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Tag: Rental Market

  • 10 weeks free and an Ikon Pass: Denver landlords ramp up concessions

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    The easiest way to get free stuff in Denver right now is to lease a new apartment.

    “In the Denver market, we are certainly offering concessions, and I would expect most landlords are,” said Frank Campise, a Chicago developer who owns about 15 apartment buildings throughout the metro area.

    Apartment landlords facing the financial fallout from too much supply

    The region’s multifamily market has softened amid a historic increase in supply at the same time that demand has softened because of declining job growth. According to the Apartment Association of Metro Denver, the vacancy rate for Denver itself is 7%, with an average rent of $1,849 a month. That’s the lowest rent since the start of 2022.

    The picture is slightly rosier for the broader seven-county metro area, where the vacancy rate is 6.4%, according to the association.

    A certain period of free rent is the most common concession. Campise said that, to keep buildings full, lots of landlords are offering one to two months free.

    “In 2023, I think that’s when the market started to implode,” he said. “We would have not had any concessions in ’23. Not only would we have not had any concessions, but the top-line rent would have been 15% higher.”

    And two months isn’t the ceiling. Both The Alder, a new building in Parker, and The Russell, in Olde Town Arvada, are offering up to 10 weeks free on leases with 12-month terms or longer, according to their websites.

    Bill James and Eric Karnes, meanwhile, track Denver’s apartment pipeline for local research firm JRES Intelica CRE. Their data shows about 17,000 new units completed in the third quarter across the entire metro area. In comparison, only 5,000 units have started construction through the first three quarters of the year.

    “We get into a recession, and all these new projects keep coming. … Boy, that vacancy rate could shoot up over 10%,” Karnes said.

    The pair noted that landlords are also tacking on extra goodies. The Adler offers a $750 gift card if a tenant leases within 48 hours of touring the apartment. And at The Russell, move in by the end of November and you get a free Epic or Ikon ski pass.

    “And you can tell the lender – ‘It’s marketing!’” Karnes said.

    Sky-high concessions are most commonly found in new buildings still in lease-up. The owners often have a construction loan with a deadline and are in a race to get units filled before refinancing. They claim concession losses as a marketing expense, which allows their books to show they are paid full-price rent, even if the effective rent that a tenant is paying is less.

    Managers of older apartments can take a different approach to stay competitive.

    Denver-based Cornerstone Apartments manages 7,500 units, most in older buildings in central Denver, for a host of smaller landlords.

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    Matthew Geiger

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  • Former ICE field director seizes on immigration in race against Rep. Jason Crow to represent Aurora

    Former ICE field director seizes on immigration in race against Rep. Jason Crow to represent Aurora

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    John Fabbricatore enforced federal immigration laws in his position as an ICE field office director until two years ago, and now he hopes to help secure America’s borders as a congressman.

    The Republican candidate in Colorado’s 6th Congressional District is drawing on his career with U.S. Immigration and Customs Enforcement as he runs against U.S. Rep. Jason Crow in the Nov. 5 election. Crow, a Democrat, just finished his third term in Congress as the representative of the district, which includes Aurora, Littleton, Englewood, Greenwood Village and Centennial.

    The odds weigh heavily in Crow’s favor. The nonpartisan Cook Political Report doesn’t consider the fight for the 6th District to be competitive. It’s ranked as solidly Democratic, in part because Crow, 45, won all three of his elections by double-digit percentages and redistricting in 2020 resulted in boundaries more favorable to Democrats.

    That’s a change from 2018 when the district was seen as a battleground and Crow won his first race by unseating then-U.S. Rep. Mike Coffman, now Aurora’s mayor.

    But this time, Fabbricatore, 52, says voters are looking for a candidate who will prioritize the economy and lower taxes — and he contends that he’s the person for the job.

    “They want someone that wants to fight,” Fabbricatore said.

    He and Crow share certain traits. They’re both veterans: Fabbricatore served in the U.S. Air Force, and Crow was an Army Ranger. They’re hunters, each having longstanding experience with firearms. Neither hails from Colorado originally, with Fabbricatore raised in New York City and Crow in Madison, Wisconsin.

    And the candidates, both fathers of two children, reside in Aurora.

    Beyond that, their stances on major issues diverge — including on immigration, which Fabbricatore refers to as his “subject matter expertise.”

    He argues jobs are going to immigrants compensated with lower wages, taking positions that could be filled by Americans for higher pay. Fabbricatore says he supports “legal, vetted” immigration and more stringent enforcement of existing laws.

    “If we actually just enforce those laws, we will be doing much better than we are doing today with immigration,” he said.

    In recent weeks, Fabbricatore has raised the alarm alongside former President Donald Trump and other conservatives about the presence of Venezuelan gangs in Aurora — while Crow has called out exaggerations and criticized Trump for distorting the problems in certain apartment complexes.

    Crow notes that he represents “one of the most diverse districts in the nation,” with nearly 20% of his constituents born outside of the U.S. He wants to use federal grants and other programs to help immigrants and defend them against racist rhetoric.

