CREJ - Journal

42 / 88

Page 2AA — COLORADO REAL ESTATE JOURNAL — June 17-June 30, 2015
by Jill Jamieson-Nichols
Alocal investment group picked
up a Class B office building in a
ClassAlocation in theDenver Tech
Center for $6.45 million, or $139
per square foot.
ParadigmCapital Ventures’ Paul
Congleton said the 46,402-sf build-
ing at 5200 DTC Parkway fit his
group’s strategy of acquiring core-
plus to moderate value-add office
and industrial assets.
“It’s a quality B building in anA
location, and it was stable, which
offers the benefit of immediate
cash flow but still has, we believe,
some upside potential with amod-
erate rollover risk over the next
few years,” he said, adding rents
in the buildingwill be able to grow
as rates increase in the DTC sub-
market.
“Thebuildingoffersgoodupside
potential because rents have been
rising significantly for Class B
office properties in the southeast
suburban submarket, and the
rents in place are close to $3 per
square foot belowmarket on aver-
age today,” said PatrickDevereaux
of JLL, who represented seller K2
Ventures with JLL’s Jason Schmidt.
“The building has a tremendous
location at Bel-
leview and
I-25withwalk-
able access to
the Prom-
enade shop-
ping center,”
he said. “We
had tremen-
dous interest
in the asset
because of the
building’s locational attributes. It’s
rare to have an opportunity to buy
property under $20 million in that
location. It’s a great piece of real
estate at a ClassAlocation.”
The four-story building was
built in 1980 and fully renovated
over the last two years, Devereaux
said. It was 90 percent occupied
at the time of the sale. The largest
tenants are SystemDesign Interna-
tional, National Storage Affiliates
and State Farm Insurance.
“We’re actively pursuing other
opportunities in the market and
are interested in continuing to look
for opportunities similar to this
one,” Congleton said.
Other News
n Centennial Airport Plaza,
a two-story multitenant office
building in Centennial, recently
sold for $4.88 million, or $77.24
per square foot.
Denver-based Bradley Inves-
tors sold the property at 12150-
12200 E. Briarwood Ave. to
Melcor Developments Ltd., a
Canadian real estate develop-
ment and management com-
pany with plans to update the
property. The building was 88
percent occupied at the time of
the sale.
“One of the benefits of the asset
is it’s a traditional, two-story
office building in a market that
is predominantly single-story,”
said Patrick Devereaux of JLL,
who represented the seller with
JLL’s Jason Schmidt. The price
per sf was “significantly below
replacement cost,” he said.
Occupied by 26 tenants, pri-
marily local and regional com-
panies, the building was built
in 1983. “With the common-area
improvements, there’s a lot of
upside potential for this buyer,”
said Devereaux. “The rents in
place were about $3 a square
foot below market,” he said.
“The buyer does plan to do
a renovation to the lobby and
common areas and in turn will
have the ability to increase
rents.”
Tom Swan, a Scottsdale, Ari-
zona, broker, represented Mel-
cor in the transaction.s
Office
by Jill Jamieson-Nichols
Speculative office development
has returned to the southeast
suburban submarket with Prime
West breaking ground on One
Belleview Station, a Class AA,
transit-oriented building.
The 320,000-square-foot build-
ing at the northwest quadrant of
Interstate 25 and East Belleview
Avenue will be the first office
building in the 42-acre Belleview
Station master-planned develop-
ment. The 15-story LEED Gold
building, being developed in
partnershipwith Goldman Sachs,
will be delivered in fall 2016.
It will include an activated, fur-
nished lobby with a coffee bar,
dining and fitness center. The
building also will have access to
the Belleview light-rail station,
housing, shopping and dining.
“The two-minutewalk toRTD’s
Belleview Station platform, I-25
visibility and access, intelligent
floor-plate efficiency and a robust
array of walkable amenities
allows tenants to optimize the
combination of multimodal con-
nectivity and a high-quality work
environment,” Steve Clarke, CEO
of Prime West, said in a state-
ment.
Leasing agent Ryan Stout of
Cushman & Wakefield said there
is strong tenant demand in the
southeast suburban office market
for Class A space with immedi-
ate access to light rail and retail
amenities.
“Belleview Station is a remark-
able mix of office, housing,
shopping and dining options,
and because of this we have sig-
nificant interest in the available
space,” said Stout, who is han-
dling leasing with Cushman &
Wakefield’s Nate Bradley.
Tenants looking for more than
50,000 sf of Class A space in the
southeast suburban submarket
have “very limited options with
direct access to light rail,” said
Stout. Direct vacancy for Class
A space is under 10 percent, and
rates and demand continue to
escalate, with properties closest to
light rail experiencing the largest
increases, he said.
“This will undoubtedly be a
signature office site to support
our expanding business commu-
nity,” Denver Mayor Michael B.
Hancock said during the recent
groundbreaking. “We’re proud
to see smart development taking
shape, linking residents with jobs,
housing, retail and more.”
Clarke wouldn’t confirm or
deny the price Prime West and
Goldman Sachs paid for the
development site; public records
show the developers paid Front
Range Land and Development
$6.29 million for 3.16 acres.
“We are pleased to have such
strong partners in this endeavor,”
said Trey Warren, vice president
of Front Range Land & Develop-
ment Co. “The construction and
design quality of this building
rise to the high level already set
by the two Holland residential
buildings in the development and
should redefine what is possible
in a traditional suburban setting.
The buildingwill be an important
piece of our mixed-use puzzle
and create the kind of energy the
new breed of tenants are looking
for and not available elsewhere in
the market.”
Gensler’s Denver studio is the
architect for One Belleview Sta-
tion, which is being built by The
Weitz Co.s
Gensler designed One Belleview Station.
Centennial Airport Plaza is a two-story brick office building in an area
dominated by single-story properties. (See Other News).
The building at 5200 DTC Parkway offers a Class A location.
Patrick Devereaux
underground parking. There
will be 10-foot finished ceil-
ings and several outdoor ter-
races.
With completion of 1601
Wewatta, Hines has broken
ground on its next downtown
Denver development, 1144
Fifteenth, a 40-story, 600,000-
sf office tower.
The company owns and
manages nearly 1 million sf
of space in the Denver area. s
Hogan Lovells will be an anchor tenant in 1601 Wewatta, developed by Hines, Jordon Perlmutter & Co.
and institutional investors advised by J.P. Morgan Asset Management.