Colorado Real Estate Journal - April 6, 2016
Jackson Square Properties, a privately held investment company based in San Francisco, recently sold one multifamily community in the Denver area and bought another. “They sold a value-add property and traded up to a newer one,” said Terrance Hunt, who was part of the ARA Newmark team that handled both transactions. Jackson Square owns almost 3,000 apartment units in the Denver area. The sale prices for the two deals sold by the ARA Newmark team, which also included Shane Ozment, Jeff Hawks and Doug Andrews, weren’t released. However, records show, in total, the two deals totaled $75.1 million. Public records indicate that Advenir paid $39.6 million to Jackson Square for the 345-unit Villas at Parker. Advenir, based in the Miami area, has renamed the community Advenir at Cherry Creek North. The community at 1090 S. Parker Road in Denver was built in 1972 on a 17.4-acre site. Jackson Square had paid $34.6 million for the community in December 2014, according to records. In other words, it sold it for a $5 million profit after holding it for less than two years. ARA Newmark received eight offers for the community, Hunt said. “Advenir liked it because of what is going on from Glendale along Leetsdale (Drive) to Cherry Creek,” Hunt said. “It’s also close to Fitzsimmons and Lowry and you are seeing some good migration of residents to that entire Glendale area,” he said. There also is a lot of new retail, such as a new Natural Grocers, he said. He also pointed out that the nearby Jewish Community Center is doing a $50 million addition. Rents in the community have grown 12.3 percent, year-over-year, ARA Newmark’s research showed. The property had undergone extensive renovations in 2008 and 2009. “With high demand for units in the area with quality finishes, the buyer plans to take a ’70s product at a lower price per unit and further invest to attract residents while staying well below replacement cost or the cost to acquire newer product,” said Hawks. Advenir likely will invest another $5,000 to $6,000 a unit over the next few years, Hunt said. In the other deal, records show Jackson Square paid $36.1 million, or $195,135 per door, for the 184-unit Arapahoe Club apartments at 2800 S. Syracuse Way in Arapahoe County. Arapahoe Square was built in 1994. Jackson Square bought the property from another San Francisco-based firm, the Reliant Group. Records show that Reliant paid $18.85 million, or $102,446 per unit, in September 2012. That is about a 91 percent increase from the amount Reliant paid for the property less than four years ago. Like the community that Advenir purchased, Arapahoe Club is in the Cherry Creek School District and near Glendale, Lowry, Buckley and the Anschutz Medical Campus at Fitzsimons. Reliant had “invested significant capital in the infrastructure, common areas and only a few unit renovations, but had achieved a 46 percent return on the upgraded units,” Ozment said. “Jackson Square plans to continue with this proven value-add strategy,” Ozment added. The Class B property is also near the Denver Tech Center and is minutes from the Yale Station on the Southeast light-rail line.