When Michael Leccese came to Colorado Springs in June 2012, it looked like the city was on fire.
The executive director of Urban Land Institute Colorado had sojourned south from Denver during the Waldo Canyon inferno to participate in a national ULI panel evaluating Colorado Springs.
“It was a terrible situation. … The sky was so thick with smoke you couldn’t see very far. Emergency vehicles were scattered everywhere,” he told a room full of Colorado dignitaries and business people last week at the Gold Room.
“We thought, ‘Who’s going to come to this panel?’ We got to the Fine Arts Center and it was just packed. … I walked away thinking, ‘This is great, but they’ll never do any of this stuff. It’s too ambitious.’ Then we learned it’s all happening and we’d better come do a program down here. I really congratulate you on the ambition and being able to achieve so much in such a short time.”
Leccese made those remarks during ULI’s Colorado Springs Forward event on June 8. For the many attendees from northern Colorado, the event provided a first-time look at projects leading what many call a renaissance for downtown and beyond. Locals already familiar with those ambitions were treated to updates on the region’s economy, as well as the many projects both underway and planned.
Mayor John Suthers kicked off the program with an overview, saying the city, the nation’s 40th largest, was on a “very positive trajectory” and more populous than Miami, St. Louis, Minneapolis, Cleveland and Pittsburgh (not counting suburbs).
He discussed infrastructure issues and solutions, such as the recently passed road tax and the intergovernmental agreement signed with Pueblo County that will allow the Southern Deliver System to begin sending water to Colorado Springs, allowing for a half-century’s growth.
Suthers mentioned the city’s ranking as the No. 5 place to live in the nation, according to U.S. News & World Report. It was the only city in the top five with a perfect desirability score, he said.
The mayor talked about the growing impact of UCCS, a $400 million per year economic driver that is expected to contribute $1 billion within seven years, and also pointed to the growing cyber industry and Colorado Springs designation as Olympic City USA.
Still a bargain
Dirk Draper, CEO and president of the Colorado Springs Regional Business Alliance, provided an economic overview. Cost of living, he said, is 92.6 relative to a U.S. standard of 100, a decline from the previous index due to reductions in utility and transportation costs. Denver is 9.6 percent above the national average, a 17-point difference, he said.
Average rent here is $1,015 a month for a one-bedroom apartment. Draper said rent in the city is among the nation’s fastest rising.
“Folks, if you start with a low rate, small change makes a big difference,” he said. “We still continue to be 30 percent below the state average and 40 percent below Denver’s average rate for a two-bedroom of $1,750 a month.”
Median home prices have hit a new high at $262,000. That, however, is 34 percent below many Front Range communities, he said.
New jobs created in the county also hit a new high in 2015, at 9,000, Draper said.
“That’s the highest growth in a decade and a half,” he said, adding many of those jobs were in health care, hospitality and call centers.
Draper concluded highlighting the four areas of focus for the RBA — information technologies (to include cyber), aerospace and aviation, health engineering and sports.
A growing downtown
Susan Edmondson, CEO and president of the Colorado Springs Downtown Partnership, discussed the city’s core. She said downtown has the largest concentration of creative industries for a city its size, and explained the city has an abundance of urban parkland and trails, low commercial vacancy rates, and a “growing entrepreneurial culture.”
Incentives are one way that downtown attracts enterprise, she said, to include a Downtown Development Authority with tax increment financing capabilities. Downtown is 680 acres, and approximately 100,000 people live within a 3-mile radius. She said about 230,000 people live within a 5-mile radius.
Downtown plays host to about 4,000 higher education students, combining Colorado College and Pikes Peak Community College’s downtown branch.
CC was named the Most Innovative Liberal Arts College by U.S. News & World Report in 2015 and the third-most entrepreneurial by Forbes, she said.
The downtown workforce includes 2,300 businesses and about 17,000 employees, Edmondson said. Top industries include legal, finance, government, defense, tech transfer and creative.
Downtown has the highest concentration of locally owned restaurants in the Pikes Peak region, she said, with more than 90 percent of street level retail being locally owned.
Edmondson said, in the first quarter of 2016, downtown added 15 new street-level businesses, “far exceeding the pace from a year ago, and we have so much demand from restaurants that we don’t have the space to accommodate them. We’re working on that.”
A ‘P4’ project
Retired Lt. Gen. Michael Gould, superintendent of the Air Force Academy from 2009 to 2013, discussed the City for Champions projects, particularly the proposed AFA visitors center. Due to stricter security protocols following Sept. 11, 2001, visitors couldn’t easily access the current center, Gould said.
“Visitor count was less than half compared to before 9/11,” he said. “We wanted to build [a visitors center] closer to the interstate.”
Gould said the new center will be the result of a “P4” relationship.
“It’s public land at the Academy, public support from the state with [Regional Tourism Act] money, it’s private investment, and man, is it ever a partnership,” Gould said.
