Colorado Real Estate Journal - December 17, 2014

Philadelphia buyer pays $6.15M for distribution center

by Jill Jamieson-Nichols

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Revere Distribution Center, a high-quality flex building in the Denver area’s southeast industrial submarket, traded for $6.15 million, or $103.71 per square foot.

The 59,270-sf building at 7025 S. Revere Parkway in Centennial was 100 percent leased at the time of the sale. It received strong investor interest.

“It was definitely a very active bidding process. You had four very qualified groups going after it. Three of the four groups normally look at much larger deals,” said Transwestern Managing Director Brad Cohen, who handled the sale with Larry Thiel, also a managing director in Transwestern’s Capital Markets group.

Exeter 7025 S. Revere LLC, an entity formed by Philadelphiabased Exeter Property Group, acquired the asset from LNR Partners LLC, the special servicer for the property.

“There are limited opportunities like this in the metro area right now. It’s stabilized. It’s a flex asset. It’s also very unique for that submarket,” said Cohen.

The building offers great functionality, including 24-foot clear height and “a perfect mix” of office and warehouse space to appeal to a range of tenants. “It’s just very, very functional,” Cohen said.

Plus, “Vacancies within Denver and the Centennial industrial market are very low right now and continue to decline,” he commented.

Revere Distribution Center was built in 1997 and is leased to three tenants: Eagle Flooring, MasTec and Accu-Tech.

Other News

Fleet Direct Properties purchased a property at 5565 E.

52nd Ave. in Commerce City for $1.7 million. The buyer is affiliated with Fleet Direct, which brokers fleet vehicles for large organizations. It is relocating from an existing facility.

The company needed additional yard area for its vehicles, which the 3.33-acre property will provide, according to Peter Beugg of JLL, who represented the company with JLL’s Tyler Reed. The yard is fenced, paved and secured.

The property includes a 17,600-square-foot industrial building with 12,960 sf of office space, plus drive-in and dockhigh doors, and has easy access to Interstates 70 and 270, and Denver International Airport.

The twin-T building was constructed in 1974.

Alex Ringsby and Scott Patterson of Ringsby Realty represented the seller, a private individual.

An industrial building in Montbello was placed under contract in less than two weeks, selling for $105.61 per sf.

MM Technology Holdings LLC paid $1.06 million for the 10.080-sf building at 4985 Ironton St. in Denver. EC Holdings LLC was the seller.

The buyer is affiliated with Mary’s Medicinals, which is known for its transdermal patches that use beneficial components of cannabis for medical purposes, such as prevention of seizures. The company will more than quadruple its footprint with a move out of leased space, according to Taylor Hazard of Cushman & Wakefield of Colorado, who represented the buyer with Cushman & Wakefield’s Kirk Vanino.

“We had a lot of activity. It was only on the market for 10 days before we put it under contract,” said listing broker Heather Burns of BRC Real Estate, who represented the seller with BRC’s Michael Bright.

The industrial zoning allowed for a variety of uses, and the property generated interest from marijuana-related companies as well as other industrial users. “The industrial market is tight in general, but especially for people looking for a particular use. It’s difficult to find a building that’s going to work for them,” said Burns.

Although the property went under contract quickly, the buyer was strategic in its search.

“From when we first started looking to closing was almost a year,” said Hazard. “They are very well-informed. The investment had to pencil out from a valuation standpoint.” The building sits on a 1.04- acre site that is fenced and secured. The property also includes a separate, cold-storage structure.

“A building with extra land is probably the hardest commodity (to find) right now,” said Hazard.

The zoning allows for cannabis grow operations, although Mary’s Medicinals doesn’t plan a grow facility at present, he said.

DirecTV signed a 10-year lease for 21,972 sf of industrial space at 13330 E. James Casey Ave. in Concord Business Center in Englewood. The building will house an operations service center.

Peter Beugg and Tyler Reed of JLL represented the tenant.

Jason Addlesperger and David Lee of Newmark Grubb Knight Frank represented the landlord, IBC Holdings.