East Colfax Motels Will Become Affordable Housing Units...in Six Years

Before Interstate 70 was constructed decades ago, Colfax Avenue was known as "The Gateway to the Rockies," lined with motels catering to cross-country travelers.

Monica Martinez, executive director of The Fax Partnership, always wondered if those aging motels could now become a gateway to affordable housing. In 2019, she presented the concept to the board of the Fax, a nonprofit dedicated to making improvements on East Colfax. The original idea was to buy the La Vista and Ahwahnee motels, but the organization didn't move fast enough; another purchaser is now turning them into market-rate apartments.

But in September, the Fax finally purchased two motels: the Sand & Sage at 8415 East Colfax Avenue and the Westerner at 8405 East Colfax Avenue.

After Denver shut down the Sand & Sage and the Westerner as public nuisances in 2019, Martinez reached out to the owner to see if he'd be interested in selling. She finally heard back this past April, and persuaded the board of the Fax to buy them. Then came "the mad scramble to find the right lenders and the right capital stack," Martinez recalls.

Enterprise Community Partners, a national nonprofit that fights for affordable housing and manages the Denver Metro Transit Oriented Development fund, invested over $2.2 million. The Colorado Housing and Finance Authority pitched in another $2 million, and the Latino Community Foundation donated $250,000 from its Communities of Color Loan. The Gates Family Foundation provided a $150,000 grant, and if Denver City Council approves, $983,000 in American Rescue Plan Acts will come from the Denver Department of Housing Stability. The Colorado Division of Housing may provide additional funding if the project gets approval from the Colorado State Housing Board.

Under Fax ownership, the buildings are still being used as motels, but the nightly rate has been lowered 20 percent. Next fall they'll be converted into shelters; Volunteers of America Colorado will lease them.

Volunteers of America Colorado has owned The Volunteers of America Family Motel, now a homeless shelter at 4855 West Colfax Avenue, since the early 2000s. According to CEO Dave Schunk, the building is past its lifespan and will soon be torn down; VOAC will replace it with the Theodora Family Motel, a new building with temporary housing for the homeless, as well as an affordable housing unit.

While the Theodora is being constructed, former residents of the Family Motel will move to the two motels on East Colfax for about twelve to eighteen months. "This was extremely timely for us and the Fax," Schunk says of the partnership. "We had these families we don't want to disrupt."

The motels currently have forty units combined, although only 28 are usable; the previous owner updated those. The city and state are providing some funding to rehab additional units, but the Fax doesn't want to put too much money into motels that are eventually going to be torn down, Martinez notes.

Ultimately, the Westerner and Sand & Sage will be demolished and replaced with new affordable housing units on the 33,000-square-foot site. But that plan will have to wait: A large billboard stands on the property, and its lease runs until 2028. "There’s no building around that billboard," Martinez says. "We went to the billboard company and said, 'Can we buy you out?' and they said, 'No, no, no, they stay until the last second of the day.' It means now when VOAC leaves to go back to their nice new building, we will continue these as a shelter, whether through our own organization or a third party."

Once the sign comes down in 2028, the Fax will develop a multistory complex of between 100 and 120 units of affordable housing. Denver City Councilman Christopher Herndon, who represents District 8, is sponsoring a rezoning proposal that would allow the project to be built. The vision also calls for a library or community center on the first floor, in keeping with the 2020 East Area Plan.

According to Martinez, any new housing in the area is helpful, even the pricey condo project that recently inspired a protest by East Colfax residents. "If you’re a young person or a young family trying to buy a home in the Denver metro area, there is nothing available under $800,000," she says. "I'm a firm believer that we just need more units."