|Sage Hospitality to Relocate to Historic Steel Building
Investment from Denver Office of Economic Development and CHFA Spurs Lease Announcement
Denver’s Office of Economic Development and Evan Makovsky with Shames-Makovsky Realty Company announced today that Sage Hospitality Resources LLC will occupy the upper three floors of the historic Steel Building, on the corner of 16th and Welton Streets, as an anchor tenant. The announcement was made during a press event Wednesday, celebrating two economic development financing transactions for the building that were recently finalized.
“Our strategic investment of New Market Tax Credits and a façade improvement loan is quickly paying off,” said Denver Mayor John Hickenlooper. “The City’s economic development tools have spurred restoration of this incredible building, which, in turn, further activates our downtown, poising Denver for additional jobs.”
Restoration of the building’s exterior, which is partially funded through the Denver Office of Economic Development, is scheduled to be completed this August. Makovsky, who has renamed the property the Sage Building, anticipates the tenant-finish construction for Sage Hospitality to be complete by March 2009.
“Being a third-generation Coloradoan, I feel blessed to have the opportunity to restore this grand old building for the present and future generations,” said Makovsky. “I want to thank Walter Isenberg and Sage Hospitality Resources for showing their commitment to downtown Denver and to this building by establishing their headquarters at 16th and Welton.”
Sage Hospitality will occupy the upper three floors of the four-story building. The move will boost the company’s office space by 40 percent as compared to its present location at 1512 Larimer St. The 10,000 square-foot increase will provide Sage with a more efficient operation today as well as allow for future growth, said Sage President/CEO Walter Isenberg.
“We are excited to renew our 25-year commitment to downtown Denver by signing this lease, which allows us to support our future growth in a building that reflects Sage’s commitment to historic adaptive reuse,” said Isenberg.
Financing for the $16.5 million Sage Building restoration includes approximately $7 million in New Market Tax Credit financing. A $1.25 million Community Development Block Grant façade loan, administered through the Denver Office of Economic Development, is financing a portion of the building’s façade improvements.
Reflecting public and private sector partnership and innovation, New Market Tax Credits are an economic development finance tool created in 2000 by the federal government. New Market Tax Credits are designed to bring private sector investment into low-income, or underserved communities for the purposes of creating jobs, community revitalization, and overall public benefit. The tax credits are awarded annually by the federal government to a community development organization or fund, who in turn will make loans and capital investments in businesses located in underserved areas.
The property’s New Market Tax Credit investment comes from a $40 million New Market Tax Credit award to the Colorado Growth and Revitalization (CGR) Fund, made up of the Colorado Housing and Finance Authority, which serves as the Fund’s managing partner, City of Denver, and Colorado Enterprise Fund. In addition to New Market Tax Credits, financing for the Sage Building was provided by developer Shames Makovsky Realty Company, FirstBank of Colorado, Denver Office of Economic Development and others.
CHFA Executive Director and CGR Fund Officer Milroy Alexander said, “The renovated Fontius building will be a catalyst for the continued revitalization of the 16th Street Mall area, bringing new jobs, tax revenue, and economic benefit to the entire Denver community. This is exactly the type of project that the Colorado Growth and Revitalization Fund was designed to finance.”
Makovsky also praised Mayor Hickenlooper, the Denver Office of Economic Development, Colorado Housing Finance Authority, FirstBank and the Downtown Denver Partnership for their confidence in and support for the project. The developer also thanked the teams at klipp architects and Milender White Construction Co., and to the Gary Cook family, previous owners of the building, for allowing the structure’s redevelopment.
The Denver Office of Economic Development (OED) works to create a local environment that stimulates balanced economic growth through job creation, business assistance, housing options and neighborhood redevelopment.