By Regan Foster
Where biblical scholars once studied, new families could soon put down roots.
The Colorado Springs City Council gave its final blessing Jan. 28 to a housing plan that will turn the former Nazarene Bible College campus into a 427-unit community. Dubbed Chapel Heights, the Challenger Homes project is slated to include 190 single-family detached houses, 132 single-family attached (duplex) units and 105 lots for three- and four-unit properties. It’s expected to include a mix of owner-occupied properties and rental cottages, a public community center and open space.
Two icons of the sprawling 42-acre campus at 1111 Academy Park Loop — its soaring bell tower and the circular chapel — will be preserved, while the remaining five buildings are scheduled for demolition starting in February.
In late January, council voted 6-1, with one recusal and one absence, in favor of the plan, but getting there was no small task. On Jan. 14, the board subjected Challenger Homes representatives to a 2½-hour grilling focused largely on the fact that the campus comprises some of Southeast Colorado Springs’ only developable acres located inside federally designated opportunity zones.
Based on census tracts, these zones allow investors to essentially crowdsource approved redevelopment projects by investing capital gains for up to 10 years. The concept aims to attract developers into economically slowing areas by offering fiscal support from outside sources, while simultaneously giving investors a deferment on otherwise-hefty tax burdens.
There are three identified zones either completely or partially located south of Platte Avenue and east of Interstate 25. Chapel Heights is included in one 423-acre zone — however, of that 400-plus acres, only about 68.34 acres were vacant or parcels that could be redeveloped, according to city records.
And therein lay the sticking point. Just because a project falls in an opportunity zone doesn’t mean it has to follow the federal model.
Fourth District Councilor Yolanda Avila and Council President Richard Skorman recused themselves from the public hearing and vote, citing a counsel suggestion that their participation in prior community meetings and conversations with the developer may cause the appearance of a conflict of interest. Avila was absent from the Jan. 28 final vote.
“My heart is for staying here and advocating for my district, but my mind says I have to let go of any perception that I would make a vote unethically,” Avila said before exiting council chambers Jan. 14. “I just do want to say that I am concerned with the density issue … and the loss of a substantial part of an opportunity zone.”
Challenger Homes’ Jim Byers, vice president for community development, and Jim Houk, president of consulting land-use planner Thomas + Thomas, made the case for the proposal during the protracted public hearing.
“This has been a struggling corridor,” Houk told council. “We think with some new products, some new housing, we’ll give a lot of new options … that will bring in more people and help to generate more business in there. There are definitely some … [opportunities] that this … shot of energy and some new folks will bring to the corridor.”
But, like Avila, some councilors took issue with the fact that Challenger didn’t intend to take advantage of the opportunity zone, which was established in the spring of 2018.
Byers told the council that his company was in negotiations with Nazarene Bible College to buy the land before the zone boundaries were finalized. It wasn’t until 2019, he said, that his company even became aware that the property fell inside the borders.
“When we, as Challenger Homes, went under contract on this property … we started developing our vision for how this thing can work,” he said. “We spent a huge amount of time and energy in the due-diligence phase. This is a lot of work, obviously.
“We … understood that this … investment mechanism has a 10-year window or so on it and it is intended for people who are going to hold property for 10 years. We are homebuilders: We build homes, we sell them. We do not hold onto them for 10 years.”
But Councilor Bill Murray, who cast the lone dissenting vote on both Jan. 14 and Jan. 28, pushed back.
“You can build these anywhere else in the city,” he challenged Byers earlier in the month. “Why here? Why is this such a valuable thing for you guys?”
“It ties back to the availability of land,” Byers answered. “This is a unique piece of land. Forty acres of land is next-to-impossible to find.”
“That’s why it’s an economic opportunity zone,” Murray fired back.
Nazarene broke ground on the campus in 1967. Over the decades, it moved from being a physical institution to a virtual one. Since making the move to digital-only in the mid-teens, College President Harold Graves said, three would-be land buyers entered into contract, but none made as much sense as the residential development.
The Challenger plan includes retrofitting the existing chapel into a multi-use community center that will be open to not just residents but to the surrounding neighborhood, and keeping as a centerpiece the Gothic-influenced tower that is visible from Fountain Boulevard.
Graves publicly thanked the developers for “keeping some very visible markers for some of our alumni who want to come back and visit parts of the campus.
“We love this community,” he continued. “I lived here for 11 years. … Since I was there five days a week every week, I see the need for development in the community.”
Purchase prices for the homes are expected to start in the low $200,000s and go up to just shy of $300,000, Byers told council. He added that rentals will be built, leased and managed by local developer Goodwin Knight.
“It is a little bit of a lost opportunity,” Councilor Andy Pico said. “But the economic opportunity zone doesn’t mandate that you use it.
“Nobody [else is] knocking on the door. If I say no, are they going to throw back the fish because they think there’s a bigger fish in the pond?”