LRA chooses Kelmore at Boulevard One in Lowry

This article, written by John Rebchook, was originally published on March 31, 2016 in Colorado Real Estate Journal.

Centennial-based Kelmore Development has developed about a million square feet of retail space since it was founded about 35 years ago.

Almost all of it was in the suburbs, primarily in the southeast corridor.

Now, it is tackling a high-profile urban development in Denver.

Kelmore has been chosen by the Lowry Redevelopment Authority to be the main retail developer at Boulevard One at Lowry.

Boulevard One is the final development piece of Lowry, since the former Air Force Base was shut down and replaced by one of the nation’s most successful redevelopments of a former military base.

The mixed-use center at Lowry Boulevard and Quebec Street that Kelmore will be developing is zoned for 185,000 square feet, although it likely will have less space than that when it is built.

Kelmore is part of a team with Embrey Partners, which will be developing a luxury 350-unit apartment community across from the mixed-use center by Kelmore.

The Embrey-Kelmore team beat out 13 other developers for the development assignment.

“Kelmore is the kind of boutique developer we were looking for,” said Monty Force, LRA Executive Director.

“They’re fully committed to our vision and willing to work collaboratively to build a place that gives this neighborhood a real vibe,” Force added.

In one respect, Boulevard One is a bit of a departure from what Kelmore has done in the past.

“I think you could probably say that this is our first urban project,” said Bob Koontz, principal and managing partner at Kelmore.

“However, I would say that our Greenwood Village development is more urban-like than suburban-like,” he added.

In fact, the differences between urban retail and mixed-use developments and suburban ones increasingly is being becoming blurred, he said.

A new suburban development, for example, no longer typically consists of big-box anchors surrounded by acres of parking.

“I think an urban tenant, such as at Boulevard One at Lowry, might be a little smaller,” than a suburban counterpart, he said.

But not much difference in size, as suburban retailers also want to make sure they have an efficient floorplan.

With rising land prices and construction costs, it makes sense not to build suburban developments bigger than needed, he said.

And suburban developments increasingly are becoming more walkable, he noted.

In any case, Lowry is a great place for Kelmore to expand beyond the southeast suburbs, he said.

“The thing about Lowry is that it is very walkable,” Koontz said.

“When you look at how well Lowry is connected to trails and how accessible it is really urban infill at its best,” he said.

And Boulevard One may be the best of the best.

“I really think that Boulevard One, with its wonderful streetscape, has the promise to be the best part of Lowry,” Koontz said.

The 8-acre parcel could accommodate uses such as a specialty grocery store, restaurants, entertainment and retail shops on the first floor with offices and living spaces above.

Buildings will be no higher than five stories. To provide visual interest and break up the scale, building heights along First Avenue will be limited to 45 feet (two to three stories). Parking ratios will be the same as the existing Lowry Town Center.

“Zoning allows for up to 185,000 square feet, but I don’t it will be that big,” Koontz said.

He said he wouldn’t be surprised if the ultimate size will be 160,000 sf or even smaller.

“Just because the zoning allows 185,000 square fee, doesn’t mean that is what we will end up having,” Koontz said.

It’s too early to say the size of the largest tenant, he said.

“The LRA just announced that we are the developer publicly, so until now we haven’t been able to do any premarketing or preleasing,” he said.

In choosing tenants, he said they will find restaurants and retailers that will complement the existing businesses at Lowry.

Lowry is a prized destination, which will make it a magnet for top retailers and restaurants, he said.

“I’m guessing we will end up with local and regional operations,” Koontz said. “I wouldn’t think we would have a lot of national tenants,” which could be found in a typical suburban location.

“I do think we will attract some first-to-market retailers,” Koontz said.

Also, he expects that there will be for-sale condo units built on top of ground-floor retail or offices.

“We would either do the condos ourselves or perhaps bring in a developer that specializes in condos,” he said.

In addition, because of its venture with Embrey, the apartment community that Embrey will develop likely will have less ground-floor retail than it might have otherwise, he said.

“Our retail will be very walkable for residences who will live there,” Koontz said.

Koontz has long wanted to work with Embrey, since he first visited its Quarry Village development in San Antonio, 10 or 11 years ago.

“Quarry Village is built to a very human scale and I think Boulevard One is also,” Koontz said.

‘“Ever since then, together with Embrey, we’ve been looking for the ideal place in Denver to build an energetic village center where people can shop, eat, live, work and socialize. We found that in Boulevard One,” he said.

The LEED Gold center will serve all of Lowry and east Denver neighborhoods.

“We’re going to build a high-quality, highly-connected, vibrant people place at the heart of the Boulevard One neighborhood,” said Koontz.

“The mixed-use blocks will be enhanced by imaginative parks and plazas and the center itself will be a place where people can do many of their daily rounds or enjoy a nice evening out,” he added.

Kelmore and its design team of MCG Architecture and Architecture Design Collaborative will undertake site planning and design review during the next six months.

Construction will be underway in 2017, with an opening tentatively scheduled for late 2017.