The newly established Denver Cultural Property Trust (DCPT) announced today that it has secured ZOMA Foundation as its purpose investor at $4 million alongside Pacific Western Bank as its senior lender at $4 million, fully funding the not-for-profit entity’s initial offering of $8 million so it can begin fulfilling its mission to acquire and develop more equitable housing solutions and enterprise spaces for the local cultural communities in Denver.
Established by Continuum Partners’ CEO Mark Falcone, the mission of the Denver Cultural Property Trust is to preserve important commercial spaces and residences on a long-term, affordable basis for artists and creative practitioners in the Denver community. The Trust’s unique ownership structure allows buildings purchased at market price to be leased to the city’s creative workforces and the organizations that support them at below-market rents. The Trust is a 501c3 and will be led by a board of directors. Continuum is working with other foundations to invest in the Trust as well.
“There has been an unprecedented dislocation of middle-income citizens, small businesses, creatives and cultural institutions that are an essential part of the ecosystem in urban centers with rapidly escalating rents like Denver,” said Mark Falcone, founder and CEO of Continuum Partners LLC and the Denver Cultural Property Trust. “We have been advancing an idea to create a new ownership vehicle designed to acquire and develop properties with the goal of lowering rents, not raising them. We will launch a larger version of this Statewide in 2022 that is aimed at Colorado’s working families. The Denver Cultural Property Trust is the first live version of the Trust. It has established the proof of concept for financial institutions, governments and investors. Our sights are now on scaling the platform to ensure we provide space and rent security to many more citizens across the State. I firmly believe that over the next 10 years, this platform can meaningfully shift and rebalance the housing shortages for the missing middle—60-120% of AMI.”
The DCPT will acquire strategically located residences and enterprise spaces that it intends to operate for the benefit of the cultural enterprise of the greater Denver Metropolitan area and lease them to qualifying enterprises or individuals. The Trust is a landlord that owns and operates the properties at a lower cost but does not provide any operating support for the tenants. Any cultural organization that chooses to locate in a Trust building will have to prove their ability to pay rent on an ongoing basis, albeit at lower and long-term stable terms.
The Trust’s first purchase was the Holiday Theater in Denver’s Northside neighborhood, a portion of which will be leased to MCA Denver for a seven-year term with the option to renew for two terms. There are additional street-level commercial spaces available for lease and the Trust will add artist studio spaces in the lower level of the theater for artists. The Trust will also manage the 15 apartments above the theater, which are currently all occupied. As tenants choose to move on and units become available, these apartments will be offered to income-qualified artists at below-market rates.
“What attracted us to DCPT is that it’s part of a larger initiative that Continuum Partners is working on to address the rapid loss of affordable housing in high growth U.S. Cities, Denver chief among them,” said Ben Walton, Co-Founder of ZOMA Foundation. “We want to be a partner in the realization of a vehicle that will provide a framework for addressing this issue on a larger scale.”
“Denver has been a leader in cultural offerings in the Mountain West for decades. Having recently established an Executive Office in Denver, we have seen first-hand the rising demand for housing equity across the region,” said Chris Erickson, EVP, regional manager for Pacific Western Bank’s Colorado Real Estate Group. “We have partnered with DCPT and ZOMA Foundation to begin addressing this issue by financing their project. We believe in their vision, acting as facilitator for necessary and positive change in the community.”
