Cottonwood Communities Inc., a publicly registered non-traded real estate investment trust, has entered into a joint venture agreement to provide a preferred equity investment of up to $20 million towards the development of 2980 Huron, a 13-story, 299-unit high-rise multifamily apartment community located on nearly one acre in downtown Denver, Colorado.
The total development cost is estimated at $102.9 million, and the project is sponsored by an affiliate of CA Ventures, an international real estate investment and development firm headquartered in Chicago.
Cottonwood Communities will contribute up to $20 million at a preferred return of 12 percent per year, and its investment is positioned senior to $17.5 million in common equity from the developer. Additional funding will come from a $65.4 million construction loan.
Under the terms of the agreement, the REIT expects to receive an origination fee of 1 percent of its preferred equity investment, or $200,000. Construction is expected to begin during the first quarter of 2020, with completion slated for 2022. Onsite amenities are expected to include a pool deck, fitness center, and a co-working space and lounge.
“We are excited to partner with CA Ventures on this exceptionally well-located multifamily project in one of the nation’s fastest growing cities,” said Enzio Cassinis, chief executive officer of Cottonwood Communities. “At 13 stories, 2980 Huron will extend above the recently completed five- and six-story projects in the area allowing for unobstructed views of Downtown Denver and the Rocky Mountains from the upper floors.”
The project is within walking distance of Denver’s Union Station, Coors Field and Whole Foods Market, and is a short drive from major Interstates.