Using a modified enhanced lease process, the government set aside property outside the Academy’s gates for developers. A developer will build the visitors center and, with the remaining land, the developer can construct a commercial enterprise. Upon completion, the developer will gift the center to the Academy.
The center would be part of a 57-acre property east of the Academy’s north gate, and possible surrounding developments might include an indoor skydiving wind tunnel that could be used by both cadets and the public, and possibly the relocation of the campus planetarium, Gould said.
A Request for Qualifications was released May 24 and developers have until Aug. 5 to submit proposals.
Chris Jenkins, president of Nor’wood Development Group, talked about his goal to make Colorado Springs the “No. 1 middleweight city” in the country.
“We know, and ULI has shown time and again in its work across the country and the world, that cities are limited by the quality of their downtown,” Jenkins said. “They are the historical, governmental and cultural centers.”
Jenkins discussed his company’s already-announced urban apartment projects, to include a 172-unit multifamily development at Colorado and Wahsatch avenues and another planned project at Cascade and Moreno avenues.
Jenkins also discussed development around the planned Olympic Museum and Hall of Fame, and connecting the museum to the Pioneers Museum downtown and America the Beautiful Park to the west with “walkable, bikeable, people-centric — not car-centric” streets and development.
“We want to get on Google or Apple or Adobe’s list of cities where they’d want to locate their vendors or themselves in some capacity,” Jenkins said, via an emphasis on high design and place. “In the next 10 years, we’ll see a different Colorado Springs that will start to define the city as we know it.”
Ingrid Richter, economic development director of the O’Neil Group Company, talked about her organization’s Catalyst Campus project. The campus, which resides in the renovated Atchison, Topeka & Santa Fe railroad depot at the intersection of Pikes Peak and Colorado avenues, is now operational.
Richter said the O’Neil Group Company’s purchase of the station in October 2014 offered the opportunity to preserve a historic building and also fulfilled “a much broader vision,” she said.
El Paso County receives the most defense spending in the state, Richter said, with $4 billion coming to this county alone. She said, of the 298,000 military retirees in the state, 59,000 live in El Paso County.
“We are first in the nation for per capita aerospace employment and second in the nation in private aerospace employment,” Richter said, adding there are about 400 aerospace and defense companies in the state, making it the third-largest industry.
“So how do we use that knowledge and existing infrastructure to capitalize on economic development for this community?” she said. “One is cluster development, which is an organizing principle around regional economic strengths and weaknesses. The RBA worked to capitalize on that and understand the assets of the community, including aerospace, defense and cyber becoming an economic development program for the community.”
The campus is also home to a 501(c)3 that promotes commercialization and has already earned a contract with the Department of the Air Force.
“In the research realm, [the campus] is bringing $90 million in research to its R&D lab starting in August,” she said.
Make it cool
Developer Danny Mientka, owner of The Equity Group, spoke about revitalizing South Nevada Avenue. He pointed to the success of University Village Colorado contributing to a vibrant North Nevada Avenue, adding that can be duplicated on the avenue’s opposite end.
“It’s blighted today and, left unattended, it’s redefining itself without a purpose,” he said of the city’s south end, adding “the Dollar Store industry, the [medical marijuana] industry, the check cashing industry, the pawn shop industry — they’re going to fill the void.”
With the help of the city, an urban renewal boundary was created around the area. Now, multiple developers are working within that boundary.
Two commercial areas have been conceptualized, Mientka said, one northwest of East Cheyenne Road and South Nevada Avenue, which will include about 100,000 square feet of restaurant and retail space.
The area between St. Elmo Avenue and Navajo Street could see an additional 105,000 square feet of development, to include a specialty grocery store anchoring a shopping center. All the development will focus on and utilize Cheyenne Creek, he said.
“Our hope and energy for this urban renewal area is to create something that is purposeful, walkable and connected,” he said. “Not just bricks and mortar — we want to create a feeling, not just a destination.”
Mientka said the city’s return on its tax increment funding investment in the neighborhood will include a reduction in a high number of emergency service calls for the area, a conservative 700 jobs created (although most will be service-related) and, after 25 years, sales taxes returned to developers as part of the TIF incentive, will transfer to the city.
Finally, Mientka said the area will be designed to attract the next generation of Southern Coloradans.
“It’s no secret the creative class is the future,” he said. “What can we do to make this community cool? For those who struggle to pay $1,700 [for rent] in Denver because it’s hip and happening, we can provide lower rent and give them a place … a comfort zone and something that gives them happiness. We have all these natural features here. Now we need the entertainment and restaurants and retail that appeals to Millennials.”
Mientka said demolition has already begun.
“We hope to see real estate closings in late [2016 and early 2017]. It takes about six to eight months to pull structures down and relocate folks. We expect vertical construction by late 2017 and stores opening in 2018 is the target.”