The Denver metro area has struggled with housing shortages for over a decade. Despite high demand, construction and development costs make it difficult to build enough housing, particularly in the city’s core.
Experts discussed housing and other issues Denver faces during a Sept. 20 Commercial Real Estate Symposium and Forecast Panels hosted by the Denver Commercial Association of Realtors.
“Denver is an exciting place. Many people want to be here,” said Marty Roth with CBRE.
While metro area governments work to streamline their process and create more supply, barriers include expensive land, high interest rates, and labor and material costs.
“We’re more than 100,000 houses short in the metro market,” said Mike Kboudi with Cushman & Wakefield. “To improve attainability and affordability, we need to create more supply, but it’s difficult to find places to build quickly.”
Limited land in Denver pushes development out into the suburbs, he said.
Ryan Severino, chief economist and head of U.S. research for BentallGreenOak, said cities like Denver must develop more public-private partnerships and improve incentives to build more housing in the core city.
“People want to live in cities, and we need to make it easier to live in cities so they don’t have to be shunted to the suburbs,” he said. “Economically, there’s no good reason for long commutes.”
Cities must do more to integrate work, housing, and commercial spaces.
“It’s better outside the U.S. where they don’t have the abundance of space we have,” Severino said. “They build vertically to use the space better. There are some good lessons to be learned from other countries and economies.”
Cities need to find ways to remove the impediment to building more housing.
“There are a lot of ills we’re dealing with that get fixed by solving the housing crisis,” he said.
But converting the oversupply of office space to housing isn’t an easy fix.
Pamela Koster with Berkadia said cities that have successfully transitioned office space to residential have a successful team effort with state, federal, and community money, tax abatements, and other incentives.
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“Right now, I don’t see the cost-effectiveness of converting office space,” she said.
Not only is it expensive to add plumbing and other features, but most downtown office buildings don’t have enough parking to meet the potential demand of residents.
“People use cars in Denver. Mass transit is still a secondary mode,” she said. “People want to strap on bikes or skis to go to the mountains.”
The news and editorial staffs of The Denver Post had no role in this post’s preparation.