Land demand along the Front Range is through the roof.
In fact, there has never been a time in Denver area history when there has been so much interest to buy property for residential and commercial development, according to veteran land broker Mike Kboudi.
“Demand is hot,” said Kboudi, a senior managing director in the Denver office of Cushman & Wakefield.
“And it is not just one product type. There is interest in buying properties across every product type,” added Kboudi, who during the past five years alone has sold more than 3,000 acres worth more than $215 million.
Such a widespread interest in land “is not common at all,” he said.
And when Kboudi says all types, he is not kidding.
“There is demand for land to develop offices, retail, for-sale residential, apartments, hotels, industrial and even specialized interest like churches,” Kboudi said.
Kboudi will join 15 other land experts to discuss every aspect of the ongoing land grab later this month.
The 2018 Residential & Commercial Land Development Conference & Expo will run from 7 until 11:45 a.m. Aug. 23 at the Hyatt Regency Aurora Denver Conference Center.
The conference, sponsored by the Colorado Real Estate Journal, is expected to draw 500 or more people, making it the largest land and development conference in the Rocky Mountain region this year.
Kboudi said the robust land market is a reflection of the strong local economy.
“A lot of people are moving here and once they are here, they don’t ever leave,” Kboudi said.
Interestingly, despite the demand for dirt, land prices themselves, outside of downtown Denver, have not experienced a huge increase in pricing, he said. That’s because the cost of entitling land and labor costs are rising at least 10 percent each year, he said.
“You just can’t build anything inexpensively anymore,” Kboudi said. “And when you take into consideration the labor shortage, take into consideration fees and the entitlement process, those upward pressures on development put downward pressure on the land itself.”
Considering the strong demand for land, at first blush it might seem somewhat surprising that the $50 million deal to buy 432 acres in Louisville that formerly housed the Storage Technology Corp. campus recently collapsed. The owner of the property, Phillips 66, has put the land back on the market after the deal by California-based Bancroft Capital did not close.
But Kboudi said that is kind of an outlier deal and not representative of the entire market.
“It’s not really surprising to me,” that the sale didn’t close, Kboudi said.
“It was a very expensive deal,” and the land was being marketed as a site for the second Amazon headquarters, he noted.
“It’s really just speculation on my part, but based on my experience” as a land broker, the buyer backed out of the deal because it isn’t landing Amazon, according to Kboudi.
“I wouldn’t even venture a guess,” on the likely next buyer of the huge site, which is strategically located because of its proximity to the U.S. 36 corridor and Boulder, he said.
“Ideally, I think you would want to see some mixes of uses on the site, including revenue-generating retail, maybe some office and some residential, if it is allowed,” Kboudi said.
In addition to Kboudi, others participating in the CREJ land conference will include:
- Steve Schwab, managing principal, Cushman & Wakefield;
- Jeffrey Whiton, CEO and executive vice president, Home Builders Association of Metro Denver;
- John Covert, regional director – Colorado/New Mexico, Metrostudy | A Hanley Wood company;
- Chad Murphy,director, Hines;
- Linda M. Purdy,vice president, Colorado Division, Richmond American Homes;
- Jeff Willis, president/owner, Berkeley Homes;
- Chris Presley, president, Epic Homes;
- Jeffrey Kullman, senior vice president, Michael Baker International;
- Ferdinand “Ferd” L. Belz II, president, LC Fulenwider Inc.;
- Steven C. Mulhern, senior vice president, Coventry Development Corp.;
- Rhys Duggan, president, CEO and managing partner, Revesco Properties;
- Chris Waggett, CEO, D4 Urban LLC;
- Jay Hardy,president, Brinkman;
- Wade Fletcher, managing director, Cushman & Wakefield;
- Chad McWhinney, CEO & co-founder, McWhinney; and
- Jim Capecelatro, senior managing director, Cushman & Wakefield.