May 23, 2017 - Colorado Real Estate Journal - by John Rebchook
Lakehouse breaks ground today.
Lakehouse is the 12-story, 206-unit condominium tower in Sloans, the mixed-use development on the former St. Anthony Hospital campus.
Lakehouse sits across from Sloan’s Lake, the largest body of water in Denver.
Units in Lakehouse, designed by RNL Design and Munoz + Albin, range in price from just under $500,000 to about $2 million. Units range in size from 675 square feet to 2,428 sf.
If you figured the average price of a unit at $800,000, it puts the completed value of the tower at $164.8 million.
Units are being listed by Dee Chirafisi, Kevin Garrett and Matt McNeil, of Kentwood City Properties.
Even before construction started and 25 months from completion, 13 percent of the units have been reserved, with four or five of the buyers combining units with views to die for.
“We have one part that provides views to the west and the north, so you capture the mountains and the lake,” Garrett said.
“They are truly spectacular views,” he said.
Early buyers primarily are from out-of-state, where they are accustomed to having tony towers along the water, such as Seattle, Chicago, Portland and New York.
Empty nesters downsizing from giant suburban homes also have been buying units.
“Empty nesters are willing to wait until it opens in 2 years, while the younger professionals will start to really get interested when it is about a year from opening,” Garrett said.
Lakehouse is being developed by Denver-based Nava Real Estate Development, whose principals are Trevor M. Hines and Brian J. Levitt.
The two came to real estate from totally different worlds to bring Nava, Hebrew for “beautiful,” to Denver.
Hines, 30, is the son of Gerald Hines, whose privately held Houston-based company that bears his surname is one of the world’s largest commercial real estate development firms, with about $100 billion in assets under management.
“I did follow my dad around, growing up,” said Hines, who was born in Houston, but moved to London when he was 9.
He returned to the United States for college. He received an engineering degree from Yale University and also studied at a yeshiva, a Jewish seminary.
“My dad has always been passionate about real estate,” Hines said.
“We would go on family vacations and he would always be taking photos of floors in shopping malls, or light fixtures in office buildings. He was always talking about the architecture of buildings.”
However, it wasn’t preordained that he would follow in his father’s footsteps.
“My father always said to me that the most important thing is the best job is one where you cannot wait to get out of bed and start each day,” he said.
Living in London changed his way of looking at real estate, but maybe not consciously.
Trading Texas for London
“It was a big change” trading Texas for Great Britain, he recalled, while sitting in the Lakehouse sales office between Stuart and Raleigh streets along West 17th Avenue.
“It was a very different culture and the food was very different, of course,” he said.
“But as a young person, you have more freedom than in Texas,” he said.
“In Texas, you can’t get around without a car. That means as kids, your parents have to drive you everywhere.”
London, by contrast, was what we call today “walkable.”
“You walk everywhere, or you could take the subway system,” he said.
Indeed, summing up his development ethos, he quoted a great British statesman and leader, Winston Churchill, who once said: “We shape our buildings; thereafter, they shape us.”
Denver easy choice for Hines
Hines, the father of five children, aged 5 months to 3 years old, came to Denver because his wife didn’t want to live in hot, humid Houston or the East Coast.
“It is easy to get to my family in Houston from Denver,” and his in-laws are park rangers, who spent their summers in the Rocky Mountain National Park.
“I like the slower pace of life here,” than living on the East Coast, Hines said.
“Denver is a big city, but it also has a small-town quality to it, which I really like.”
Before, during and after attending Yale, he attended yeshiva.
Asked how his religious training influences his development, he was so still for several minutes that he seemed to have stopped breathing.
“That is a deep question,” he finally said.
“I would say that I hope it gives me a greater sensitivity to others and how people live,” he said.
Also, buildings that he develops he expects to exist long after he is gone and he wants to leave something behind that future generations are proud of.
“The greatest legacy I’ve learned from my father is that I want my company to focus on quality,” Hines said.
“The buildings are bigger than us and our focus is not to do more deals or the biggest deals but to focus on whatever you do, to do the best job you can. Even little things are important.”
He isn’t kidding.
Quality king at Lakehouse
He and Levitt, for example, visited the factory where the glass for Lakehouse is being manufactured to understand every step of the process and the quality control.
They’ve repeated that process for much of the materials, visiting factories from Missouri to Canada.
“We won’t buy from China because we heard the quality is not as good,” said the 46-year-old Levitt, the father of two girls, age 8 and 6.
“We want to go the extra step,” which in the long run saves money, improves quality and makes for happy buyers, he said.
He said there are other developers that are as equally conscientious, although he has crossed paths with some developers in Denver who built crappy buildings and didn’t pay their subcontractors.
Levitt’s entry into real estate, was far less in the cards than his partner’s.
Levitt grew up in a family of doctors. His father is a cardiologist and his mother had a Ph.D. in psychology.
Like Hines, he used to follow his father, while he was making his rounds.
While the nurses treated him like a little prince, witnessing an operation assured him that medicine was not his calling.
“I didn’t like the sight of blood,” Levitt grimaced.
He went to the University of Colorado and received a degree in psychology.
After graduating from CU in 1993, he sought adventure by moving to New York City.
He tried his hand a lot of things including advertising and journalism.
He did a stint writing review of concerts.
“It got me into clubs, which was great because as a guy I would have had to stand in lines that were 6 miles long,” he remembered.
“Plus, I didn’t have any money.”
