Wheeler Block Building photo courtesy Cushman & Wakefield

Cushman & Wakefield announced the sale of the Wheeler Block Building, a 32,855 square foot office building located at 2150 West 29th Avenue in the Lower Highlands neighborhood of Denver. The 6-story property sold for $7,765,000. The Wheeler Block Building was originally constructed in 1892 and then substantially renovated in 2008.

Jon D. Hendrickson and Aaron D. Johnson, Senior Directors of the Capital Markets Group with Cushman & Wakefield, had the exclusive listing to sell the property on behalf of a Colorado-based private partnership.

“Wheeler Block is an incredibly unique office building located within one of Denver’s strongest urban neighborhoods,” said Hendrickson. “The property benefits from convenient interstate access, great surrounding restaurants and close proximity to everything downtown Denver has to offer. The buyer will be able to add value through leasing and strategic improvements. There will always be a market for the Wheeler Block Building.”

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Image courtesy CBRE.

CoBank Center was completed earlier this fall and is the new headquarters for CoBank, a cooperative bank that provides financial services to agribusinesses and rural infrastructure industries in all 50 states.

Standing 11 stories, CoBank Center is a LEED Silver-Certified, Energy Star-rated building composed of 274,287 square feet across 4.22 acres. Building amenities include a full-service cafeteria, wellness center and 2,500-square-foot data center. The property is the second building in a three-building transit-oriented, mixed-use development called Village Center Station.

CoBank Center under construction in 2015.

“This building, as well as the first building within Village Center Station, which is also 100 percent occupied, reaffirms the value of creating cutting-edge environments for today’s workforce,” said Peter Culshaw, Executive Vice President of Shea Properties. Based in Greenwood Village, Shea Properties has developed over 5 million square feet of office space in Denver, but regards the CoBank Center as a jewel of an office building.

Jeff Shell, Executive Vice President with CBRE Corporate Capital Markets in Grosse Pointe, Michigan, and Geoff Baukol, Senior Vice President with CBRE Capital Markets, Investment Properties, in Denver, represented Shea Properties as the seller.

“CoBank Center stands out as one of the premier Class A headquarters development projects in the nation,” said Shell. “The state-of-the-art building combines sustainable design with the latest technologies while enjoying panoramic mountain views in a location with walkable access to dining, entertainment and light-rail transit. The core attributes of the building combined with CoBank’s tenancy and the area’s strong fundamentals helped to capture the interest of the Korean investor. “

CoBank Center was designed by Denver-based Davis Partnership Architects.

“Village Center Station is the nucleus of the southeast Denver office scene with 1.5 million square feet of Class A office space, the highest concentration in the submarket,” said Baukol. “CoBank Center is the newest and highest-quality asset in suburban Denver and saw incredible buyer demand.”

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The Denver Metro Association of Realtors has released its monthly real estate report which highlights data from the month of November.

According to the report, a 21 percent decrease in home inventory from October to November in metro Denver was observed. At the end of November a total of 5,683 homes were on the market. This figure equates to a 5 percent increase in available homes compared to November 2014.

“Don’t be alarmed by the substantial decreases in market metrics last month including active listings, new listings, number of homes sold and overall sales volume,” said Anthony Rael, Chairman of the Denver Metro Association of Realtors Market Trends Committee. “While it’s good to be aware of how the market is shifting from month-to-month, it’s equally important to pay attention to the 12-month trends. With the job market’s recovery, we can expect to see a healthy real estate market continuing into 2016.”

A 34 percent decrease of new listings was observed in the condo market, but is up 25 percent when compared to November 2014. 

During November 61 homes in metro Denver closed for a price over $1 million, a figure down 32 percent compared to October and down 3 percent compared to 2014.

“The number of luxury single family homes priced over $1 million may be down, but the average price is up,” said Nicole Rufener, member of the DMAR Market Trends Committee. “There is almost sixteen months of inventory in this price point which strongly favors the luxury buyer. If you have a luxury listing that is not moving, especially outside of Denver, it is time to look at price reductions to get it sold.”

