Peak Innovation Park, the business park owned by the Colorado Springs Airport, has landed another distribution center and negotiations are underway to soon bring another major employer to the city’s largest commercial development.
The 104,000-square-foot distribution center will be built just south of the military rapid deployment terminal and is a major milestone for the 1,725-acre park because it requires construction of roads and utilities that will open the eastern end of the property south and east of the airport’s main runway. The project is also the first new construction started in the park since a Denver developer began work in 2021 on an office building that was completed earlier this year.
Peak Innovation Park is about 20% developed with Amazon’s 4 million-square-foot fulfillment center, 278,000-square-foot sorting facility and a 65,000-square-foot delivery station as well as offices for defense contractor Northrop Grumman and research nonprofit Aerospace Corp. and the office building, the first in the Peak Technology Campus. After a slow start, the park has become a major success story in the past five years with Amazon’s arrival and a recent Aerospace Corp. expansion.
The new Frito-Lay center could be the start of another round of development in Peak Innovation Park. Troy Stover, the airport’s director of the development for the park, said five other projects are in lease negotiations or the discussion stage that would use another 170 acres. That could include the first retail and restaurants to open in the park in the next year or so as well as some office and industrial projects that could happen during the next few years.
“Peak Innovation Park is a major economic driver for our community. We commissioned an economic impact study that found the park generates a $1.6 billion annual impact on the local economy, or nearly 5% of the region’s economic output,” Stover said. “We have had a high level of interest for 6 or 7 years but with higher interest rates and inflation, companies are taking more time and being more methodical in making a (relocation) decision.”
A Bobcat tracker works on the site of a two-hotel complex Tuesday in the Peak Innovation Park near the Colorado Springs Airport. The project was delayed earlier this year, but construction on the 142-room Residence Inn is expected to resume later this year. The second hotel will follow in late 2025 or early 2026.
The Amazon and other facilities already in the business park total nearly 5 million square feet and employ more than 5,000 people. Another 10 million to 15 million square feet of space could be built on the park’s remaining land over the next 20-30 years, enough to accommodate 25,000 additional employees. Roads and utilities in the park are financed through bonds issued by seven metro districts that are repaid through taxes paid by the park’s property owners.
Peak Innovation Park is among the state’s largest business parks, about twice the size of the Denver Technology Center, and has been a magnet for aerospace and defense contractors due to its proximity to Peterson Space Force Base and the military commands housed there, including U.S. Space Command and Northern Command. No residential development is allowed in the park since it is located adjacent to two of the airport’s three runways.
North Carolina developer SunCap Property Group is building Frito-Lay’s distribution center, which is scheduled for completion in June. Frito-Lay, part of food and beverage giant PepsiCo, didn’t respond to an email seeking details on the facility, however other distribution centers of similar size opened in recent years each employ about 100 people. SunCap bought the 12-acre site for the center in June for $4.42 million and will lease the center to Frito-Lay, according to El Paso County land records.
SunCap is no stranger to Colorado Springs or the state — the company also developed Amazon’s fulfillment center and a nearby FedEx distribution center as well as several office, industrial and distribution facilities in the Denver area.
The airport is building $14 million in roads and utilities to open access and enable development of not just the Frito-Lay center but also eventually will serve about 700 acres east of the site that were added to Peak Innovation Park in 2021. That land had been released from aviation use but had never been added to the park until the Amazon, Aerospace and other details that built development momentum and fueled more interest among both developers and potential tenants.
A passenger jet flies over the Peak Innovation Park Tuesday, Aug. 15 as it departs the Colorado Springs Airport.
“The airport and Peak Innovation Park are both economic engines that feed each other. This latest deal (with SunCap and Frito-Lay) is fueling both engines by bringing jobs to the community and infrastructure for more development in the park,” Stover said. “We want to get the infrastructure (on the park’s east side) completed ahead of future demand so we can bring that land to the market quickly – during the next one or two years.”
Garrett Baum, managing partner of Denver-based Urban Frontier, which is developing Peak Innovation Park for the airport, said the company is getting “an incredible amount of interest for additional acreage added to the park, including some larger parcels.” He said negotiations with potential tenants that have been underway in recent months would result in “very good employment – thousands of jobs – and significant investment” if agreements can be completed.
Interest in Peak Innovation Park has been high among commercial real estate agents — more than 60 attended a briefing in June to get an update on the project and future development plans, a major turnaround from the skepticism agents showed a similar meeting five years earlier.
“We are proving the doubters wrong. They had expected all the growth to happen up north in Briargate and Interquest,” Baum said. “The largest percentage of (commercial real estate) growth has been in the park or in and around the airport. Peak Innovation Park is now on the map.”
The park’s next tenant likely will be a tenant in the 50,000-square-foot first building of Peak Technology Campus developed by Denver-based Flywheel Capital south of the airport’s military rapid deployment terminal. The company hopes to complete lease negotiations by year’s end with an aerospace and defense contractor, which officials declined to identify, for a major part of or the entire first building, said Ben Hrouda, Flywheel’s managing director.
Flywheel has submitted plans for city approval of the remaining three buildings planned for Peak Technology Campus, which would total 200,000 square feet when all four structures are completed. The company also has submitted plans for city approval to build the first of a pair of three-story office buildings in the park that would total 240,000 square feet. No timetable has been set for construction for either project but work likely won’t begin until the first building is leased.
Peak Technology Campus is designed for aerospace and defense companies by not including lobbies or other common areas shared with other tenants — each will have a separate entrance to maintain security, said John Fefley, Flywheel’s senior director. The space also was built with a flexible floorplan so contractors can quickly complete the interior of the building to their specifications and ramp up operations after winning military contracts, he said.
Another coming attraction to the park will be a small retail center and restaurants to serve tenants and their employees — the nearest restaurants are either in the airport’s passenger terminal or several miles away. The first retail and restaurant development likely will be built adjacent to Amazon’s three-building complex at Powers and Grinnell boulevards with more to follow at the airport’s entrance at Powers and Milton E. Proby Parkway as well as at the park’s southern end.
Peak Innovation Park and the surrounding residential neighborhoods are “an underserved market for retail, restaurants and those types of services right now,” said Urban Frontier’s Baum. “We are negotiating with a mix of local and national tenants that would bring those services to the park, the surrounding neighborhood and the airport. We hope to be under construction by early next year with some opening in late 2024 or early 2025.”
Stover said design work is underway on the first phase of the park’s planned trail system and the first of two disc-golf courses with construction on both scheduled to begin next year. A second disc-golf course and small outdoor amphitheater are also planned in later phases.
Developers of a planned two-hotel complex in the park also are hoping to soon resume construction on the first lodging, a 142-room Residence Inn. Jim DiBiase, a local developer and partner in the project, said work on the hotel stalled earlier this year after completion of the foundation, utilities and elevator shafts when one of the partners in the project withdrew and the construction lender pulled out due to rising interest rates, surging inflation and other market conditions.
DiBiase and the remaining partners are raising capital for the project and negotiating with a new lender that would allow construction to resume in the fall and enable the hotel to open in late 2024. The second hotel, likely a 130-room Courtyard by Marriott, would follow in late 2025 or early 2026. The two hotels would share a lobby and meeting space and would be the closest of any hotel to the airport’s passenger terminal.
In reaction to the news, Colorado Springs Mayor Yemi Mobolade told The Gazette: “Peak Innovation Park is an incredible asset that’s bringing positive development to southeast Colorado Springs. This large and attractive property is owned by the airport, which means we can help build it with a high level of intentionality and purpose. The team is doing great work in identifying industrial, business and entertainment options that can be enjoyed by all. The future of this area is bright.”
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