Paul Malone is on a mission for the missing middle.
“We’re doing everything we can right now to find creative ways toward attainable housing around town,” said Malone, president of Denver-based Highland Development.
And that starts with The Nightingale — a little project with big upside.
Scheduled to deliver this fall, Highland Development is bringing a first to Denver — a condo project that will be built using modular construction. Instead of building out the 39-unit development at its site in Uptown at 21st and Downing streets, each unit will be constructed individually in Minnesota by a company called Northstar, and then shipped to Denver where it will be pieced together over an above-grade parking foundation.
Modular construction comes with plenty of advantages. Quality increases because the work is done in a controlled environment. Projects can also deliver quicker due to the work being more predictable.
But the biggest advantage is cost. Construction material costs are within 5% of a traditional build, but it’s estimated that the construction schedule time can be reduced between 40% and 50%. And that’s a big reason why Malone and his team are able to offer prices at The Nightingale that are significantly cheaper than other new condo builds going up across the city.
Studio units are between $250,000 and $255,000; one-beds are $299,000 to $352,000; and two-bedroom units range from $437,000 to $520,000, depending on size and views. At today’s interest rates, first-time buyers who can scrape together 5% for a studio purchase could be looking at a monthly mortgage payment of around $1,300 per month for a brand new, never-been-lived-in-before condo.
Another driving factor of the relatively low cost is the size of the units. Studios are 358 square feet; one-bedrooms are between 500-700 square feet; and two-beds are around 900 square feet. The average unit size is 550 square feet.
Malone is a firm believer that smaller-sized units and a more minimalistic lifestyle is a trend urban dwellers want in Denver. It costs an additional $15,000 for a deeded parking spot at The Nightingale, but that’s because he believes a lot of city residents are ditching their cars for a combination of public transit and ride-sharing options, like Uber and the influx of scooters in the city.
“Our buyer pool wants a nice lock-and-leave option because on the weekends, they’re heading to the mountains,” he said. “They don’t have time for maintenance because they’re out with friends four or five days a week. We’ve really thought about the demographic of the buyer.”
Design is also important. The studios, for instance, come with a built-in Murphy bed and the kitchen is designed for optimal storage.
And the final cost-cutting measure is amenities. Apartment and condo high-rise developers have packed their projects with top-of-the-line amenities — something that buyers in the luxury category desire. But by only going with high-quality, smaller units wrapped around a community courtyard with a neighborhood feel, and ditching things like gyms, pools and yoga rooms, the Nightingale’s homeowners association fee remains low at roughly 35-cents per square foot. For a studio, that means $125 per month.
Modular construction has taken off in Europe and specifically in the Pacific Northwest in the United States. In Denver, there’s a few apartment projects that have implemented the practice, but until The Nightingale delivers this fall, there have been no modular-built condos in the Mile High City.
But developers are taking notice. Malone said his project has drawn heavy interest from the development community and he plans to host an industry night as the building is put together. Denver High-Rise Living also plans on hosting an event for buyers who are interested in the development. A date has yet to be determined.
Denver remains about 18,000 condo units behind current demand. The use of modular construction can speed up time to market, filling that demand quicker.
Highland Development’s next project is an apartment development in the West Colfax neighborhood, which will also implement modular construction, allowing them to charge cheaper rents.
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