Page 10 —
COLORADO REAL ESTATE JOURNAL
— August 17-September 6, 2016
Multifamily
by John Rebchook
When apartment developer
Lauren Brockman was unveil-
ing his plans for an apartment
community on the former Mercy
Hospital site, he expected the
soft apartment market of 2004 to
be much stronger when the 240
units in three buildings opened in
18 to 24 months.
"Where else are you going to
have a multifamily community
like this up against what is really
the largest urban park in Den-
ver? This is a great location that
can't be duplicated," Brockman
told the Rocky Mountain News
in 2004.
Fast-forward a dozen years.
IMT Capital recently paid
$70.95 million, or $295,625 per
unit, for the community at 1600
Fillmore St.
The seller was a Blackstone
Group entity.
New York-based Blackstone
Group, one of the largest real
estate investment companies in
the U.S., paid $57.95 million for
the property in 2014, according to
public records.
That equates to a 22.4 percent
gain on its investment in two
years.
It was called Retreat at the Park,
but California-based IMT has
renamed it as IMT at City Park.
Blackstone was represented in
the transaction by Jordan Robbins
and Jeff Haag of the Denver office
of HFF.
Although Brockman initially
developed the site in 2004, the
community is a hybrid of the old
and new.
“Actually, it was a redevelop-
ment,” Robbins said.
“It was three buildings. One of
them was redeveloped from the
old hospital,” Robbins said.
“Mercy Hospital had used that
building as an old administrative
building. I think it was built in the
1920s. The other two buildings
were developed by Lauren Brock-
man around 2005,” he said.
IMT outbid a number of com-
petitors to land the community.
“There was a ton of interest,”
Robbins said.
“We showed it more than
25 times. Maybe even 30-plus
times.”
Offers came from California,
Texas and other states, as well as
from Colorado, he said.
Awidemix of buyerswanted it.
“We had offers from individual
funds, high-net-worth guys and
a lot of interest from institutional
investors,” Robbins said.
Brockman was right on target
when he described the develop-
ment as a rare opportunity.
“It is really hard to get that kind
of scale in the City Park area,”
Robbins said.
“It’s a great location, right
across from City Park,” he said.
The area has improved
immensely since Brockman first
developed it.
Today, its proximity to East
Colfax, putting it within walking
distance of many trendy bars and
restaurants, is a big selling point.
In the mid-1980s, Colfax was still
a gritty street that had not yet
turned around.
“It also has a value-add com-
ponent, especially with an older
building,” Robbins said.
The mix of the old and new
also makes it attractive to a wide
range of renters, he said.
“You have the older building,
as well as more modern units,”
Robbins said. “You don’t find that
kind of mix in many apartment
developments. You have really
unique floor plans in the older
building. Some new buildings
have cookie-cutter floor plans,
but that is not the case here.”
Barriers to entry made it that
much more attractive to inves-
tors, he said.
“The lack of opportunities to
build competing product in the
area drove a lot of the interest,”
Robbins said.
Other News
n
An unidentified buyer
paid $6.6 million for the 50-unit
Maryel Manor, which provides
government-subsidized housing
at 12555 Sheridan Blvd. in Broom-
field.
The sale price for the 3-story
building built in 1983 equates to
$132,000 per unit.
Jules Hochman
and
Justin
Brockman,
senior advisers at
Pin-
nacle Real Estate Advisors LLC,
represented the seller in the trans-
action.
n
An unidentified buyer paid
$1.25 million, or $140,625 per unit
and $120.32 per square foot, for
an eight-unit apartment building
at 9493 W. 14th Ave. in Lake-
wood.
The building is two blocks from
the Garrison light-rail station.
Robert Lawson,
a senior advis-
er at
Pinnacle Real Estate Advi-
sors,
represented the buyer in the
transaction.
“The high demand for apart-
ment buildings priced below $2
million in the Denver metro mar-
ket makes it very challenging for
investors to successfully compete
for properties,” Lawson said.
His client was not the first
investor seeking the property.
“When we first looked at this
opportunity, it went under con-
tract before we had time to evalu-
ate the true potential,” Lawson
said.
“However, the property fell out
of contract and came back on the
market so the first day we toured
the property we wrote an offer
and secured the deal quickly,”
Lawson said.
“This property was the buyer’s
first acquisition in the Denver
market, and he was able to find
a quality asset in a great location
within walking distance to light
rail and with immediate upside
in rents,” according to Lawson.
“He plans on renovating a few
of the units and holding onto the
property long term,” he said.
n
An unidentified buyer paid
$977,500, or $166,250 per unit and
$166.25 per square foot, for a six-
unit apartment building at 2210 S.
Dexter St. in Denver.
Kevin Calame
and
Matt
Lewallen,
senior advisers at
Pin-
nacle Real Estate Advisors,
rep-
resented the sellers in the deal.
“The owner took advantage of
this seller’s market and will be
trading into a triple-net retail deal
with a higher cap rate and less
management-intensive invest-
ment,” Calame said.
s
IMT paid $70.95 million for this apartment community along City Park.
