Clayton Lane: New owner good news for redevelopment

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  • Clayton Lane sold.
  • Invesco/OliverMcMillan pays $169.6 million for prime site.
  • Councilman New met with developer before the  sale.
Clayton Lane

A map of Clayton Lane in Cherry Creek. The new owner did not buy the Janus building or the J.W. Marriott hotel, but plans to redevelop the retail part of Clayton Lane.

City Councilman Wayne New met with the new owner of Clayton Lane before the developer even closed on the deal for the prime redevelopment site at the western gateway to Cherry Creek.

And New liked what he heard from San Diego-based OliverMcMillan, or OM.

“I think this is a positive step,” New said about OM.

“I think the developer has a really good track record and this will be very good for Cherry Creek,” New said.

Last week, Invesco Real Estate, in a partnership with OM, purchased the 5.4-acre Clayton Lane site anchored by Whole Foods at University Boulevard and First Avenue.

Records show the Clayton Lane site was purchased from Amcap Inc. for $169.6 million, or $506.53 per square foot.

One advantage to the new ownership, New said, is that “Amcap wasn’t a developer.” while OM is a developer with an extensive track record across the country.

Amcap primarily owns King Soopers-anchored shopping centers in the Denver area and considered Clayton Lane its crown jewel.

On its website, OM said it plans to redevelop Clayton Lane, which includes the empty Sears building, into a “true mixed-use community. The former Sears building, which now sits vacant, will be demolished to make way for a pedestrian-friendly street that runs throughout, connecting the various uses and retailers.”

Before the purchase, Eric Buchanan, the senior managing director OM, who will be in charge of the redevelopment of Clayton Lane, paid New a visit.

Claytone Lane

OliverMcMillan, which with Invesco recently paid $170 million for Clayton Lane, is developing this mixed-use site in Nashville.

New said Buchanan doesn’t yet know the ultimate square footage of the redevelopment or the number of buildings it will include.

Buchanan gave him no timetable for the start of the redevelopment. And OM has not submitted any development plans to the city, according to Andrea Burns, spokeswoman for Community Planning and Development.

Buchanan did tell New about OM’s developments across the country, including a mixed-use project underway in Nashville.

New said one obstacle to kicking off the redevelopment  may be the length of the Whole Foods lease. Whole Foods leases 53,126 square feet in its Clayton Lane building.

“I’m not sure how long the Whole Foods lease it, but I heard last year that it had five years left,” New said. “I heard that was an issue with Amcap.”

Last year, an Amcap executive told the Colorado Real Estate Journal that it wanted to incorporate a bigger and better Whole Foods into the Clayton Lane redevelopments it was planning and the grocer was open to the idea.

New said he had heard that Amcap may have been concerned about raising funds for the redevelopment and that may be why it sold the site, instead of redeveloping it.

Clayton Lane

An aerial photo of Clayton Lane. Clayton Lane in Cherry Creek recently was sold for just under $170 million. The new owner plans to redevelop it into a mixed-use, walkable site.

Amcap’s preliminary redevelopment plans for Clayton Lane called for new residential buildings, retail, and offices, but no hotel.

There probably is no need for another hotel, given that three are under construction in the area, New said.

OM’s purchase of Clayton Lane did not include the J.W. Marriott hotel or the Janus headquarters building.

New does think OM will keep the idea of creating a private street on the site to make it more pedestrian friendly, which was part of Amcap’s plan.

Clayton Lane

Denver City Councilman Wayne New.

“It seems like everyone wants that to happen,” New said.

Amcap had hired well-known and respected Denver architect David Tryba to design the Clayton Lane redevelopment.

“I’m not sure about the architect,” New said. “I hope they use David. It would be nice to have a local architect on it.”

New also said that he hopes that OM can incorporate for-sale condo units on the site. The zoning allows some 8-story buildings on the parcel.

“If we could ever get this condo construction defect mess worked out, maybe we will finally start seeing more condos being built,” New said.

New knows Cherry Creek.

He and his wife, Leslie, have lived in Cherry Creek North since 1999.

Before being elected last year, the first-time council member had served as the president of the Cherry Creek North Neighborhood Association and was a past chairman of the Cherry Creek Steering Committee.

Interested in buying a home in Cherry Creek? Please visit 8z Real Estate.

Have a story idea or real estate tip? Contact John Rebchook at JRCHOOK@gmail.com. DenverRealEstateWatch.com is sponsored by 8z Real Estate. To read more articles by John Rebchook, subscribe to the Colorado Real Estate Journal.

 

 

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John Rebchook

John Rebchook has more than 30 years of experience in writing and communications. As the Real Estate Editor for the Rocky Mountain News, he wrote about residential and commercial real estate for 26 years. He has won numerous awards for business stories and columns that he wrote, both as an individual and part of teams. In addition to real estate, he also covered economic development, banking and financing, the airlines, and cable TV for the Rocky. In addition, he was one of the original freelance writers for GlobeSt.com, covering commercial real estate for the Internet publication.

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