Controversial Downtown Colorado Springs Apartment Tower Shrinks in Size, Developer Says

Controversial 36-story Apartment Tower in Colorado Springs Shrinks to 27 Stories Due to Funding Concerns

A proposed 36-story, 400-foot-tall apartment tower in downtown Colorado Springs has been scaled back to 27 stories and 300 feet, according to its developer, the O’Neil Group. The reduction in height was not due to community complaints about disrupting mountain views or skyline aesthetics, but rather because of funding concerns.

The original estimated cost of the project was $240 million, but the developers, in partnership with VeLa Development Partners, faced challenges in raising capital in a timely manner. Andy Merritt, chief strategy officer for the O’Neil Group, explained that the tightening real estate capital markets made it difficult to secure financing for the original project.

To address these funding issues, the developers reconfigured the apartment building to match what they believed they could finance, bringing the cost down to $202 million. The redesigned project includes 27 stories, 404 apartments, ground-floor retail space, and a four-level parking garage with 476 spaces.

The O’Neil Group and VeLa Development are seeking an urban renewal designation that would allow future property and sales tax revenues to help fund a portion of the project’s costs. Without this financial assistance, the developers have stated that the project would not be financially feasible.

Despite the changes in height and design, the developers believe that the new apartment building, now named One VeLa, will still appeal to young professionals looking for high-rise living in downtown Colorado Springs. The project is expected to include amenities such as a fitness center, conference room, and outdoor pool.

If all regulatory approvals are secured, the developers hope to break ground on the project in the second quarter of 2025, with completion expected in late 2027. The news of the building height reduction to 27 stories was met with mixed reactions from the Urban Renewal Authority members, some of whom questioned the extent of community objections to the original 36-story proposal.

Overall, the project continues to generate debate and discussion in Colorado Springs, highlighting the challenges and complexities of urban development in a growing city.