    He said he backed a bipartisan immigration deal that ran aground earlier this year after failing to earn enough Republican support. It would have boosted the number of border patrol agents, immigration judges and officers that oversee asylum cases, as well as established more legal pathways for migrants and others without documentation.

    Fabbricatore said in a Denver Post candidate questionnaire that he would not have supported the bipartisan bill, instead preferring another bill with a greater focus on border security.

    Gun violence is what motivated Crow to run for office. He backs a ban on assault weapons and supports universal background checks. He’s also working to pass a bill that would apply the same restrictions to out-of-state residents when they purchase long guns and shotguns as they face when buying handguns — requiring that the gun be shipped to a federally licensed seller in their home state, with a background check performed there.

    Gun violence is “just an unacceptable, avoidable, ongoing national tragedy,” Crow said. “We don’t have to live with mass shootings.”

    Fabbricatore says he believes in gun rights and is instead pushing for investments in mental health.

    The candidates differ on abortion. Crow favors abortion rights, saying he aligns with the majority of Coloradans who back legal access to abortion — and he would support a federal law establishing that as a right. Fabbricatore says Congress should leave abortion’s legal status to the states. He opposes abortion, but he says he recognizes a need for exceptions, including in cases of rape.

    “Having been someone who worked in sex trafficking and saw what many women went through, I could never tell a woman that she couldn’t have a medical procedure to end what happened to her,” he said.

    Fabbricatore points to the economy as his No. 1 issue, saying it’s impacted by energy policy and immigration. He sees Colorado’s potential to participate in the energy sector through solar, wind, fracking and coal.

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    Megan Ulu-Lani Boyanton

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  • Billionaire Jeffrey Feinberg lists Brentwood mansion for rent

    Billionaire Jeffrey Feinberg lists Brentwood mansion for rent

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    Billionaire hedge fund manager Jeffrey Feinberg has tried for two years to sell his 20,000-square-foot Brentwood mansion. With no takers, he decided to list it for rent — at $250,000 a month.

    The head of Feinberg Investments has listed the four-story mansion for rent at 1047 North Bundy Drive, according to the Robb Report. The listing is held by Dan Malka of Engel & Völkers.  

    Feinberg bought the seven-bedroom, 11-bath spec home built by Ramtin Ray Nosrati in June 2021 for $44 million — or $1 million above its asking price.

    A year later, he tried to flip the property overlooking the Getty Center for $48 million, without success. He then relisted the property in late 2022 for $43 million, then dropped it to $38 million.

    The hilltop mansion tucked along a private cul-de-sac may be best known for its blue-and-gold basketball court, a tribute to the late Laker Kobe Bryant, plus a 10-car auto showroom, sports simulator and 1,000-gallon aquarium.

    The hedge-fund executive and longtime basketball fan had moved from Hidden Hills to the lofty home with sweeping views — but before the sale closed, he asked that its rooftop cannabis garden be replaced by cucumbers and carrots.

    The three-story, split-level home includes a soaring living room with a floating curved staircase accented by a custom chandelier, flanked by a living moss wall that goes down to a succulent garden.

    It includes a TV wall, sports-simulator room, three-hole putting green, basketball court and two swimming pools.

    The 1.3-acre compound also includes a 10-car auto showroom with floor-to-ceiling glass walls that open to a den, an office, hair salon, a bar with a nine-TV video wall and a 1,000-gallon dual-sided aquarium.

    There’s a two-story guesthouse and a movie theater with a starlight fiber-optic ceiling. And for $250,000 a month, a renter could access its “250 bottle wine cellar,” according to the listing, though it’s unclear whether the rental comes with bottles.

    Feinberg, a former managing director at the George Soros-founded hedge fund-turned-family office Soros Fund Management, once had his own investment firm. The $1 billion JLF Investment Fund shuttered some years ago, according to Robb.

    The early bitcoin trader now operates Feinberg Investments, a limited partnership that invests his personal wealth.

    In late 2019, he sold his $15 million Hidden Hills mansion to YouTube celebrity Jeffree Star. He also once owned a compound on Malibu’s Point Dume, which was sold for $21.8 million in early 2021 by his ex-wife, Stacey Feinberg.

    On Santa Monica’s Gold Coast, Feinberg also put an oceanfront house on the market last year for under $11 million, or $1 million less than he paid in 2019.

    — Dana Bartholomew

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    Hedge fund billionaire Jeffrey Feinberg looks to flip Brentwood spec mansion


    Hedge funder picks up massive Brentwood spec mansion from Ramtin Ray Nosrati


    Spec developer Ramtin Ray Nosrati plans “marijuana mansions”


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    TRD Staff

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  • Is the eviction of hundreds of renters from Barrington Plaza legal? A court case to decide is now underway.

    Is the eviction of hundreds of renters from Barrington Plaza legal? A court case to decide is now underway.

