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Page 30 — COLORADO REAL ESTATE JOURNAL — March 4-March 17, 2015
Office
by Jill Jamieson-Nichols
Having completed its mission
at Logan Tower, DPC Develop-
ment Co. put the 69,968-square-
foot building on the market and
sold it for $10.5 million.
“Our goal is to buy value-add
and turn it into a core asset, and
that’s what we did,” said DPC
President Chris King. “We had
completed our mission.”
City Office REIT Inc., which
focuses on owning high-quality
office properties in attractive
Southern and Western U.S. mar-
kets, purchased the building,
which was 95 percent leased.
That compares with 88 percent
occupancy in 2012, when DPC
bought the asset for $5.85 mil-
lion and launched a major capi-
tal improvement plan.
“We upgraded the building
systems, the aesthetics of the
building and were able to renew
a majority of the lease turnover
that was coming,” said King.
“We leased quite a bit of the
vacant space and pushed rents.”
Located at 1580 Logan St.,
near the Colorado Capitol,
Logan Tower consists of seven
stories of office space above a
four-story parking garage. Its
21 tenants include nine state
agencies, including the Colo-
rado Energy Office, Colorado
Division of Water Resources and
state Department of Education,
among others.
CityOffice REIT said it expects
the building to generate an ini-
tial full-year cash net operating
income yield of approximately
8 percent based on the purchase
price.
“Logan Tower is well located
in Denver’s Uptown submar-
ket and is adjacent to both the
central business district and the
state Capitol. The property was
recently renovated and has a
diversified and stable tenant
base,” James Farrar, City Office
REIT CEO, said in a statement.
“The acquisition price is approx-
imately $150 per square foot,
which offers great value and a
significant discount to replace-
ment cost,” he said.
“Logan Tower provides an
attractive in-place cash flow
in one of our key target mar-
kets with substantial upside as
leases roll,” Farrar continued.
“The current gross rental rate is
approximately $18 per square
foot, which is an estimated $5
per square foot below current
market rates. Over the next five
years, we expect to generate
materially higher net operating
income as under-market leases
roll.”
City Office REIT paid cash for
the property, which will be con-
tributed to its credit facility as an
additional security.
Transwestern Managing
Directors Brad Cohen and Larry
Thiel, along with DPC’s Justin
Lutgen, handled the sale of the
asset, which generated numer-
ous offers, according to King.
“The Uptown district is home
to some of Denver’s most
prominent landmarks and is
considered one of the hippest
neighborhoods in Denver, with a
vibrant mix of urban culture and
the impressive stretch of 17th
Avenue’s Restaurant Row,” said
Thiel. “Logan Tower’s recent
performance is a testament to
the area’s popularity,” he said.
Vancouver, British Columbia,
Canada-based City Office REIT
is the third owner that Logan
Tower has had since it was built
in 1986. The company also owns
the Plaza 25 office complex in
Greenwood Village. s
Logan Tower was 95 percent leased at the time of its sale.
by Jill Jamieson-Nichols
A contractor that has been in
the same location for 25 years
is moving its headquarters to
Greenwood Village.
ISEC Inc. will move into 23,911
square feet at 6000 Greenwood
Plaza Blvd. inMay. The company
signed a 10-year lease with the
landlord, Lagomarsino Group.
ISEC is a prime trades contrac-
tor for general trades, architectur-
al woodwork, ornamental met-
als, doors, frames and hardware,
specialties, laboratory furniture
and medical equipment, accord-
ing to its website. It currently is
in 27,000 sf in Inverness Business
Park in Englewood.
According to Brendan Fisher of
Cresa, who represented the ten-
ant with Cresa’s Bruce Johnson
and Charlie Lutz, ISEC wanted
to upgrade its image. Also, it cur-
rently is split over two floors, and
the move will allow the company
to have all of its operations on
a single floor. Even though the
new space is smaller, it is a more
efficiently design and will allow
the company to add 10 to 20
employees, he said, adding it also
was more economical compared
with other options in the market.
Nate Bradley, Ryan Stout and
Zach Williams of Cushman &
Wakefield of Colorado Inc. rep-
resented the landlord in the
transaction.s