Two years ago, Denver built its hopes – and most likely its budget – on the purchase of the former Denver Post building in downtown with plans to add office space for courts.

In January 2024, Denver bought the sleek, modern building, complete with its own marquee, for $88.5 million, assuming the building’s lease with The Denver Post, its anchor tenant.

City officials hoped that existing lease payments, as well as future occupancy from city entities, such as court and legal services, would make the 306,000-square-foot building profitable.

But, as of August, the city’s largest tenant and master leaseholder, DP Media Network LLC, had ceased making its monthly payments of $649,550 on the building, adding additional strain to the city’s budget.

DP Media Network LLC — the legal name of the Denver Post — missed its first payment on Aug. 1, according to a default notice sent by the city for not only the rent due but also an additional $32,477 late fee.

Mayor Mike Johnston’s office is aware of the situation, and a spokesperson said the city’s finance department has been working through the details for the past couple of months.

“Denver pays its debts on time, and DP Media Network should do the same,” said Denver spokesperson Jon Ewing. “We are working with the tenant to restart payments and intend to recover every penny we are owed.”

In an article, the Denver Post said DP Media Network LLC offered to buy out its lease with Denver and that the company hopes to reach a mutually beneficial arrangement.

“We stopped occupying this space while the building was under private ownership long before the city purchased it, so there was never any impression we would be using the space when the city made the decision to purchase the building,” the Denver Post quoted Marshall Anstandig, the general counsel for The Post’s parent company, MediaNews Group, as saying.

Alden Global Capital owns MediaNews Group.

While the building still carries its name, The Denver Post has not operated out of the downtown building for years.

City finance officials told The Denver Gazette the city has been pursuing the matter legally since it first issued the notice of default. 

As it stands, not counting any additional late fees, The Denver Post owes the city close to $2 million – money the city could use to cover some of the City Council’s budget priorities.

Looking at the numbers, that $2 million could pay to restore the city’s STAR Program ($500,000), Denver Day Works ($550,000), WorkReady Program ($600,000), and Crisis Response Team positions within the Denver Sheriff’s Department ($286,000).

Alternatively, the owed cash could fund the 17 additional positions the council asked for as part of the Department of Transportation and Infrastructure’s Right of Way Enforcement Funding ($1,360,000).

The city, which began leasing space from the owner of The Denver Post back in 2016, occupies 50% of the 101 W. Colfax building and, prior to the purchase, paid about $5 million annually.

Historically, members of the City Council have had reservations about buying the building, even postponing the decision to approve the purchase, citing cost concerns and the need for more information.

“This is devastating for the people of Denver,” said Councilmember Flor Alvidrez about the tenant’s failure to pay rent. 

She posted on her Facebook page on Tuesday afternoon: “This deal was never a good deal.”

“The City knew this risk existed, and now accountability has to be front and center,” she added. “I’m digging into how this deal was made, what safeguards were (or weren’t) in place, and how we protect taxpayers going forward. I won’t let this get swept under the rug. One of the reasons I voted no on this is because (the) council never got all the information.”