The biggest story in Denver real estate this week has been the sale of former Denver Broncos coach Mike Shanahan's mammoth Cherry Hills Village home for $15.725 million. The transaction even earned coverage in the Wall Street Journal, which reports that it was "the priciest single-family deal ever recorded in the metro Denver area."
But a more telling story lingers beyond the headlines. Shanahan's home had been on the market since July 2016, when it was originally listed for $22 million — more than $6 million over the amount Shanahan ultimately accepted. And while the home itself is uncommon, the difficulties of selling a luxury property in the metro area aren't.
While metro Denver's real estate scene has experienced enormous growth over recent years as one of the hottest markets in the country, houses priced in excess of $1 million have been in considerably less demand. During the past two years, as demonstrated by data accessed for Westword by Jim Smith of Golden Real Estate, one of the most knowledgeable observers of the recent boom, hundreds of pricey pads have gone unsold, with many taken off the block owing to a lack of serious interest.
As Smith notes, the rising number of expired (read: unsold) listings each month is "a reflection of people asking too much, like Shanahan, for their homes because of their sense that the seller’s market will bring them outrageously high prices."
Of course, Shanahan's old place, at 8 Cherry Hills Park Drive, is extraordinary. Back in January 2010, around the time he agreed to coach the Washington Football Team, we pointed out that when the home was still in the building-permit stage a couple of years earlier, the Denver Post was already touting its size and scope: nearly 35,000 square feet of space, including "a bowling alley and lounge, a poker room, a video-golf room, a racquetball court and a shuffleboard table... And that's just in the basement, where there also will be four bedrooms." Other items on the blueprint: "Six fireplaces; a 3,600-square-foot, six-car garage; a 2,150-square-foot guest house; a 'wine residence' and guest house; a swimming pool; and two bridges."
Because of Shanahan's East Coast gig, the finished spread was sitting empty in 2012 — a lucky break for Peyton Manning, who reportedly stayed there while hunting for his own house after being signed by the Broncos. Four years later, Kentwood Real Estate DTC's Sandy Weigand scored the listing and went all out in promoting a sale, even creating a website specifically for the property that remains online, as well as multiple video tours like this one:
Other luxury homes in Denver have lingered, too, as evidenced by Multiple Listings Service, or MLS, statistics via REcolorado from October 2019 to September 2021. During this span, million-dollar-plus properties have routinely sold for below their asking price, with pending and completed sales representing a relatively modest percentage of overall listings in the category. Meanwhile, dozens of luxury listings expired each month, including 85 in both August and September of this year.
Here's the rundown:
In May, June and July, the median number of days that million-dollar homes were listed on the MLS fell below ten, a figure Smith regards as "remarkable." But by September, he adds, "it was already triple those figures. You can also see that the median ratio of closed price to listing price, which was 100 percent in the summer, is halfway back to the pre-pandemic level of 95 percent."
Smith believes that sales of houses priced under $1 million have finally peaked, too — and if the demand for dwellings accessible to regular folks is falling, interest in mansions could tumble even more. In that case, Shanahan's decision to take much less than he'd hoped for his Cherry Hills Village palace will look very smart.
No wonder he's nicknamed the Mastermind.