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    Nearly a year ago, every tenant at the massive Westside apartment complex Barrington Plaza was served with an eviction notice by their landlord, who said the residents of nearly 600 units needed to move out so the company could install fire sprinklers following two major blazes.

    In the months since, most of the tenants have left. But more than 100 stayed behind, vowing to fight in court for the right to stay in their rent-controlled units, suspecting that the owner’s real intent was to upgrade the complex and re-rent the units at market rate.

    On Wednesday, their day in court finally came as lawyers for the tenants and the owner, Douglas Emmett Inc., presented opening arguments in a civil case that will decide whether the evictions are legal. The tenants and their advocates see the case as an important test of renter protections in a city faced with an affordable housing crisis.

    “I wanted to make sure I’m represented in this fight for tenants in Los Angeles,” said Barrington tenant Chuck Martinez, who has lived in the building since 2021. “To lose this affordable housing is a step backward for L.A.”

    For the owner, the case at the Santa Monica Courthouse is about landlords having the legal right to choose not to continue renting their units. “Inside the courtroom, this is a case about upholding the law,” said John Samuel Gibson, attorney for Douglas Emmett.

    The company wants to evict the residents under the Ellis Act, which allows landlords to evict rent-stabilized tenants to remove units from the rental market — for instance, to build condos.

    The heart of the case revolves around whether the company truly intended to take the units off the rental market and whether the law requires them to do so permanently.

    Frances M. Campbell, the tenant’s attorney, said evidence presented during the trial would show that the company for years had plans to “transform and upgrade” the complex and to re-rent the apartments “at a new market rate.”

    Campbell said the law requires owners who invoke the Ellis Act to remove the units permanently from the rental market.

    “Defendants can point to no case that allows a landlord to invoke the Ellis Act to temporarily go out of the rental business while it remodels or makes repairs to its buildings. And that makes sense, because that is not the purpose of the Ellis Act,” the tenants’ lawyers wrote in a trial brief.

    The lawyer pointed to an email sent by Douglas Emmett CEO Jordan Kaplan to city housing official Mercedes Márquez in May 2023, just days before the eviction notices were filed, as evidence that the company intended to re-rent the units.

    “This project is likely to take many years and assuming we bring the rental units back online within 10 years (which is a very good assumption) they will still be subject to the RSO,” Kaplan wrote, referring to the city’s rent stabilization ordinance.

    In his arguments on behalf of Douglas Emmett, Gibson pointed to that same email as evidence that the company wasn’t trying to evade rent control.

    “I personally assure you we are not doing this to remove Barrington Plaza from the RSO,” the email said.

    Installing fire sprinklers and making other safety upgrades is a multiyear project, and the apartments will be removed from the market during that time, he said.

    The law allows owners to use the Ellis Act to “take the property off the rental market for a longterm period,” the company’s lawyers argued in a trial brief.

    The Ellis Act does not require owners to remove the properties from the rental market forever, he said. Only that they do not “conduct a sham removal” in order to evade rent control.

    “This is not one of those sham situations,” Gibson said.

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    Paloma Esquivel

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  • Apartment Rents Tick Up in LA So Far This Year

    Apartment Rents Tick Up in LA So Far This Year

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    Los Angeles apartment rents, which fell for four months at the end of last year, have rebounded.

    Average asking rents in Los Angeles rose 0.4 percent on a per-square-foot basis in February, following 0.2 percent growth in January, reversing the four-month decline, CoStar News reported.

    Nationally, rents rose for three consecutive months since late last year. In February, they were up 0.8 percent year-over-year, and 0.3 percent from January.

    The turnaround for rents in Los Angeles was attributed to rent give-aways. Spurred by modest renter demand, local property managers relied more heavily in recent months on concessions, according to CoStar.

    Some 27 percent of multifamily properties with more than 25 units offered concessions last month — the city’s highest percentage since the first half of 2021.

    The highest rent growth in Los Angeles occurred in neighborhoods with below-average rents, below-average vacancy and sluggish development, according to CoStar.

    Apartment rents in North Hills/Panorama City and South Los Angeles grew between 2 percent and 2.5 percent, with vacancies between 2.5 percent and 3.5 percent — well below average in  Los Angeles County. Both regions have had modest construction for decades. 

    At the same time, rents in Downtown Los Angeles fell 2.5 percent, with a vacancy of 10 percent, the highest in the county. Over the past 12 months, the area had more than 2,000 new apartments.

    CoStar expected Los Angeles to see rent growth accelerate this year, with apartment vacancy expected to fall this summer, and anticipated renter demand better matching “supply additions” compared to last year. 

    In Orange County, overall rents rose 2.2 percent last year, while falling 2.6 percent across L.A. County, according to Apartment List.

    A University of Southern California study in December predicted apartment rents across Southern California would rise up to 4 percent through 2025, with a slightly above-average rent increase in Orange County, where the typical asking rent would hit a record $2,800 a month. 

    — Dana Bartholomew

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    TRD Staff

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