Commercial Real Estate

Resolute’s proposed self-storage facility is shown in the graphic above. Source: Resolute Investments.

In May, the Colorado Court of Appeals upheld the City of Thornton’s approval of a specific use permit for a self-storage facility against a challenge brought by a competitor self-storage facility.  While the court’s decision in Stor-N-Lock Partners #15, L.L.C. v. City of Thornton was a victory for the defendants, including the city and the developer, the court ruled that defendants in Rule 106(a)(4) actions may not recover delay-induced damages through the imposition of a bond.  Otten Johnson attorneys Brian Connolly and Bill Kyriagis represented the defendant landowner and developer, CenturyLink and Resolute Investments, Inc., respectively, throughout the proceedings.

In the case, Resolute obtained the city’s approval of a specific use permit for its project.  A neighboring self-storage facility challenged the approval under Colorado Rules of Civil Procedure Rule 106(a)(4), which allows for judicial review of quasi-judicial decisions by local government bodies.  The plaintiff alleged that the approval of the specific use permit did not improve the welfare of its property, which was one of the Thornton code’s criteria for the issuance of a specific use permit.  The district court affirmed the city’s decision but denied the defendant’s motion to require the plaintiff to post security in an amount that would cover the defendant’s losses incurred as a result of litigation-related delays. 
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We’ll start in Boulder and with commercial development. In February, the Boulder City Council directed city staff to draft an ordinance that would raise the city’s affordable housing linkage fee on new commercial development from $12 per square foot to $25, $30, or $35 per square foot.  Boulder’s current $12 linkage fee is the highest such fee of any city in the country between the two coasts, with Palo Alto the highest in the country at $35.  Even so, City Council members expressed that the current fee is still low enough vis-a-vis fees on residential development to incentivize commercial development over residential development. And more commercial development without new housing only exacerbates the city’s acute jobs-housing disequilibrium. 
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Last week the U.S. House of Representatives passed a bill that seeks to delineate what causes a commercial real estate loan to be classified as a “high volatility commercial real estate loan,” or, as it’s more commonly referred to, as a “HVCRE loan.”  Since the rule regarding HVCRE loans was promulgated, there’s been much debate and confusion around that fundamental question.  A synopsis of HVCRE loans and the implications of HVCRE classification can be found here.
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Last week, Denver voters received their ballots for the November 7 municipal election.  In addition to considering a $937 million bond issuance and a Denver Public Schools Board election that has garnered national attention, Denver voters will decide whether to mandate the construction of “green roofs” on large buildings throughout the city.  The proposed ordinance would apply to all new construction and every “roof replacement” on buildings of 25,000 square feet or more beginning in January 2018.
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California Investor Buys former StorageTek/ConocoPhillips Campus in Bid for Amazon

In a bid to have Amazon select Boulder County as its much-ballyhooed second headquarters, California’s Bancroft Capital recently went under contract to purchase the 432-acre property (depicted below) in Louisville that is the former home of StorageTek.  The property is currently owned by ConocoPhillips. Bancroft also developed the Peloton project in Boulder.
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