000 workers when completed,” Forest City noted.

A Denver Post article recently noted that Forest City is wrapping up its residential lot sales to builders and has “shifted its focus entirely to commercial developments.”

But what the Post story didn’t mention is that most of the commercial development likely will not be completed by Forest City.

Although it has received little to no fanfare in Denver, Forest City is being sold.

Forest City on July 31 accepted an $11.4 billion offer by Brookfield Asset Management Inc. to buy Forest City.

In addition to Stapleton, Forest City owns 18,500 apartments and more than 10 million sf of office, retail and life-science space across the country. Forest City traces its roots to 1920, when it was started by members of the Cleveland-based Ratner family.

Forest City

Shown is the Aster Town Center at the mixed-use Stapleton, developed by Forest City, which will soon be part of Brookfield’s real estate empire.

Many of the projects are “transit-oriented,” with mixed uses of apartments, retail and offices, which is “exactly our sweet spot,” Brian Kingston, chief executive of the Brookfield Property Group recently told the Wall Street Journal.

Of course, Toronto-based Brookfield, like Forest City, is no stranger to Denver.

Brookfield Asset Management is in the process of buying the two-thirds stake in mall giant GGP Inc. that it did not already own. GGP’s portfolio includes Park Meadows and Southwest Plaza.

And Brookfield Asset Management is the “ultimate parent” of Brookfield Properties, even though Brookfield Properties is separately traded from Brookfield Asset Management.

In downtown Denver, Brookfield Properties’ portfolio includes two trophy office towers: 1801 California and the 56-story Republic Plaza, the tallest building in Colorado.

Forest City is not only a force in Denver because of its size and for putting the redevelopment of Stapleton on the map but also for its early and continuing commitment to sustainability.

In 2006, when I was the real estate editor of the Rocky Mountain News, I moderated a panel discussion that included Jon Ratner, who then lived in Denver and was the sustainability czar for Forest City.

Forest City

Jon Ratner

Ratner kicked off the conference with Bob Dylan’s gravelly voice spitting out the Joni Mitchell lyrics: “They paved paradise and put up a parking lot … Don’t it always seem to go, that you don’t know what you’ve got ’til it’s gone.”

As Dylan sang “Big Yellow Taxi,” Ratner showed a slide of a pristine mountain peak, sliced by giant evergreen trees and dissipating clouds with the word “Paradise” displayed on a large screen.

Ratner said that development does not have to be equated with sprawl, as many people think. Stapleton, for example, is the antithesis of sprawl in his book.

On the other hand, he confessed that many of the people in his Denver office at the time despised the song “Big Yellow Taxi” because they saw it as an antidevelopment anthem.

“But I love it,” Ratner told me a dozen years ago. “And Dylan is my favorite singer.”

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 JRCHOOK@gmail.com or 303-945-6865.

Kris Oppermann Stern is publisher and editor of Building Dialogue, a Colorado Real Estate Journal publication, and editor of CREJ's construction, design, and engineering section, including news and bylined articles. Building Dialogue is a quarterly, four-color magazine that caters specifically to the AEC industry, including features on projects and people, as well as covering trends…