Colorado Real Estate Journal - February 18, 2015

Activity drives up sales price for central Denver building

An owner got more than it

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An owner got more than it bargained for in the sale of a single-tenant industrial building in central Denver.

The 58,654-square-foot building at 5901 Broadway sold for $4.58 million, or $78 per sf, which was higher than the asking price of $4.38 million.

“The property received trem e n d o u s interest,” said CBRE Senior Vice President Tyler Carner, who represented the seller in a deal that drew 10 offers. HVAC Supply, a leading wholesale distributor of heating and air conditioning units, has been in the building for more than a decade and continues to occupy it on a long-term lease.

Rosenben HS LLC, a 1031 exchange buyer from California, purchased the property from Dual Enterprises, a group affiliated with the tenant.

Carner, who co-listed the property with CBRE Vice President Jeremy Ballenger, said prospective buyers were attracted to the asset by its functionality and central location. The building offers 24-foot-clear ceiling height, along with 11 south-facing loading doors and a drivein door.

“The strong fundamentals of the central market coupled with the long-term nature of the lease made it a very attractive asset to investors,” Carner said.

HVAC Supply has operated in Denver since 1986.

Other News

TOD Properties purchased a redevelopment site six blocks from Coors Field in downtown Denver’s Ballpark neighborhood from A.R. Wilfley & Sons. The property at 2840 Blake St. is comprised of an approximately 13,000-square-foot industrial building on a half-city block, or 50,000 sf of land.

Ron Webert and John Bitzer of Lee & Associates represented A.R. Wilfley, which is moving its manufacturing operations from the site it has occupied for almost 90 years.

“With all the development occurring downtown, the interest level for the site was very high. TOD Properties made an early offer and was very persistent in getting the property under contract,” said Webert.

“As far as land/redevelopment deals go, this one went very smooth. TOD was a pleasure to work with throughout the entire process.” TOD Properties is a local development and investment firm specializing in properties located in close proximity to light-rail stations and transportation nodes. “I am very bullish on the River North and Ballpark areas due to their proximity to LoDo and the 38th and Blake station on the East line. I am always looking for properties in high-quality locations, so when this property became available, I jumped at the chance,” said Scott Watkins, principal of TOD Properties. “I expect the area to continue to be very dynamic in the years ahead. Lee & Associates and the folks at A.R. Wilfley & Sons were great to work with and made the quick closing that much easier.” The sales price wasn’t released, but public records show it was $3.52 million.

A 28,598-sf industrial building on 1.2 acres along Interstate 70 just east of the Colorado Boulevard exit sold for $1.93 million, or $67 per sf.

The building at 4611 E. 46th Ave. in Denver has been home to Castlegate Garage Door Service Inc. for the past 10 years.

Mark and Carole Burns sold the property to DDMC LLC, a local investment company. The buyer has a tenant in the marijuana industry that will occupy the space.

“The property was on the market two years ago and a deal was almost struck to sell to a local manufacturing company. The Burns(es) decided to pull it off the market and wait to see what effect the marijuana industry would have on values. Their patience certainly paid off with almost a 40 percent increase in value in the short time period,” said Ron Webert of Lee & Associates, who represented the sellers in the transaction.

“With an IB zoning and freeway visibility, this property was on the radar screen of many operators in the industry. Like most industrial deals in today’s market, we had a few starts and stops before getting to the closing table with DDMC,” he continued.

“The property didn’t have heavy power or a sprinkler system, and it had some deferred maintenance, all of which knocked the price per foot down a little. The new owners will be putting in some significant capital improvements to the building immediately,” Webert said.

Bellino Electric Services leased 11,092 sf of warehouse space at 17130-17140 and 1700- 17110 E. Ohio Drive in Aurora.

Tim Shay of Colliers International represented the landlord.

Eric Gold of API Sheldon-Gold Realty Inc. represented the tenant.