Crews demolishing the former Greyhound bus station at 1055 19th St. in 2021. (Businessden file)
The development firms that own the former Greyhound block in downtown Denver have made one of the largest requests of the Downtown Development Authority.
Chicago-based Golub & Co. and New York-based Rockefeller Group requested $64.5 million in March to help construct a 36-story tower with apartments and hotel rooms on the block at 1055 19th St.
In their application to the DDA, which was obtained by BusinessDen after being partially redacted by the city, the two firms said the money is “needed to bridge the gap between the current cost to build a high-rise tower and the minimum yield expectations currently held in the private investment space.”
“Investment capital for ground-up development seeks a specific yield on cost in order to approve new development projects,” the companies wrote. “The reality is, the current market rent per foot in the Denver MSA is far too low to justify any new high-rise buildings, and this will continue to be the case for the foreseeable future.”
Their application is the only one submitted to the DDA that proposes a new building.
Executives at Golub and Rockefeller didn’t respond to requests for comment.
The two firms bought the full city block for $38 million in December 2020 from bus company Greyhound, which moved operations from there to Union Station that same year. The two firms demolished the bus station the following year.
The lot has sat fenced off and unused ever since, while the two firms have worked on their development plans, which call for two towers. The first would be 650,000 square feet, with 170 hotel rooms on the first six floors and 391 apartments above that. The second would have a similarly sized office tower.
The $64.5 million the firms hope to get from the DDA would go toward the first tower.
“Given the current market, the ownership group has proposed to phase the development, putting the office building component on hold and constructing the residential and hotel building in the near term,” the companies wrote in their DDA application.
Greyhound’s bus station at 1055 19th St. in 2019. It has since been demolished. (BusinessDen file)
The DDA is a city affiliate that has $570 million in bond dollars to spend on revitalizing downtown, where office vacancy nears 40% and years of construction prompted many retailers along the 16th Street Mall to close.
Since July, the DDA has approved $166 million in spending, although the Denver City Council still needs to sign off on most of it. Nearly all the DDA funding is being made in the form of low-interest loans.
The funding request for the Greyhound site has not been discussed in a public meeting.
As of mid-November, 84 applications to the DDA had requested a total of $887 million in funding — more than the available funds — according to a presentation to the organization’s board. Applications are still being accepted.
So far, the DDA has focused on projects along the 16th Street Mall, as well as historic buildings, according to Bill Mosher, the city’s chief projects officer. The application for the Greyhound block involves neither.
The only other company to request more money from the DDA as of mid-November was Vertikle Enterprises, which submitted multiple applications the largest of which seeks $188 million.
Thursday: While the DDA has already approved loans for three downtown office-to-residential conversions, several more developers have requested funds.
Read more: LoDo landlords look to sweeten downtown with Museum of Ice Cream
Crews demolishing the former Greyhound bus station at 1055 19th St. in 2021. (Businessden file)
The development firms that own the former Greyhound block in downtown Denver have made one of the largest requests of the Downtown Development Authority.
Chicago-based Golub & Co. and New York-based Rockefeller Group requested $64.5 million in March to help construct a 36-story tower with apartments and hotel rooms on the block at 1055 19th St.
In their application to the DDA, which was obtained by BusinessDen after being partially redacted by the city, the two firms said the money is “needed to bridge the gap between the current cost to build a high-rise tower and the minimum yield expectations currently held in the private investment space.”
“Investment capital for ground-up development seeks a specific yield on cost in order to approve new development projects,” the companies wrote. “The reality is, the current market rent per foot in the Denver MSA is far too low to justify any new high-rise buildings, and this will continue to be the case for the foreseeable future.”
Their application is the only one submitted to the DDA that proposes a new building.
Executives at Golub and Rockefeller didn’t respond to requests for comment.
The two firms bought the full city block for $38 million in December 2020 from bus company Greyhound, which moved operations from there to Union Station that same year. The two firms demolished the bus station the following year.
The lot has sat fenced off and unused ever since, while the two firms have worked on their development plans, which call for two towers. The first would be 650,000 square feet, with 170 hotel rooms on the first six floors and 391 apartments above that. The second would have a similarly sized office tower.
The $64.5 million the firms hope to get from the DDA would go toward the first tower.
“Given the current market, the ownership group has proposed to phase the development, putting the office building component on hold and constructing the residential and hotel building in the near term,” the companies wrote in their DDA application.
Greyhound’s bus station at 1055 19th St. in 2019. It has since been demolished. (BusinessDen file)
The DDA is a city affiliate that has $570 million in bond dollars to spend on revitalizing downtown, where office vacancy nears 40% and years of construction prompted many retailers along the 16th Street Mall to close.
Since July, the DDA has approved $166 million in spending, although the Denver City Council still needs to sign off on most of it. Nearly all the DDA funding is being made in the form of low-interest loans.
The funding request for the Greyhound site has not been discussed in a public meeting.
As of mid-November, 84 applications to the DDA had requested a total of $887 million in funding — more than the available funds — according to a presentation to the organization’s board. Applications are still being accepted.
So far, the DDA has focused on projects along the 16th Street Mall, as well as historic buildings, according to Bill Mosher, the city’s chief projects officer. The application for the Greyhound block involves neither.
The only other company to request more money from the DDA as of mid-November was Vertikle Enterprises, which submitted multiple applications the largest of which seeks $188 million.
Thursday: While the DDA has already approved loans for three downtown office-to-residential conversions, several more developers have requested funds.
Read more: LoDo landlords look to sweeten downtown with Museum of Ice Cream
