4/03/2005

Aurora abandons E. Colfax project: Rocky Mountain News (Denver CO), 3/31/05

Short on cash, city hopes developers will step in to fix up land near Fitzsimons

By Javier Erik Olvera

Aurora [CO] is scrapping its plans for the $50 million redevelopment of acreage across from the old Fitzsimons Army Medical Center because the land is too expensive.

For the past three years, the city has planned to transform 17 acres of aging businesses and housing at East Colfax Avenue and Peoria Street into an upscale development anchored by a grocery store.

But the plans ground to a halt Wednesday when city officials realized there was no way around an estimated $12 million shortfall in the funding needed to get the project off the ground.

"It's frustrating," said Mayor Ed Tauer, adding that he is confident the development would have flourished with its proximity to Fitzsimons, which will have 20,000 employees when its evolution into a state- of-the-art medical campus is completed in about a decade.

Some of the 34 property owners who faced losing their homes or businesses if the project had gone forward are breathing a bit easier now, with one saying "it's nice to finally have this monkey off my back."

But Aurora officials say they aren't giving up on plans to redevelop the area but will now rely on developers rather than the city to make it a reality.

"The decision really doesn't change our commitment to the area," said Councilwoman Ingrid Lindemann, adding that she expects developers will be approaching property owners in large numbers as the remaking of Fitzsimons approaches completion.

During the past six months, the city has searched for a way to purchase the acreage, relocate businesses and raze buildings, but came to the conclusion it could come up with only a portion of the $26.8 million needed for the first phase of the project.

"It comes down to the bottom line," said Lindemann of the decision to ditch the plan. "Unfortunately, we could not bite off that big of a chunk at this time."

The project would have been a cornerstone of efforts to refurbish 110 acres around Fitzsimons that the city designated as blighted and wanted to redevelop with coffeehouses, grocery stores and restaurants.

The Peoria Street and East Colfax Avenue intersection became a redevelopment priority, with the city working with a developer to either buy or condemn the property of unwilling sellers.

Several property owners resisted, saying they didn't want to leave the area.

Plans for a 150,000-square-feet project anchored by a grocery store and a restaurant began to unravel last year when the city learned that the developer, Daniel Yacovetta, of Denver Holdings Inc., was in the middle of bankruptcy proceedings.

Some property owners claimed that Yacovetta had threatened to seize their land and made offers that were well below fair market values.

The city divorced itself from Yacovetta and began negotiating with Florida-based Regency Centers, one of the nation's leading developers of grocery store-anchored projects.

After the land was appraised, they began working on several funding options, but were unable to find a suitable one, said Dianne Truwe, the city's director of development services.

"(The city and the developer) thought the project would work . . . but we came to the conclusion that there was a gap that neither one of us could figure out how to cover," she said.

John Dare is one of the property owners happy with the outcome, saying it's the end to a long fight that he didn't want to lose.

"It's nice to finally have this monkey off my back," said Dare, who has owned Fenimore Auto Service for 32 years. "We've been fighting this a long time."


Rocky Mountain News: www.rockymountainnews.com