Colorado Real Estate Journal -
Griffis Residential recently paid $80.25 million for the Crestwood Apartments in Thornton. It was the biggest single purchase by the Denver-based company, said David Birnbaum, co-founder and managing director of Griffis Residential. In terms of the number of units, the 562-unit community represents the largest sale this year in the metro area, said David Potarf, who listed and sold the community with fellow CBRE team members Dan Woodward and Matt Barnett. As far as the dollar amount, Potarf said he believes it is the second-largest deal this year, only topped by the Commons Park West sale of $98.1 million. It is, however, apparently the most paid for a suburban apartment community this year. “I think with this purchase we are now the second-largest owner of Class A multifamily properties in the Denver area,” Birnbaum said. With Crestwood, Griffis Residential now has more than 3,800 units in its local portfolio, he said. “I think only Equity Residential is bigger,” he said. As Equity Residential is based in Chicago, Griffis Residential would be the largest Denver-based owner of Class A properties. Crestwood is the type of high-quality, well-located asset that Griffis Residential wants to own. “Crestwood is right down the fairway of what we do,” Birnbaum said. “We own core-plus properties,” he said. “We like properties built in the late 1990s to the early 2000s. We add value through our management.” Crestwood was completed in 2002. Griffis Residential, through its Griffis Premium Apartment Fund, purchased Crestwood from the Bascom Group. The Bascom Group paid $60.8 million for Crestwood in 2008, according to public records. That equates to $108,185 per unit or $117.46 per square foot. Griffis Residential paid $142,794 per unit or $155.03 per sf. “The previous owner did a good job and Crestwood was in very good shape,” Birnbaum said. “We will do some additional improvements and over the next three years we will take some selected units and upgrade them” for tenants who are willing to pay a higher price for units with premium finishes. Birnbaum likes the niche Crestwood serves, both geographically and in terms of the unit size. “About 12 percent of the units are three-bedrooms, which is pretty high” and makes Crestwood attractive to families, he said. “There also is a very good elementary school in the area,” he said. “I think attracting families is one of the areas we are going to build on.” “Also, they are big units,” with an average size of 920 square feet, Birnbaum said. “Crestwood is also relatively close to downtown Denver, but it is much more affordable than living downtown,” he said. Not that most of the tenants will be working downtown. These days, many of the residents increasingly may have ties to the oil and gas operations in Northern and Northeast Colorado. “I’m not sure I could say that a lot of people are driving to the oil and gas operations every day, but I think a lot (are driving to) offices in the areas for the companies that have operations in the growing energy business,” he said. He said when you drive around the parking lot at Crestwood, there are a lot of pickup trucks with the names of oil and gas companies on the side. Potarf said he wouldn’t be surprised if a lot of the residents at Crestwood were making the commute to oil fields in Northern Colorado. “When you start going north all the way up to Greeley area, there is no housing,” Potarf said. “I think a lot of people working in the oil fields are renting in that Northglenn-Thornton area,” he said. Potarf said there were a lot of buyers interested in Crestwood. “It was performing well during the marketing period and during the due diligence period,” Potarf said. “We received more than 10 offers for it.” Potarf said Crestwood will only become more appealing in the coming years. That is because it will be a transit-oriented site because of its proximity to a future FasTracks light-rail station. “It is only a block away from the East 124th Avenue light-rail station,” Potarf said. That line is scheduled to open in 2016, providing rail access to downtown Denver, as well as Denver International Airport.