An apartment project in the works since 2016 will officially open in Denver next week on land adjacent to another property owned by Pensam Capital.
The Miami-based company will cut the ribbon Aug. 19 on the five-floor, 176-unit Airie Denver. The building is next to The Capitol at TAVA Waters, formerly the Breakers Resort, which Pensam bought for $350 million in 2016.
The new project will open as the metro-area apartment market is experiencing declining vacancies and rising rents.
BusinessDen reported the sale of the 1,523-unit Breakers was the state’s most expensive single-asset apartment transaction until this year’s sale of the Palomino Park Apartments in Highlands Ranch for $435 million.
“When we bought the former Breakers, it was always our vision that the entire property would be developed out with the additional allowable units within that planned unit development,” said Michael Stein, a founding partner of Pensam Capital.
The company had the option to buy the land where Airie sits. The company declined to say what it paid for the 5.4-acre site.
Stein said Denver seems to be among the top cities for young professionals and people looking to retire to move. Airie, at 800 S. Valentia St., has apartments ranging from studios to three bedrooms and from 613 square feet to 1,520 square feet.
Rents go from about $1,600 to $3,600.
Pensam Capital was attracted to what became TAVA Waters for the area’s low density, open space and the private 60-acre Windsor Lake, Stein said. Airie residents will have access to the lake and walking trails as well as TAVA Waters’ fitness center, climbing wall, swimming pool, conference room, vehicle-charging stations and other amenities that Pensam spent $30 million to improve.
Stein said Denver is considered one of the best outdoor cities and people moving to the area are looking for city life with the convenience of outdoor activities. He sees a strong demand in the Denver-area market for more multi-family rental units.
“There’s plenty of demand,” Stein said. “Just the in-migration trends into Denver from a quality-of-life standpoint, I think, point to a very deep market for rental apartments for many years to come.”
Stein said a substantial number of apartments in Airie have already been rented, but declined to give an exact number.
A recent report showed the Denver-area apartment market is tightening. The area’s apartment vacancy rate fell to 3.7% in the second quarter this year, according to the “Denver Metro Apartment Vacancy and Rent” report from the University of Denver’s Daniels College of Business.
The vacancy rate is the tightest since 1999 during the dot-com boom. The median rent, or middle point, increased from $1,483.28 in the first quarter to $1,579.93 in the second of this year for a gain of $96.65 or 6.5% in just three months.
