February 4-February 17, 2015 —
COLORADO REAL ESTATE JOURNAL
— Page 13
Colorado Springs/So. Front Range
A shadow-anchored retail
center in north Colorado
Springs traded for $10.8 mil-
lion.
NetREIT UTC LLC, an affili-
ate of Net REIT Inc., a real
estate investment trust head-
quartered in Escondido, Cali-
fornia, paid $245.22 per square
foot, for Union Town Center,
which comprises 44,042 sf.
The buyer, which owns office
and
flex
p r o p e r t i e s
in the Colo-
rado Springs
market, was
looking to
d i v e r s i f y
its portfolio
within the
city, noted
Sperry Van
Ness’ Troy
Meyer.
“The transaction really made
sense for both buyer and
seller,” he added. “It was the
only asset the seller owned in
Colorado Springs. The buyer
benefitted by strengthening
and diversifying their existing
portfolio in Colorado Springs.
We view this transaction as
another positive sign of the
demand for commercial prop-
erty in Colorado and, especial-
ly, for the improving market in
Colorado Springs.”
Meyer, along with Sperry
Van Ness’ Dean Corey and
Kevin Matthews, and Nezar
Aweida of Re/Max handled
the transaction.
Union Town Center I LLC
and Union Town Center II LLC
sold the property.
Union Town Center is locat-
ed at 8666-8680 and 8810-8850
Union Blvd. and 3478 Research
Blvd. in the Briargate submar-
ket.
At the time of the sale, Union
Town Center was 97 percent
occupied. It was built in 2003
and 2006 and is shadow-
anchored by Albertsons.
Other News
n
Even though vacancy
increased by a sizable amount
in the fourth quarter of 2014, it
remained low enough for long
enough to support the stron-
gest rent growth during this
cycle of the Colorado Springs
apartment market, according
to
Apartment Insights’
latest
Statistics/Trends Summary.
The Colorado Springs vacan-
cy rate for conventionally oper-
ated, stabilized communities
of 50-plus units increased 62
basis points during the quarter
to 5.41 percent, offsetting the
third quarter’s 44 basis point
decline.
The trailing four-quarter
average vacancy rate increased
2 bps to 5.4 percent, but it
remains below the year-end
2013 average of 5.71 percent.
The summary noted that the
number of occupied, market-
rate apartments fell by 84 units
during the quarter, however,
larger gains in previous quar-
ters left 2014 with positive
absorption of 580 units for the
year.
In spite of the increase in
vacancy, rental rates increased
$7 to $832 per month, or $1.02
per square foot. The annual
rental growth rate jumped to a
record 7.2 increase, well above
the record 5.9 percent pace set
in the third quarter of 2014,
according to
Doug Carter
of
Sperry Van Ness/Doug Cart-
er LLC,
who co-authored the
report with
Cary Bruteig
of
Apartment Appraisers & Con-
sultants.
Five sales closed out the
quarter, averaging $95,556 per
unit. The yearly sales totals of
27 properties with 4,934 units
were well above 2013 totals
of 16 properties with 2,186
units. The annual dollar vol-
ume of just over $421 million
was more than double the 2013
sales volume.
While absorption for the year
was moderate, the number of
units in properties in lease up
also has fallen below 600 units,
the lowest since early 2013,
with just over 200 of those
units vacant, the report noted.
“This shows that the market
is comfortably absorbing the
moderate new supply being
added, also shown by a fall-
ing overall vacancy rate that
includes units in lease up plus
stabilized properties,” added
Carter.
Additionally, the report
noted that the slow and erratic
improvement in the rental mar-
ket over the last few years,
especially compared with the
metro areas to the north, has
kept the construction pipeline
at modest levels. While vacan-
cy is well below and rents well
above the averages of eight
years ago, the path to the pres-
ent “has been anything but a
straight line.”
“This irregular trend over
time, although improving on
average, has limited investor
confidence in the rental mar-
ket, creating uncertainty for
underwriters and developers.
Perhaps that has been a posi-
tive occurrence if long-term
market stability is the goal,”
said Carter.
n
Peter Scoville
and
Greg
Phaneuf
of
Colorado Springs
Commercial, a Cushman &
Wakefield Alliance
handled
both sides of
Xiotech’s
long-
term renewal.
The firm renewed its 35,361-
sf lease at Patriot at Interquest
III, 9950 Federal Drive in Colo-
rado Springs.
The landlord is
CV Patriot
Springs LLC.
n
NavPoint Real Estate
Group
executed several lease
transactions in Colorado
Springs, including
Smith Dun-
can LLC’s
lease of 7,082 sf of
retail space.
The tenant leased the space
in Dublin Plaza at 1824-1828
Dominion Way for three years.
Heather Taylor
and
John
Witt
of
NavPoint
represented
the landlord.
s
Union Town Center is shadow-anchored by Albertsons.
Troy Meyer
ʻWe view this
transaction as
another positive sign
of the demand for
commercial property
in Colorado and,
especially, for the
improving market in
Colorado Springs.ʼ
– Troy Meyer, Sperry Van Ness
