Colorado Real Estate Journal - February 4, 2015
A San Francisco-based company recently paid $53.55 million for a 408-unit apartment community in Lakewood. Fowler Property Acquisitions, which operates a portfolio of about 22,500 apartment units valued at $2.3 billion, bought Elevate at Red Rocks at 13105 W. Second Place. The seller was Fairfield Residential of San Diego. David Martin and Pam Koster of Moran & Co. listed and marketed the community. “We received a lot of interest in it,” Koster said. ‘”We ended up receiving about 20 bids on it,” she said. The comm u n i t y , which is near Red Rocks C o m m u nity College, was built in two phases, Koster said. The first phase was in 1981 and the second in 1999, she said. “It was a value-add play, but at two different levels because of the different time frames of construction,” Koster said. The older phase, she said, needs more extensive upgrading than the newer phase. FPA was extremely familiar with the area and they like the Lakewood market, she said. “They own Westhills, which is virtually next door, so buying Elevate at Red Rocks made a lot of sense for them,” she said. Westhills has 400 units, giving FPA a critical mass of more than 800 units in one location, she noted. Koster said Lakewood is increasingly popular to real estate investors. “When you look at the rental submarket, you are 15 minutes from downtown. “While the newer product in downtown is getting $2 per square foot, in Lakewood a lot of properties are available for $1.25 per square foot,” Koster said. The west side also is an extremely tight apartment market, with few vacancies, she said. The low vacancy rate allows owners to raise rates, especially after they upgrade units, like FPA plans at Elevate at Red Rocks. Some of the newer projects in Lakewood are getting about $1.80 per sf, Koster said. Not only is Lakewood an easy commute to Denver, either by car or light rail, but also she said the area is its own employment center. “You look at that market area and there are health care jobs, government jobs and retail jobs,” she said. “Investors feel like the west side is a very stable market,” Koster said. FPA paid $131,572 per unit and $142 per sf for the Elevate at Red Rocks. “Blended, I think they paid below replacement cost, when you consider the age difference between the two phases,” Koster said.
Kennedy Wilson of Beverly Hills paid $20.75 million for the 143-unit Villas at Holly apartment community at 6760 S. Glencoe St. in Centennial. This was part of an area portfolio sold by DiNapoli Capital Partners LLC of San Jose, California. ARA brokers Jeff Hawks, Doug Andrews, Terrance Hunt and Shane Ozment listed and marketed the community on behalf of DiNapoli. An unidentified buyer paid $980,000 for an eight-unit apartment building at 3030 Williams St. in Denver. The sale price for the building in the Whittier neighborhood equates to $122,500 per unit. Kyle Malnati and Greg Johnson of Madison Commercial Properties brokered the sale. “The sellers purchased this property from the previous owner in 2013 for just $425,000 and immediately began doing impactful interior renovations,” said Malnati. After owning the property for less than 18 months, they decided to sell. “It’s incredible, really,” Malnati said. “The sellers more than doubled their initial investment in little time by executing a fantastic renovation plan,” he said. The renovations paid off not only as far as getting a high price, but also as far as a quick sale. “We knew it wouldn’t take long to find the right buyer to seize this opportunity, and we were right,” Johnson said. “The buyer, who plans to selfmanage the property, is thrilled to have added this to his growing central Denver portfolio,” Johnson said. An unidentified buyer paid $650,000 for the York Mobile Home Park at 4765 York St. in Denver. The park includes 17 singlewide trailers and a single-family home. The purchase equates to $36,111 per space. Josh Newell, a senior adviser at Pinnacle Real Estate Advisors LLC, handled the transaction. An unidentified local buyer paid $420,000, or $105,000 per unit and $128.67 per square foot, for a four-unit apartment building at 3744 Vance St. in Wheat Ridge. The property was constructed in 1959. Newell and Zane Wells, an associate adviser at Pinnacle, represented the buyer in the transaction.