By Rebecca Macey, development director, MGL Partners
For those of us who’ve called Denver home for decades, it’s hard to believe how much the Northeast corridor has changed. Once little more than open fields punctuated by the white peaks of the Denver International Airport (DIA) rooftop, this area has become a hub of commercial and residential activity. With major projects like Colorado Aerotropolis and DIA’s Vision 100 and Operation 2045 on the horizon, the question isn’t if people will come — they already are, with one million more expected by 2045 — but how we can create housing across the full spectrum to support a diverse, dynamic community here for generations to come.
For MGL Partners, which recently completed several multifamily projects in the DIA submarket, the projected growth in this area presents both an opportunity and an immediate need to develop complete communities with a thoughtful mix of market-rate, workforce, and affordable housing. This vision is easier said than done. Between still-high interest rates, persistently elevated costs for construction materials and labor, and now rapidly rising insurance premiums, getting projects off the ground is no small feat. These hurdles make it increasingly challenging to balance quality, affordability, and inclusivity, even as the demand for housing continues to grow.
Market Dynamics in Northeast Denver
The combination of proximity to the world’s sixth-busiest airport, job opportunities, affordability relative to other Denver neighborhoods, and lifestyle appeal is driving housing demand. Transit-oriented communities in particular (TOCs) (like Peña Station NEXT) are increasingly attractive. This 392-acre “smart city” is close to DIA and well-connected by RTD’s A Line, offering residents a walkable, transit-rich community that’s designed with sustainability and connectivity in mind.
Within this framework, MGL Partners has delivered two complementary projects: Hangar 61 @ Peña Station, a luxury multifamily community, and Elevate @ Peña Station, a workforce housing project offering 54 of its 198 units for residents earning 80% or less of the Area Median Income (AMI). These developments provide options for a range of residents and demonstrate the potential of mixed-income communities to foster a more resilient neighborhood.
Hangar 61 @ Peña Station, completed earlier this year, is tailored for professionals working at DIA and beyond. Its mix of high-quality amenities, such as a pool and spa, fitness center, club lounge, co-working rooms, and spacious apartments with mountain views, caters to middle-income residents while supporting the area’s stability. Elevate @ Peña Station, completed in 2019, offers similar amenities and community spaces that foster connection among residents. Located a short walk from Peña Station, both projects align with DIA’s sustainability goals and vision for a mixed-income, walkable neighborhood.
Funding Mechanisms for Mixed-Income Housing
To make these projects viable, MGL Partners applied a “capital recycling” model at Elevate @ Peña Station in partnership with the Colorado Housing and Finance Authority (CHFA). By setting aside 25% of units at 80% AMI with deed restrictions, MGL Partners achieved a balance between affordability and market-rate returns, creating a replicable model to meet growing demand for workforce housing. Workforce housing typically targets moderate-income individuals and families who are essential to the workforce but may struggle to afford market-rate housing. This approach involves using low-cost, short-term financing that can be repaid once the project stabilizes, freeing up capital for future developments.
The approach to financing Elevate @ Peña Station allowed for a low-cost subordinate debt layer, making it financially feasible to offer lower rents to local workforce residents. Upon stabilization, the project was recapitalized, enabling the original subsidy to be returned and redeployed into future projects including Hangar 61 @ Peña Station. Such creative funding solutions are essential to maintain a pipeline of attainable housing, allowing developers to reinvest in both workforce and market-rate housing while building a more comprehensive community fabric.
Public-Private Partnerships: Flexibility is Essential
Public-private partnerships (PPPs) remain critical for supporting housing solutions that encompass market-rate, workforce, and affordable units. In a region like Northeast Denver, where housing needs are diverse and continually evolving, PPPs allow public entities to team with the private sector to leverage their unique skills and resources for greater impact. These commitments don’t have to come with a big price tag – a little flexibility can go a long way in getting projects to pencil.
As persistently high interest rates and construction costs put additional pressure on development, flexibility within PPP structures is essential. Even simple public support can make a significant difference, like offsetting development costs through fee waivers, short-term subsidies, and tax incentives, and makes it financially viable for developers to include workforce housing within market-rate projects. By working together, municipalities and developers can create robust communities aligned with the region’s growth trajectory, ensuring both high- and moderate-income residents have access to quality housing.
The Path Forward: Scaling Complete Communities in Denver
With rapid population growth projected for Northeast Denver and Adams County, the region has an unprecedented opportunity to develop complete, mixed-income communities that reflect its residents’ diversity within sustainable, connected environments. By leveraging innovative funding, fostering public-private partnerships, and prioritizing inclusive growth, the development community can help ensure Denver remains accessible and vibrant. Projects like Hangar 61 @ Peña Station and Elevate @ Peña Station illustrate how communities thrive when they accommodate residents across income levels, fostering long-term resilience and economic vitality.
