The Wellington E. Webb Municipal Office Building is the workhorse of Denver’s real estate portfolio, providing space for 2,100 employees across departments from the Clerk and Recorder’s Office to city planning to parks and recreation.
Now, more than 20 years after it was built at 201 W. Colfax Ave., work is underway on a $133.5 million overhaul. The renovation will touch all 12 floors of the gray, oval-shaped office tower north of Civic Center park over the next two years.
And even while it’s under construction, the Webb building is playing a part in Mayor Mike Johnston’s economic plans for downtown Denver. Displaced employees won’t be working from home — while their typical office spaces are being painted, carpeted and furnished with new equipment and gear, they will simply shift a block or two away.
Thanks to some carefully planned phasing and a $4.9 million lease for space in nearby Republic Plaza, city workers will remain on hybrid work schedules that keep them coming downtown at least three days per week, according to Lisa Lumley, the city’s director of real estate.
“By all accounts, we anticipated everybody could work from home,” Lumley told City Council members last month about the city’s initial plans for disruptions in the Webb building. “When Mayor Johnston took office … he had asked us to reevaluate this — from an economic development, revitalization standpoint downtown, to reconsider and go back out and find very inexpensive space.”
The Webb renovation is designed to set the building up to be a functional hub of local government into the future. Officials project that the city will need seats for 600 more office workers downtown by 2027, and that is not possible in a building occupied by bulky office furniture that’s well spread out under the original floor layouts.
Some of it is so old that the manufacturers are no longer making replacement parts.
The project will improve capacity, catch up on decades’ worth of maintenance needs and improve accessibility to meet Department of Justice standards for public buildings. That means lowering drinking fountains and kitchen counter heights, adjusting bathroom stall sizes and more, according to city spokeswoman Laura Swartz.
The building was named after the still-living former mayor, who left office in 2003 — just after the building opened in late 2002. It cost $132.4 million to build, which is nearly $230 million in inflation-adjusted dollars.
As city officials looked for outside office space to accommodate the rotating moves into and out of the Webb building, they opted to piggyback on another recent city deal for space in the 56-story Republic Plaza, Denver’s tallest building.
The agreement, approved by the council in October, added 72,000 square feet of furnished office space to a $49.9 million lease inked there in June to house the Denver District Attorney’s Office through 2036. The DA’s relocation also will free up future space in the Webb building.
Before the council’s recent 9-4 vote on the added space, Lumley explained to some skeptical members that the decision to lease more space at Republic Plaza was, in part, about ensuring smooth operations for city teams. They include portions of the Department of Transportation and Infrastructure that officials found did not thrive in a work-from-home environment, she said.
But the extra space became even more urgent after Johnston took office. During the spring mayoral campaign, he made downtown revitalization a priority of his successful run for the city’s top office, arguing that keeping city workers circulating through the area — and spending money on lunches or shopping — supports that goal.
Keeping city workers downtown most days
Johnston pledged $58 million in spending toward that revitalization goal in his first budget as mayor. In a letter accompanying his initial budget proposal in September, the mayor highlighted the importance of office real estate to downtown’s success.
“Our downtown faces among the highest commercial vacancy rates of any city in the nation,” he wrote. “Reversing this trend will require a coordinated effort to revitalize not only the Central Business District but create a central neighborhood district where people of all income levels gather year-round.”
Republic Plaza is an example of the office market strain. It made headlines earlier this year when its ownership group reportedly was struggling to make payments on a loan that could have landed the building in foreclosure.
But Lumley assured council members that the issue had been resolved and didn’t pose a threat to the city’s plans since the building’s owners were never in default while they restructured their loan.
That lease isn’t the city’s first move into nearby private office space in recent years.
It also has subleased space from The Denver Post’s ownership group in 101 W. Colfax Ave. The downtown building facing Civic Center still bears The Post’s name but is no longer home to the newspaper’s offices.
That arrangement dates back to 2016, when the city secured two floors to make room for its ballooning employee head count. The city has since grown its footprint and amended its deal there at least six times, most recently in September. The city’s cumulative sublease total in the Post building, including rolling expiration dates through 2029, is now just shy of $44 million.
Some downtown stakeholders celebrated the decision to maintain city workers’ presence in the Central Business District, the eastern segment of downtown that was struggling with a lack of activity even before the pandemic sent many office workers home in 2020 for an extended period.
“We are really grateful for Mayor Johnson having the vision to not only improve the Webb building so city employees can be downtown in the long term, but to keep them downtown in the interim,” said Britt Diehl, a spokeswoman for the Downtown Denver Partnership.
Government workers — city, state and federal — are the second-largest segment of workers in downtown Denver, Diehl said, with a combined 25,000 stationed in the area.
Even on hybrid schedules, when thousands of them may stay home on a given day, that presence makes a difference in a city where the partnership is tracking a 30% office vacancy rate. It’s most concentrated in the blocks near the Webb building.
“City employees can be ambassadors” for downtown
Councilman Chris Hinds, now in his second term, saw the boundaries of his centrally located council District 10 expand this year to include more of downtown. He knows how tight space is in the historic City and County Building, where he keeps his office.
That makes the Webb building — which doesn’t have the limitations of its historic neighbor — critical to keeping up with the needs of city business and residents.
Maintaining a municipal employee presence downtown during construction shows the city is leading by example, he said.
“City employees can be ambassadors for those who haven’t visited downtown in a couple of years — who maybe had a bad experience” during their last visit, Hinds said. “Downtown is a better place than it was even two years ago. And (in) the next year, once we start opening up blocks of the (under-construction) 16th Street Mall … we’re going to find that people really enjoy the new downtown experience.”
The city is financing the Webb building’s renovations using up to $300 million worth of certificates of participation, a form of borrowing that pledges city assets and, unlike municipal bonds, is not subject to voter approval. That amount also covers plans to refinance some old city debt that remains from when the building was first built, officials said this summer.
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When it’s all said and done, city officials expect the Webb project to allow them to move all of the roughly 600 employees currently working in the Post building back to city-owned space.
But that doesn’t mean Denver won’t remain a real estate player downtown outside of the Webb building’s curved walls.
According to Lumley, the city is considering a potential purchase, at some point, of the Post building. It’s not owned by the newspaper or its ownership group, but they hold a long-term lease of several floors, which they have subleased to other tenants, including the city.
“We’re keeping all options on the table to meet the city’s space needs,” Lumley wrote in an email when asked about the city’s future plans in the Post building. “As we free up space there by bringing city agencies back into the Webb Municipal Building in the coming years, we are also considering the future best use of this downtown office building for other public services.”
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