In this issue: Spring 2020

Feature

Developing Denver

developing-denver

Where the city is headed and why it’s equipped for the trip

The year is 2040 and you’re on I-25 near the University Boulevard exit. Screeeech. Hit the brakes. Are you driving? Probably not. Sure, you are in a car, but it may well be driverless. And that single innovation stands to change much more than just bad driving in Denver; it may reshape the city.

“Driverless mobility would be the biggest disruptor for real estate since the advent of the automobile,” said Jeff Engelstad, professor of the practice in the Franklin L. Burns School of Real Estate and Construction Management at Daniels College of Business. “Developers today are already thinking about how to change parking structures.”

Other impacts being floated include gas stations and auto dealerships becoming condos and retail shops, the cost of living falling because of cheaper transportation, suburbs growing due to easier commutes, and housing turning over less as elderly people stay in their homes longer. 

All of this just from driverless mobility. Also on the horizon are many more innovations—each of their waves will ripple through the Mile High City. 

It’s a future that Engelstad and other Daniels faculty predict will include more accessory dwelling units, tiny houses, micro apartments and multifamily dwellings. 

“When you see big projects like DIA, Union Station, FasTracks and others, [it shows] a maturity of leadership that’s rare to find across the U.S. in our current time.”

John Knott Jr.

On the commercial side, more innovative office space and lease structures will appear, as well as new and interesting uses for industrial space to accommodate same-day and drone deliveries.  

But can Denver withstand all the change? And if so, how? We put those questions to Daniels faculty members, who pointed to collaborative leadership, sustainability, learn-by-doing education and a diverse economy.

Better Together 

Engelstad said a pivotal advantage Denver enjoys is that real estate development is mostly a local business, meaning developers here care. “If you read their mission statements, they all talk about doing things right. That’s their attitude in Denver: ‘We want to do things right.’”

That’s key to Engelstad because, he said, the city will continue to grow mostly because of what brought so many people here from the start: the natural beauty. 

“Denver has attracted a lot of highly educated people to fulfill their dreams, and that comes with the added congestion, the affordability gap in housing and all the rest,” he said. “But the leaders here have a progressive mindset—they work together to solve those issues.”

John Knott Jr., an executive in residence at the Burns School and founder and chief executive officer of CityCraft Ventures, agreed. The most hopeful element of Denver’s future, he said, is the collaboration in its history.

“When you see big projects like DIA, Union Station, FasTracks and others, [it shows] a maturity of leadership that’s rare to find across the U.S. in our current time.”

Sustain the Change 

Something else that’s current is sustainability, and Engelstad said commercial developers are getting more thoughtful about it all the time. He added the topic is also gaining ground in residential circles. “They [developers] know neighborhoods have to be sustainable—less waste, [more] mixed use and people living, working and playing in their communities,” he said.

Another place he’s spotting the sustainability mindset is in his classrooms. “Students have changed dramatically over the last decade. It used to be those going into development just wanted to make a lot of money. Now they’re all about urban adaptive reuse, green—all of it, and they’re serious. Those in real estate today are here to change the world.” 

Hands-On Lessons

Those same students are learning how to apply cutting-edge technologies related to sustainability in real estate and construction to real-world issues, said Drew Mueller, assistant professor at the Burns School. For example, some students are currently retrofitting a house on campus with renewable energy while other students are employing innovative strategies to redevelop a Denver property.

One of those strategies, which Mueller teaches, is regenerative development. It lets students focus on positive outcomes for everyone in a system. Mueller said it’s being used to redevelop neighborhoods like Sun Valley just west of downtown Denver without gentrification while also addressing environmental concerns.  

Economic Diversity

Even though Denver has plenty of pluses, it still isn’t immune to economic downturns. But, according to Mac Clouse, a professor at Daniels’ Reiman School of Finance, Denver’s diverse economy (buoyed by technology, oil, gas, energy, tourism, agriculture, financial services, federal government services, biomed and health care) will keep it afloat. 

“If the U.S. economy begins to slow, Denver’s economic growth rate will fall by a smaller amount than the U.S. economy,” Clouse said. He also lauds Denver’s educated workforce. “It has been one of the reasons the city has attracted new and transplanted businesses.”  

And in 2040, it’s likely to be a workforce that’s particularly productive. It’ll be working—instead of driving—during its commute. 

Read four company executives’ answers to the question, “Why Denver?”

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