Plans to add 106 affordable apartments above the former home of the El Diablo restaurant could attract up to $7 million in public assistance.
Zocalo Community Development is asking the Denver Urban Renewal Authority to kick in $4.5 million for the project and for the city to Denver to help out with a $2.5 million affordable housing loan, the firm's principal and CEO David Zucker said Saturday. Construction on the 92-year-old building at 101 Broadway is expected to start before the end of the year and wrap up in 2018.
"It's very expensive to redevelop a project like this," Zucker said. "The way that we make it work is through critical assistance from the city of Denver."
Zucker declined to publically provide the overall cost of redeveloping the four-story First Avenue Hotel building, but BusinessDen previously reported the project would cost upward of $30 million.
The Denver Urban Renewal Authority — aka DURA —and the city of Denver are both considering Zocalo's application for assistance and declined to talk about how much the project could receive and when.
"While we are in receipt of an application for potential tax increment assistance for the project, we have not completed our preliminary underwriting to determine what, if any, role DURA may have in the project," said Tracy Higgins, DURA executive director.
"Until this evaluation has been completed and reviewed and approved by the DURA board we are not able to comment any further on amount or timing," Higgins said via email.
El Diablo and Sketch Food & Wine were forced to close in 2013 due to structural deficiencies with the Denver landmark. The building also needed roof repairs and had other safety hazards. The building -- on a prime intersection on bustling South Broadway -- has been vacant since then.
"The structural issues the building faced are modest when considering a really big renovation," Zucker said.
Zocalo Community Development is proposing adding retail and restaurant space back to the ground floor of the building as well as 106 affordable apartment units to the upper floors.
The studio and one-bedroom apartments would be 420 square feet on average and go for around $900 per month. Those who make 60 percent of the area median income — $35,280 or less — would qualify for the units, according to Zocalo.
The Denver-based developer wants to knock down the two-story addition west of the First Avenue Hotel building for the project and replace it with a five-story structure. The proposal is set to go before the Landmark Preservation Commission for approval June 6. The commission approved the demolition of the addition last month.
"By delivering attainable housing upstairs and reanimating and re-tenanting the commercial space we feel this is a project that really helps South Broadway continue to grow and feel the same as it grows," Zucker said.
Subscribe to Denverite’s newsletter here.
Business & data reporter Adrian D. Garcia can be reached via email at [email protected] or@adriandgarcia on Twitter.
