Quote:
Originally Posted by WonderlandPark
Too bad Tabor II didn't make it out of the ground in this biz cycle. Otherwise, Denver is looking good.
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Very true, but I think it could be a good thing it didn't. The Denver market has not been over-built and remains strong. The contraction of the economy will mean the absorption of new space coming online will take longer than originally projected. As the economy hits bottom and slowly begins recovering over the next two years, the under-construction projects will fill up and their will be a shortage of office supply for a short while, as no new proposals are breaking ground.
If Callehan breaks ground on Two Tabor at just the right time, it will be completed at a time the economy is well into recovery, yet long before any competition completes any other projects. With it's key location, only blocks from Union Station on the edge of LoDo and a half block off 16th Street mall, this location has been rated one of the top 10 development sites in the nation.
The location is so good, that Callahan actually received financing for this tower in this credit crunch and recession and did so without an anchor tenant or any pre-leasing. The developer turn the financing down, with the belief that more favorable financing options will become available sometime in teh next few years.
With Union Station expansion being scheduled for completion in 2012, but it's office components not scheduled to come online until 2014, there will be a two year gap without major office space coming online in what is likely to be a high demand time. The original completion date of two Tabor was scheduled for 2010. A two or three year delay would bring this project to completion in 2012 or 2013.
meanwhile, the developer is moving forward with converting the existing food court (which will connect the existing tower with Two Tabor) into some ground floor retail and 2nd floor into the second Colorado Athletic Club downtown location. This will result in about 1,000 more weekday workers hitting downtown streets such as the 16th Street mall during lunch time. In other words, phase one is moving forward. Phase two is on hold, but the foundation and parking structure is already in place for the proposed tower--it will get built.