As new apartments open in Highlands, small investors are happy as Allanté sets sights on rental project at 39th and Tennyson.
Fourteen months ago, when Denver’s housing picture was nowhere near as clear as it is now, developer Darell Schmidt of Allanté Properties set out to recruit a few dozen small investors to join in an apartment/retail project at 38th and Julian in The Highlands. Some 43 did so, investing from $100,000 to $500,000 each.
That was then. Now Schmidt’s Highland Place project at W. 38th and Julian Street is coming into its grand opening with its sharp looking units already 56 percent leased, plus 52 percent of the retail space spoken for; while Schmidt, who developed big suburban tracts for 30 years before moving into the urban center, is looking at his next site.
And what a site it is.
In mid-March a broker approached Schmidt on a lot at W. 39th and Tennyson Street, a block north of old Elitch Gardens. Anybody watching Highlands knows that area is directly adjacent to the fastest growing restaurant scene in Denver, already with some very successful brew pubs and chef-inspired restaurants including Axios Estiatorio, chophouse-styled Block & Larder, The Royal (burgers), plus venerable DJ’s Berkeley Café and Kyle’s Kitchen, two sushi places, and your choice of coffee bars, including Starbucks.
The new Tennyson site in Berkeley fits Allanté’s business model to a tee: “Walkability is so important to Millennials,” Schmidt said. The under-30 set, he notes, likes walking to grocery stores (Sprouts is already at Elitch, another natural grocer is on the way, and both Kings and Safeway are within a mile) and eats out most nights of the week – not to mention their affinity for a walkable bar scene. Schmidt has investor positions available on the new building, and is talking with prospects now.
The focus on smaller investors was a motivating factor in play when Schmidt and Allanté did a first rehab project two and a half years ago – an apartment makeover called Fitzsimons Place next to the Anschutz/Fitzsimons campus. Small investors who got in on that building, Schmidt says, have seen a 26.81 percent annual return on their investment. Schmidt says Highland Place is on track for similar performance: “It couldn’t have gone better,” Schmidt says. “This investment model is excellent for the passive investor who wants high returns but doesn’t have time or knowledge to invest on their own.”
Tennyson Place will have 80 class-A apartments in a five story building, and will feature private underground tenant parking, an attractive exterior with a first floor club room with fitness center, a front porch deck on Tennyson Street, private terraces on floors 2, 3, and 5, and a Sky Deck with two fire pits, barbecue bar and outdoor Lawn Theater. Once complete, Schmidt expects rapid absorption.
At a moment when a national survey by Rent.com finds Millennials are spending 40 percent of their incomes on rent, Allanté set aside 90 percent of the units at Highland Place for studios and ‘micro-units’ – some as small as 390 square feet. “Nobody really wants a roommate if they can afford to live alone,” Schmidt says; and sure enough, the smaller units were the earliest to lease up at Highland Place, way in advance of opening.
“Smaller is better,” Schmidt says. So at Tennyson, he’s having Oz Architecture allot 90% of the units to those singular sizes – something that will keep this project in range of younger renters who are being priced out by Denver’s rapidly rising rents. You can talk with Darell Schmidt about investor positions in Tennyson Place (on the web at GoInvestDenver.com, or call 303-359-1210). You can also drop by Highland Place to see the quality of that project – on W. 38th and Julian Street.