Colorado Real Estate Journal - July 15, 2015
Seattle-based Unico Properties LLC added to its downtown Denver holdings with the $30 million acquisition of the Denver Club Building at 518 17th St. Unico bought the 24-story building from Lowe Enterprises and will invest $10 million in common-area improvements and tenant spaces. The deal included all but the 16th through 19th floors of the 1954 building, one of the premier buildings of its time. The Denver Club, which has been at the same site since 1888, owns and occupies two of the floors, and Black Creek Group owns another. The 231,454-square-foot building’s occupancy was 82 percent at the time of the sale. DCT is a large tenant in the building, which also houses oil and gas, financial services, health care and business services tenants. Charles Schwab and the Corporate Deli are located on the first floor, which also has a chapel that was built for former First Lady Mamie Eisenhower to use during frequent visits to the nearby Brown Palace. The building also retains original flooring. “With the acquisition of this architectural gem in downtown Denver, our goal is to invest a significant amount of capital to upgrade the building’s image while still maintaining its historic character, all while continuing our growth and expansion in the Denver market,” said Ned Carner, Unico Properties vice president of acquisitions. “We’re thrilled to own and invest in the Denver Club and in Denver’s CBD. With this acquisition, we plan to elevate the building’s profile for new and existing tenants and further enhance the financial district’s reputation as a premier destination to work.” Carner said the location is appealing to oil and gas companies that want to be in proximity to other energy firms. It also appeals to tenants that don’t want to be in Lower Downtown “or tenants that seek high-quality, efficient office space but who are not willing to pay the rents associated with new construction in LoDo.” Unico Properties will build out suites for tenants looking for move-in-ready space, as it typically does with its assets. “We had a great deal of interest with the property – everyone from condo converters to multifamily-type opportunities to traditional office ownership groups,” said Riki Hashimoto of Newmark Grubb Knight Frank, who represented the seller with Dan Grooters of NGKF. One of the first skyscrapers built in downtown Denver, “It’s one of the iconic buildings in downtown Denver’s history. It’s going to be interesting and certainly noteworthy to watch what Unico does with this building,” Hashimoto said. The Denver Club originally had a mansion on the property that was demolished to make way for the new building in 1954. “The financial heart of downtown Denver offers an ideal opportunity to grow and expand our portfolio,” said Austin Kane, vice president and regional director of Unico Properties’ Denver portfolio. “We continue to seek office acquisitions, as we did with the Denver Club and with 1660 Lincoln a couple of years ago, to continue to increase our presence in the Denver market and to reposition and raise the profile of some key assets.” With the acquisition, Unico Properties owns more than 2 million sf of office properties in Denver, including Writer Square, 17th and Larimer in LoDo, the Root and Zang buildings in the Central Platte Valley, and others. It also has 1.4 million sf in Boulder.