Denver’s largest hotels and malls fell in value after COVID

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The Hyatt Regency Denver at the Colorado Convention Center was the most expensive lodging property at $296 million in 2020. But after COVID, it devalued to $207 million in 2021. (Photo by Eric Heinz)

Before the COVID-19 pandemic, the Hyatt Regency in downtown Denver — one of the largest hotels in the city, with about 1,100 rooms — was valued at nearly $300 million by Denver County.

Now, however, he is considered worth $207 million, or 30% less.

Keith Erffmeyer

Keith Erffmeyer

Denver appraiser Keith Erffmeyer told BusinessDen last March that his office’s overall valuation of commercial real estate in the city will drop for the first time in a decade due to the pandemic, hotels and commercial properties registering the largest declines. New assessments were published two months later, in May.

Now, data obtained by BusinessDen shows the specific impact on some of the city’s marquee hotels and commercial properties.

In addition to the Hyatt Regency, several other downtown hotels are considered to be worth tens of millions less than before the pandemic. And the Westin attached to Denver International Airport saw its valuation plummet by $29 million.

On the retail side, the largest component of the Cherry Creek Mall, which is divided into multiple parcels, saw its valuation drop 16% in the last cycle, from $283 million to $237 million. .

Speaking to BusinessDen last week, Erffmeyer noted that the latest cycle assessed properties between July 1, 2018 and June 30, 2020 – meaning the numbers capture a moment still relatively early in the pandemic, when orders home were fresh in mind. and some businesses were just beginning to reopen.

“We had to approach it a little differently this time around,” Erffmeyer said. “The hospitality and travel industries were in an uncharted state. At that time, everything was pretty much closed, especially the city hotels.

Nick LeMasters, president and CEO of the Cherry Creek North Business Improvement District, said the lower valuations were expected. The BID provides assistance such as street maintenance and promotions to members who collect fees based on the value of properties.

NickLeMasters

Nick Lemasters

“We weren’t very surprised when we found out about the drop in valuations, certainly given COVID,” LeMasters said. “It became pretty obvious that this was going to affect properties at some point, hotels in particular.”

LeMasters, former general manager of the Cherry Creek Mall for more than two decades, said retailers may see a drop in their rent, but not by much.

“That could be a benefit for some retailers and some businesses, although I don’t think it will be that much,” LeMasters said. “(Landlords) spread the cost over to tenants, and that could reduce charges by pennies per square foot.”

Citywide, the merchandising sector was valued at $1.6 billion in the last valuation period, but dropped to $1.3 billion in the most recent. Lodging properties were valued at nearly $850 million in the previous valuation period, but fell to $775 million in the most recent.

LeMasters said leisure tourism and business travel were starting to return, but he said “group business,” such as conventions, needed to come back significantly. Once that happens, he said, hotels will be on “very solid ground.”

“I expect valuations to rise as business returns,” LeMasters said, adding that downtown hotels typically fill up first, then Cherry Creek sees overflow business. “But certainly the hospitality sector has been negatively affected, and we need to see our tourism industry come back.”

Here are the top 10 reviews for hotels/lodgings and commercial properties. Most, but not all, have seen their valuations drop. Some properties that might appear to be one unit, such as the Cherry Creek Mall and the Downtown Sheraton, are technically multiple parcels, so they appear below as such.

Top 10 Hotels/Accommodations

Hyatt Regency Denver at the Colorado Convention Center650 15th ave.

2020: $296,185,600

2021: $207,321,600

Sheraton Downtown Hotel1555 Court Square

2020: $133,256,700

2021: $94,448,800

  1. Hilton and Downtown Denver Marriott1701 California St.

2020: $121,048,700

2021: $92,417,900

  1. Sheraton Hotel1550 Court Place (same place, the street bisects it)

2020: $117,767,200

2021: $83,408,500

  1. Embassy Suites by Hilton1420 Stout St.

2020: $126,189,100

2021: $82,335,200

  1. Le Meridien Denver Downtown1453 California St.

2020: $113,276,100

2021: $77,693,600

  1. Four Seasons1144 15th street.

2020: $92,000,000

2021: $74,960,500

  1. WestinDenver1200 17th St. #3

2020: $100,506,000

2021: $71,657,700

  1. Denver Marriott Tech Center4900 S. Syracuse St.

2020: $89,231,000

2021: $68,968,400

  1. Hotel1600 Wewatta St.

2020: $77,828,200

2021: $68,470,300

Retail Top 10

Cherry Creek Shopping Center Broadband3000 E. 1st Ave.

2020: $283,134,700

2021: $237,151,100

  1. Denver Pavilions500 16th St. (South)

2020: $63,392,200

2021: $46,097,100

  1. West Cherry Creek Mall2500 E. 1st Ave.

2020: $46,097,100

2021: $46,097,100

  1. Tiffany Square7300 E. Hampden Ave.

2020: $43,222,100

2021: $45,490,100

  1. Denver Pavilions2, 500 16th St. (North)

2020: $49,178,600

2021: $35,618,000

  1. fire station block1890 Wazee Street 3

2020: $36,309,300

2021: $35,290,800

  1. University Hills Square, 2466 S. Colorado Blvd. (North)

2020: $29,352,600

2021: $31,988,700

  1. University Hills Square, 2780 S. Colorado Blvd. (South)

2020: $34,110,500

2021: $31,340,500

  1. Center Blvd.1685 S. Colorado Blvd.

2020: $25,610,600

2021: $26,079,900

  1. Clayton AlleyWhole Foods, 2375 E. 1st Ave. #RS

2020: $22,298,400

2021: $23,692,000

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