The most expensive home sold in November was a $6.3 million property located in Eldorado Springs. The home features four bedroom, six bathrooms and 5,588 above ground square feet. Eldorado Springs is located just south of Boulder.

November’s priciest condo sold for $1.555 million and is located in Denver’s Cherry Creek North neighborhood. This property includes four bedrooms, four bathrooms and 3,434 square feet of above ground space.

“The price and days on the market cooled off from last month but are stronger than last year,” states Rufener. “There is about four and a half months of inventory, which favors the luxury condo sellers.”

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Hunt explained, “This transaction is a continuation of the strong interest and momentum in the metro Denver market. The ability to secure permanent debt at historically low rates is leading to an increased appetite for stabilized, renovated assets.”

The property underwent a renovation in 2012: the kitchens were updated with stainless steel appliances, the bathrooms were updated, new flooring was installed, and new lighting is featured.

Bratley stated, “The buyer was able to secure this property due to the seller-friendly terms, which included a very large amount of non-refundable earnest money and a contract extension to help facilitate a seller 1031 Exchange if needed. We had higher offers, but favorable terms won the deal.”

Chill is located three blocks to the west of the construction site of the Country Club Towers– a residential project that will house 558 apartment units in two 31-story towers. The Country Club Towers project is being developed by the Broe Group just southwest of the intersection of Speer Boulevard and Downing Street.

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© 2015 Denver Urban Review

CBRE has released its quarter 3 reports which provide information on Denver’s commercial, industrial, and retail real estate markets.

In downtown Denver the commercial vacancy rate is 13.3 percent and the average lease rate is $34.44 per square foot per year. Currently, 1,366,261 square feet of commercial space is under construction in downtown Denver, which leads all Denver metro area submarkets.

Rendering of 1144 Fifteenth Street. Image courtesy Hines.

The largest office project currently under construction is 1144 Fifteenth Street which is being developed by Hines. This 40-story skyscraper will add 662,900 square feet of office space to the downtown Denver making it the largest commercial project to rise downtown since the mid 1980s. Construction of 1144 Fifteenth Street is slated to be completed in approximately 27 months.

Also under construction is the 22-story 1401 Lawrence project. This 311,015 square foot office building is being developed by Canadian developer First Gulf, the commercial division of Great Gulf Corporation. National law firm Polsinelli has signed a 15-year lease of 90,000 square feet to become the signature tenant of 1401 Lawrence. 

Denver’s office market observed a 2.2% quarter-over-quarter increase in its direct asking lease rate. Brand new properties, in high-demand areas close to transit and event venues hit the market in Q3.

Impacting leasing prices and vacancy rates in downtown Denver was the delivery of the 242,807 square-foot Triangle Building on 16th Street and Wewatta. Earlier this year it was announced that cable company Liberty Global has signed to lease 70,000 square feet and WeWork, a firm that provides shared workspace and services for entrepreneurs has signed to lease 72,000 square feet at Triangle Building.

© 2015 Denver Urban Review

The 299,545 square-foot 1601 Wewatta project was also delivered in Q3. Hogan Lovells LLP signed a 15-year lease to occupy the top two and a half floors accounting for 70,000 square feet of office space at 1601 Wewatta and The Colorado Athletic club will utilize the entire second floor comprising of 38,000 square feet of space.

In suburban markets, a total of 1.1 million square feet of office space is currently under construction. The metro area has seen a positive year-to-date net absorption of 506,285 square feet in commercial real estate.

“Overall the Q3 commercial real estate market in Denver shows signs of solid, consistent strength. New construction in the office sector is driving record-level average asking lease rates for Denver,” explained Jessica Ostermick, Director, Research & Analysis at CBRE.

In the industrial sector, six buildings were delivered in Q3 in the Denver metro area which added 1.2 million square feet of space. Currently 2.3 million square feet of industrial space is under construction and 36.3 percent of under construction space is pre-leased.

The Airport/Montbello submarket saw the greatest amount of net absorption of industrial space at 219,964 square feet. It is also the metro area submarket with the greatest amount of industrial space under construction at 937,220 square feet.