Levitt’s 1st real experience in NYC
Living in New York, he read the book by someone you might have heard about: “The Art of the Deal,” by Donald J. Trump.
“I thought real estate sounded interesting,” he said.
He liked real estate, but not in the Big Apple.
“I was the worst broker,” he said. “In New York, you have to convince the person that if they don’t do that deal right this moment, they will never live in Manhattan.”
He returned to Denver and enrolled in the University of Denver’s real estate program.
“I finished the two-year DU graduate program in one year,” he said.
After graduation, he went to work for a Don Berland in the Denver Tech Center.
“Don had a development/consulting firm that primarily served three families: the Vickers, Newell Grant the Van Schaacks.”
The three of them were big players in land. Grant founded Grant Ranch in southwest Denver and Jefferson County; the Vickers founded Castle Pines Village; and the Van Schaack family were major owners of the dirt that now is the Denver International Airport.
“I was directing six development projects and managed nine other assets from our Longmont office, called Black Fox Real Estate,” he said.
He then approached Forest City, the developer of Stapleton.
“I spent seven years working on great projects with a great company,” he said.
At Stapleton, he was involved with developing the East 29th Town Center, Saddle Rock and Northfield, the first LEED-certified mall in the U.S.
“It was a great learning experience,”he said.
In 2008, he formed his own company, Integral Real Estate Development.
His first deal was with Hampton Partners, headed by Jeff and Scott Robinson, who are best known for owning the Argonaut Liquor and Wine store on East Colfax Avenue in Capitol Hill.
They bought 17 vacated Alberstons.
“It was the worst deal ever,” Levitt said. “It was a tough deal, because the market tanked and we were holding 800,000 square feet of real estate,”
He did use the wealth of his knowledge on sustainability that he learned at Stapleton to advice the Robinson’s on how to transform Argonaut into one of the world’s greenest liquor stores.
In 2011, his company, facing more experienced competitors, landed the coveted Glendale River Walk proposal.
However, the massive redevelopment of Glendale never got off the ground.
The late Sherman Miller introduced Levitt to Hines.
Levitt had known Sherm, as he was known, for many years, as had a lot of buddies at Cushman & Wakefield, when Miller ran the Denver office.
Later, when Miller was the head of the CU Real Estate Center, he put together a panel that included John C. Cushman III and Gerald Hines.
“Trevor had just moved to Denver and I just kind of helped him connect the dots,” he said.
Big plans explored prior to Lakehouse
One early deal he proposed to them was to turn the former Cabela’s site in Wheat Ridge into a mall.
“I remember walking out there with Gerald and Trevor and our shoes getting all muddy,” Levitt said.
At first, Levitt that the mall along the property along Interstate 70 had promise, even though it is not that far from Colorado Mills.
But the more he dug into it, the more he realized the numbers didn’t pencil out.
“I just couldn’t make sense of it,” he said.
However, he and Trevor hit it off, finding that they shared the same passion for responsible and ethical developments.
Another early deal he considered was buying and razing 13 homes and replacing them with towers to complement the existing Park Lane towers at the north end of the park.
“If you stood and looked down the street, you would think that was what the city had in mind,” when they opened in the early 1970s.
However, it didn’t take him long to discover that given the current zoning and sentiments to growth that was a non-starter.
With so few condominiums being built in Denver because of the onerous construction defect regulations, he thought that it would be a good time to buck the trend and build for-sale units.
After talking to many lawyers and attending seminars they decided that condos could be built, despite the threat of potential lawsuits and higher insurance costs.
“The solution is to build a very good, high-quality building. That’s it,” he said.
It also helps that they are building a concrete building, instead of a frame structure, as a concrete structure is so solid.
They heard about Sloans and the redevelopment of St. Anthony’s and were intrigued.
They visited the site and were blown away.
“I just couldn’t believe you had this big, body of water and these great views,” Hines said. “And I looked at what was built around the area and I thought it was really being underserved.”
Levitt is a friend of Doug Elonowitz, who at the time was with EnviroFinance Group, which had bought the land and was cleaning it up to sell.
“Doug, can we buy your site? We want to buy your site.”
But Elonowitz told him it wasn’t yet on the market and they were too early.
“But we want to make a deal now,” he told him.
Levitt enlisted the help of broker Dorit Makovsky Fischer at NAI Shames Makovsky and inked a deal with EFG to buy the land.
Levitt knew they had a great site and a great architectural team, but he also wanted to introduce another element to the building – wellness.
Lakehouse a WELL building
The developers are pursuing certification as a Well building by the International Well Building Institute, the first multifamily building in Colorado to seek such a designation.
“The genesis of a WELL building is that I had actually seen a draft idea of the concept,” to create a healthy, holistic environment in a building before it was made public, he said.
He also hosted the first WELL conference in Colorado for ULI Colorado.
“Given my experience with Forest City and Stapleton with LEED, I really felt WELL was in its infancy,” Levitt said.
As they began talking to their engineers and architects, it became clear that introducing WELL features, ranging from a rooftop garden to cleaner water and air, was not only doable and at a nominal cost.
“Making Lakehouse a WELL building increased our costs by less than a half of a percent,” Levitt said.
Even the name Lakehouse was chosen to create a sense of well-being among the residence.
“When you think of a lakehouse, you think of going on a family vacation and maybe hanging out with your grandma and grandpa. It was just a warm and friendly time.We want to re-invite people to re-create that magical time at Lakehouse.”