The residential real estate market in Steamboat Springs exploded in the months after the pandemic began, and now, investors are bringing that same level of interest to main street.
“I think just about everything is up for grabs in Steamboat,” said Cindy Hayek, who recently sold her building at 822 Lincoln Ave., where her business, Gigi’s Closet, has been located for the past five years. “The real estate market certainly made me change my concept. You just need to be flexible — that is part of being a business owner.”
Hayek said a friend of hers, who is a Realtor in Steamboat Springs, came to her with an offer in January and told her there was no commercial inventory in downtown Steamboat. The building was not on the market, but Hayek eventually accepted the offer and moved the inventory from Gigi’s across the street to Celebrations at 831 Lincoln Ave., another building Hayek owns. Hayek said the $1.22 million sale was one of four transactions she has made since the start of the pandemic.
Her current plan is to create a “mom and me“ concept for Gigi’s in the new space, but she said she has no plans to open the space until she has a clearer idea of what COVID-19 restrictions will look like this summer.
“I had to rethink my entire concept of the stores.” Hayek said.
Routt County Assessor Gary Peterson said there have been 13 transactions involving 14 properties in the Lincoln Avenue area since May 2020, including real estate, condominiums, restaurants and entire buildings. Those sales totaled $19,182,650.
Greg Breslau, an owner and broker with Colorado Group Reality, points to four prominent sales in downtown Steamboat in the past 180 days.
“The downtown market has really heated up,” Breslau said. “Historically, the commercial real estate market always lags the residential market. So we know how crazy the residential side of things are, and it took awhile for the commercial market to kind of rebound after COVID, and I think a lot of tenants and owners were really cautious and wanted to see how everything was going to play out.
“Now, I think there’s obviously light at the end of the tunnel, and we’re seeing a lot of activity,” Breslau added.
Those properties include 822 Lincoln Ave., where Gigi’s was located; the McGill Law Building at 1107 Lincoln Ave.; the building at 1125 Lincoln Ave., where Threads is currently located; and the building at 929 Lincoln where Sew Steamboat did business for more than a decade. All five were listed at more than $1 million.
“It’s all groups that have creative new concepts that are outside of the box,” Breslau said “They’re probably not going to be office buildings. People are getting creative, and they see how things are changing in Steamboat.”
Cam Boyd, an owner broker with Steamboat Sotheby’s International Realty, said he has seen the demand for commercial stretch beyond Lincoln Avenue. He is seeing a lot of sales in industrial areas, like along Elk River Road on the west side of town.
“The commercial and industrial is really hot right now,” Boyd said. “All you have to do is look at all the live-work stuff that’s been gobbled up and in the prices that stuff is going for. If it’s real estate, there’s the demand for it. It is not really just one sector or another. It’s everything from condominiums to commercial to industrial.”
Bart Kounovsky, with the Commercial Property Group, has seen a lot of real estate spikes during his time working as a broker in Steamboat.
“Every spike in real estate in Steamboat Springs has been unique over the years,” Kounovsky said. “Once again, this is a unique spike in regards to just the people that are coming to town that want to invest commercially.”
Kounovsky is not surprised by the demand in downtown and west Steamboat.
“We’re just seeing a lack of buildable lots for businesses and buildings in that area, because there really are no new land subdivisions coming into play.”
Breslau said he is not sure what the future market for commercial real estate in downtown Steamboat will bring, but with buildings selling for record per-square-foot prices, some longtime owners might decide to test the market.
“I’ve been here for about six years. I sold Old Town Square last year … right before COVID. Who would have known what was about to happen, but all those businesses weathered the storm,” Breslau said. ”I think it’s exciting to see what’s happening downtown, and I think the dynamics are changing, but it is still the place where a lot of tenants and new businesses want to be.”