The Q3 Denver metro industrial space vacancy rate is 4.6 percent.

“In terms of industrial, it continues to be a landlord’s market with demand still outpacing supply, and lease rates on the rise,” said Ostermick.

The Denver metro retail market hit a vacancy rate of 5.9 precent in Q3, which makes it the lowest vacancy rate since the recession. Central Denver currently has 130,360 square feet of retail space under construction with a Q3 vacancy rate at 7.9 percent.

King Soopers at 19th and Chestnut Place. © 2015 Denver Urban Review

Downtown Denver witnessed it’s first full-sized grocery store open with the delivery of the King Soopers at 19th and Chestnut Place.

The southeast submarket stands out with a 2.2 percent vacancy rate and 130,647 square feet of retail space under construction.

Retail construction activity increased 11.6% quarter-over-quarter in the Denver metro area.

“The retail sector is experiencing low vacancy combined with high levels of investment activity. While growth may slow, we expect to see strong fundamentals continue across the board in the coming quarters,” said Ostermick. 

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DUR 2015. Denver Skyline from Diamond Hill

The Denver Metro Association of Realtors has released its most recent real estate report which highlights data from the month of September.

according to the report the average length of days for a home on the market in the Denver area was 28 days with an average sale price of $356,005, which equates to a 2 percent dip in from August. When comparing September 2014 to September 2015, the year to year increase in average sale price is up 12 percent.

“The late, great Yogi Berra said it best, ‘You can observe a lot by watching,’” said Anthony Rael, Chairman of the Denver Metro Association of Realtors Market Trends Committee. “Without question, the same rings true for those who track market statistics. In order to truly understand the Denver real estate market, it’s essential to watch for signs in the month over month data, while observing year over year trends to appreciate the impact on home buyers and sellers.”

In September a decrease was also observed in the number homes sold at prices greater than $1 million. During September 83 homes in this luxury market sold; a number which is down 25 percent from August. However, comparing September 2014 to 2015 a 43 percent increase is seen for the number of hoes sold priced over $1 million.

“We saw a seasonal dip in the higher end market, but it is still stronger than last year at this time – and much stronger than five years ago,” said Jill Schafer, member of the Denver Metro Association of Realtors Market Trends Committee.

A home in Cherry Hills Village sold in September for $5,395,000. This was the most expensive home sold in the Denver area during that month. It included 7,990 square feet of above ground space and also features 8 bathrooms. The most expensive condo of the month sold for $1.800,000 and included 2 bedrooms, 3 bathrooms with a total of 2,621 above ground square feet. This condo is located in Cherry Creek North.

“We saw a seasonal drop of 27 percent from August to September,” Schafer stated. “But, so far this year, we saw a more than 38 percent increase in luxury homes sold compared to last year. Homes that are priced right, in good locations and show-ready condition are in demand. In fact, the list to sold price increased to 110 percent in September.”

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Working on behalf of RedPeak Properties, HFF placed the financing in five separate transactions with a national bank.  The seven-year, 3.91 percent, fixed-rate loans were structured as individual loans on each property totaling $28.8 million in aggregate.  Loan proceeds will be used to refinance existing debt and recover capital investments for the renovations of the properties. 

Property Location        Total Units    Avg. Unit Size    Year Built

929 Marion Street                43 Units          405 SF                   1955/2013

970 Pennsylvania Street     32 Units          635 SF                   1940/2015

1000 Grant Street                 86 Units         742 SF                   1963/2014

1075 Corona Street               36 Units         757 SF                   1955/2015

1145-1153 Ogden Street       23 Units         706 SF                  2012 & 1896/2012            

The HFF debt placement team representing the borrower was led by Josh Simon and Eric Tupler.

“HFF provided broad market coverage to ensure that we met our investment objectives.  The process was seamless and provided us with several attractive options to consider.  We look forward to working with HFF in the future as we continue to grow our portfolio,” said Bobby Hutchinson, Investment Director for RedPeak.

RedPeak Properties’ portfolio is comprised of 2,445 units located in Capitol Hill, Cherry Creek, City Park, Downtown Denver, Greenwood Village, Littleton, Hilltop and Washington Park. 

