Getting your player ready...
How willing are smaller investors this year to look away from the stock market toward real estate investments, as the national market shows signs of a comeback? Very willing, says veteran developer Darell Schmidt, who has taken calls from over a hundred potential investors in the past five weeks concerning one mixed-use residential/retail project he’s doing in Highlands.
Schmidt, president of Greenwood Village-based builder/developer Allanté Properties, is pioneering new investor models that encourage smaller investors to join in real estate projects, in addition to a project’s major bank financing. Solicitations for those kinds of investments are allowed by new SEC regs released last year – helped along by information technology that makes it much easier for investors to research a developer’s background and the project potential, and track its progress during construction. That’s the kind of situation Allanté is creating with Highlands Place, a mixed-use project at W. 38th Avenue and Julian Street, six blocks north of Highland Square and its restaurant row. The project, now at foundation stage, offers 68 Class-A apartments in conjunction with an 11,000 square foot main-level retail space, designed to appeal to restaurateurs as well as other commercial tenants. In a neighborhood showing lots of activity (Panera Bread just opened across W. 38th from the site) Allanté is putting major emphasis on parking – dedicated underground parking for residents, as well as sizeable ground level parking for retail tenants – in a part of town where lack of parking is often a sole downside for competing properties. “Highlands is in a hot area with rising rents and declining vacancy rates,” Schmidt says. “Our project shows fundamentals that could generate nice returns for investors, ones that can be high compared to other investments.” The strategy is already proving successful, Schmidt notes. The initial offering has already yielded a sizable small-investor component, with $100,000 being the minimum size. Based on attracting that additional capital, Allanté has been able to attract a major lender to the project with below-market interest rates. Meanwhile, Denver’s scene shows growing numbers of opportunities that Allanté is scrutinizing for similar projects, according to Schmidt’s son Darren Schmidt, who began working for the company 15 years ago while he was still in high school – and is now involved in project management and development planning for the company. Twenty years ago Schmidt’s Falcon Homes built major subdivisions in Stonegate, Highlands Ranch and Ken Caryl; but during the interim refocused on boutique-size projects in urban redevelopment zones. Allanté did such a project next to the Fitzsimons medical campus last year, a makeover of a 99-unit apartment carried out with lending by Steele Street Bank and Trust.720-529-2999/retail leasing WEB: Mark Samuelson writes on real estate and business; you can email him at mark@samuelsonassoc.com.You can see all of Mark Samuelson’s columns at DenverPost.com/RealEstate.
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