City Of Denver Moves Closer To $88.5M Purchase Of Denver Post Building Downtown

The Denver City Council on Tuesday gave its first approval for the city to purchase the former Denver Post building at 101 W. Colfax for roughly $88.5M.

But some council members expressed concerns over the deal’s financing and the due diligence performed by the city. 

Similar concerns have been expressed about other real estate deals Denver has made. In October 2023, city council members raised concerns about overspending on pallet shelters for Mayor Mike Johnston’s micro-communities. 

The ordinance to purchase the 307K SF Denver Post building passed by a 9-4 margin. A second vote to approve the deal’s financing is expected to take place within the next month. 

“Something I do not appreciate about the process of purchasing real estate with the city is that this is our only chance to vote,” District 7 Council Member Flor Alvidrez, who cast one of the nay votes, said during the meeting. “If an inspection goes through and shows there are some really bad problems with the building, we don’t get a second chance at this.”

The city has leased space in the Denver Post building since 2016 and occupies more than 50% of it. However, Alvidrez said city officials haven't answered her questions about how much Denver spends on the lease and how much it will cost to break the lease for the sale to be finalized. 

The property is owned by a company called Kayan LLC, which purchased the building in 2006 for $93.4M, city records show. 

Denver Director of Real Estate Lisa Lumley told the city council that the deal would be “general fund-neutral,” meaning that it wouldn’t have an impact on the city’s financial well-being.

Lumley said Denver expects to earn roughly $7M per year from rent charges at the building between 2024 and 2029, but it remains unclear how Denver will recoup the full $88.5M. Members of Denver’s finance department are expected in February to brief the city council on the potential return on investment for the purchase. 

Lumley told the city council in December that the city wants to purchase the building because of its proximity to courthouses, and Denver anticipates a significant increase in its caseload by 2040. 

District 8 Council Member Shontel Lewis, who voted against the ordinance, also expressed concerns about the purchase.

“I am unable to reach the conclusion that [Denver] taxpayers are getting a good deal for this money,” she said. “A couple of gaping holes in this proposal has me wondering who is meant to benefit from this project.”