A typical unit at Skyline at Highlands, Denver's newest luxury multifamily complex, can command far beyond the city's average monthly rate. Yet the developers behind the 533-unit property are launching the project with a different approach: giving some of the units away for free.
The joint venture between Denver-based development firm Grand Peaks and global investment company Access Industries is donating a year's worth of free rent for 10 of the property's apartments to Denver Public School teachers, a move that puts a spotlight on mounting affordability concerns as rates across the city climb to record highs.
“This is something that we were able to do without having to take any kind of grants, without having to take any kind of government assistance, without having to take any kind of fundraising,” Elli Lobach, senior vice president of development for Grand Peaks, said in a statement. “We were able to do it on our own, and quickly, and find a way to actually help real people.”
The move comes as housing affordability becomes a bigger concern across the United States, particularly in major cities. Government officials have been looking at ways to increase the supply of housing, and multifamily owners are also looking at the issue.
A typical unit at the $270 million project in the city's Jefferson Park neighborhood — one of the fastest-growing and priciest pockets throughout the greater Denver area — averages nearly $2,400 per month, according to CoStar data. By comparison, rents for the market as a whole average about $1,850 a month.
The donated units were doled out through a drawing organized by the Denver Public Schools Foundation. More than 215 teachers who earn an average salary of less than $72,500 a year applied, DPS Foundation President and CEO Sara Hazel said in a statement, pointing to the outsize demand for more affordable housing options in the city.
"Denver is a better city when our teachers can live and work in the communities that they serve, and we know that Denver is, for many people, unaffordable,” she said. The drawing for the donated units "highlights this really important need in the community for our teachers.”
Housing Strategies
The donation is the latest example of a local stakeholder, beyond a government body, taking matters of the city's affordability concerns into their own hands.
Major Denver employer DaVita, one of the nation's largest kidney dialysis care providers, unveiled plans last week to partner with two local development firms to transform the surface parking lot at 2000 Welton St. in Denver's Five Points neighborhood into a to-be-determined number of housing units intended to provide “much-needed workforce housing," according to a statement from the company.
Similar to other markets that boomed in the early years of the pandemic, Denver multifamily rents jumped from about $1,500 a month in 2020 to the current average of nearly $1,900 per month, according to CoStar data. While the area has one of the most active apartment construction pipelines in the country, most of the units underway are concentrated at the higher end of the development spectrum, a scenario some housing advocates have said is only driving rents higher.
Denver officials have attempted to address the city's worsening affordability landscape with a mix of strategies aimed at boosting housing development, specifically for lower-income renters. In 2022 the city passed its Affordable Housing Policy, which requires new developments that include 10 or more units to set aside as much as 15% of the project for low-income renters.
The Grand Peaks-led venture broke ground on the Skyline project at 2501 W. 26th Ave. in late 2021, meaning it was exempt from the affordability requirements. Construction work officially wrapped up in June with the project debuting a range of amenities such as a pool deck, rooftop lounge and a concierge service that gives residents discounted access to nearby retailers.
The project, which also includes a neighboring 91-room hotel, is the latest completion for a regional pipeline that still has upward of 20,300 multifamily units underway, according to CoStar data. A majority of that pipeline consists of luxury and higher-priced units.