What a Hole in the Ground May Indicate About the Health of the Real Estate Market

I have lived in the Cherry Creek North neighborhood long enough to watch our neighbors to the south i.e. Cherry Creek East blossom into a diverse neighborhood from rental and condo high-rises to townhomes, mid-height rentals, an assisted living facility and oh so many townhomes built usually as rows versus the duplexes you see north of 1t Avenue (as most of Cherry Creek East is zoned Planned Unit Development).

On my walk this afternoon I was stopped in my tracks at The Cassidy (basically S. Harrison Street between Cedar and Bayaud Avenues). I had watched over the past weeks as the earthmovers excavated for the foundation with the assumption of full ceiling height basements. The units directly to the south seem to have sold and thus now a larger lot with plans for 37 units and a well-known broker who represents many new developments in the area as listing broker and sales point person.

What stopped me in my tracks was not the glossy marketing sign; it was what someone attached to it. Someone had cut out and highlighted the foreclosure notice on the property dated 9/28/17 from The Denver Post. Yes, the foreclosure notice.

The Cassidy Foreclosure Notice
Someone posted the foreclosure notice as published in The Denver Post (9/28/17) on the marketing sign.

While foreclosures were front and center during the Great Recession of a few years back, lately all we see are cranes on the horizon and continue talk about growth and the desire for Amazon to locate HQ2 to Denver.

Yet maybe it is irrational exuberance rearing its ugly head or our desire not to confront reality. I have been forecasting a downturn documented in this blog for months. Even the Wall Street Journal mentions rent-concessions and other activities, which may suggest not only is the boom loosing steam but also we may be moving into an overbuilt scenario.

Yes record prices were recently paid for the Steele Creek Apartments in Cherry Creek (of note the original developer Eric H. Bush who assembled the land on which Steele Creek was developed recently committed suicide). While I am not suggesting any nexus, I would just be concerned when we have record sale prices and 7 blocks east a foreclosure on massive lot on which 37 for-sale units were proposed.

Just food for thought.

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