Block 162 is a 30-story office tower under construction at 675 15th St. in downtown Denver, which broke ground in June. With a 2½ year construction timeline, followed by 1½ years of lease up, the 595,000-square-foot property is 100 percent speculative. According to the project developer, Patrinely Group, the project has received tremendous interest but nothing can be disclosed at this time. USAA Real Estate is a partner of the project.
Patrinely Group has developed seven projects in Colorado, starting with ParkRidge Corporate Center more than 15 years ago, which consisted of three Class A office buildings totaling over 400,000 sf, and ParkRidge Office Suites, six free-standing office condos totaling 93,000 sf. ParkRidge was home to American Century’s western regional headquarters and was one of Patrinely Group’s first buildings to implement green design. More recently, the firm completed three apartment projects (900 units) around the metro area, which served as an entry back into the Denver market; however, the company is no longer active with those projects.
I interviewed Robert Fields, Patrinely Group’s president and CEO, about the Block 162 project.
Question: Why was Patrinely Group interested in developing an office tower in downtown Denver?
Fields: We believe in the strength of the Denver market and we (Patrinely Group and USAA Real Estate) thought the timing was right to deliver a new Class A office product in the central business district.
Question: What makes this project unique?
Fields: A unique feature of the building will be the 11th-floor sky terrace, which will have both indoor and outdoor amenities for the exclusive use of our tenants. The indoor area will have a fitness center, social lounge and conference meeting space, while the activated outdoor area will offer fire pits, fitness lawn (a grassy area ideal for exercise, such as yoga) and seating areas. The outdoor deck will be almost 15,000 square feet. Separating the indoors from the outdoors will be a 40-foot-wide operable glass wall that will open out onto the terrace. We think this will be a real differentiator. The gym is not tucked away on a low floor but instead will be elevated with great views and access to the sky terrace. This common area amenity is something currently not seen to this degree in the CBD. We think this is very attractive to tenants and their workforce.
This is a testament to the trend we are seeing with urban dwellers and workers. There is a blurred line between personal life and work life, and these amenities make for a great opportunity for our tenants to also conveniently conduct business when not at the office.
Our Midtown market location also offers great area amenities with a 24-hour component to the neighborhood. Over the past few years, we’ve seen the shift of momentum to this area … as evidenced by Hines, Polsinelli, Hilton, AC/Le Meridien and the ground adjacent to Denver Pavilions.
Question: Is the building 100 percent spec?
Fields: Yes. This demonstrates a couple of things. First is Patrinely Group’s unique access to capital due to the confidence of our investors in our ability to bring projects across the finish line. Second is our confidence in the Denver market.
Question: What were some of the challenges for this project, and how have they been addressed?
Fields: Block 162 is a complex urban site development. The building will be built to the lot lines, utilizing advanced shoring and excavation techniques as well as just-in-time delivery of construction materials.
The office tower is located in Denver’s historic downtown and is surrounded by several low-rise historic buildings. The project was designed to be iconic and fresh, while still fitting in contextually with the surrounding historic buildings.
There are design complexities of developing a podium building. We had to address urban site circulation issues relating to ingress/egress at peak arrival and departure hours; garage circulation in terms of width and bay depths, while maintaining full-size parking counts; and security of the vertical stacks of elevators and stairs – we have tackled those challenges successfully.
Question: What is the firm’s investment strategy once the project is completed?
Fields: Stay tuned. What I am able to say is that Patrinely Group has a long history with the Denver market and expects this relationship to continue and prosper.
Question: What type of tenants do you hope to attract, and how are you catering to those businesses?
Fields: We are seeing interest from corporate tenants in fields such as financial, energy, insurance, sales, tech, law and telecommunications. Firms are unique, and their office space needs to respond to the way their companies and employees work. Large floor plate, open-plan offices are extremely popular today as a way to encourage employee interaction and collaboration, and are especially appealing to the young professionals that companies are trying to recruit. Our column-free floor plates are larger than most CBD buildings and allow for 10-foot ceiling heights or more on every floor, which combined with the floor-to-ceiling glass will provide bright, fresh, open spaces that will appeal to tenants who desire modern, creative office layouts. Of course, the beauty of the building’s efficient design is that the floor plates are equally efficient for traditional office layouts because not all firms need or want large open layouts. Traditional firms, or those that require more privacy (such as law firms), will find our floor plates equally as flexible to adapt to their needs.
Question: What are your thoughts on the Denver office market in general?
Fields: We think Denver is one of the most vibrant markets in the country. Over the last five years, all of the Class A office buildings delivered in this market have been quickly absorbed. This speaks to the fact that Denver provides a unique offering to office tenants that has been incredibly well received by corporations from all over the country. Innovative firms that understand tenant expectations are only going to expand in the Denver market.