RedPeak will also add the 7|S Denver Haus apartment project that is under construction at the northwest corner of 7th Avenue and Sherman Street to its portfolio. This project will deliver 115 apartment residences, with 29 studios, 60 one bedroom apartments and 17 two bedroom apartments. Denver Haus is also located in Capitol Hill.

Photo of 1000 Grant courtesy of HFF.

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Townhomes under construction in RiNo summer 2015 DUR

The Denver Metro Association of Realtors has released its September real estate report which indicates an increase in the number of available homes for sale in the Denver metro area.

According to the report 7,587 homes were on the market at the end of August which is a 1.6 percent increase from July.

“Inventory levels will continue increasing slightly as over-priced properties begin competing with new appropriately priced listings, and prices will likely remain neutral,” stated Anthony Rael, Chairman of the Denver Metro Association of Realtors. “As our month-of-inventory inches up it moves us closer and closer toward a more balanced market.”

During the month of August 6,416 new listings hit the market, while 5,383 homes were placed under contract and 5,088 homes sold and closed in Denver metro area.

For properties listed at over $1 million, there was a 9.5 percent decrease in sales for this segment of the market when comparing July to August. Homes in this range were on the market an average of 92 days in August compared to 112 in July. Properties over $1 million are selling for an average of $5 more per square foot than they did a year ago and $13 more than 2 years ago.

“It seems like months of inventory are creeping back up in the luxury and signature markets,” explained Nicole Rufener, member of the Denver Metro Association of Relators Market Trends Committee. “Homebuyers had the most choices in the luxury price ranges in January 2015 with 16 months of inventory in single family homes and 24 months of inventory for condos.

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Mike Dailey

United Properties, a Denver-based developer and investment firm, has selected Mike Dailey as senior vice president of development. Dailey will focus on senior housing and retail development on behalf of the commercial real estate firm. He will work alongside Kevin Kelley, senior vice president of United Properties, to expand the company’s development activity in Denver, as well as potential surrounding markets.

“Mike is an outstanding hire for us and will help our company grow in the Denver area, a key initiative for us,” said Bill Katter, president-development and chief investment officer, United Properties. “He has a wealth of knowledge and experience and we look forward to Mike’s contributions.”

Prior to joining United Properties, Dailey was president of MVG Development. In addition, he worked for Opus Northwest as director of real estate development and in the real estate departments at Level 3 Communications and Safeway. Dailey received his law degree from the University of Denver College of Law and his bachelor’s degree in business administration from Menlo College in Atherton, California.

Dailey is licensed as a Colorado real estate broker and attorney, and is a member of the Colorado Bar Association. He is currently on the board of directors for Colorado Headwaters Land Trust and a previous commissioner for the Town of Superior Planning and Zoning. Dailey is a member of the International Council of Shopping Centers (ICSC) and NAIOP, the Commercial Real Estate Development Association.

In August United Properties announced that Beverage Distributors Company, LLC, Inc. has signed to lease 500,000 square feet of space and closed on the purchase of 45 acres of land from Forest City Stapleton. This land is located at I-70 and Havana Street in Denver.

The post United Properties names new VP appeared first on Denver Urban Review.

Colorado Trade Center. Image courtesy DTZ

Conscience Bay Company, a Boulder-based real estate firm announced that it has obtained the 700,000 square foot Colorado Trade Center. This property is located at 5151 Bannock Street in North Denver, which is northwest of the I-25 and I-70 interchange. The land was purchased from Bannock Street Limited Partnership. The property is fully leased between a handful of industrial tenants.

In 1922 the first building on the property was designed for use by the Chicago Burlington and Quincy Railroad. A railroad spur is currently located at the property.

Associated Grocers then acquired the land and built additional buildings on the site that were used for temperature controlled storage of fruit, vegetable and other food distribution.

Bannock Street Limited Partners purchased the site in 1985 and tenants have included Miller-Coors and Nestle Purina. This acquisition marks Conscience Bay’s first property in Denver and this single transaction more than doubles its portfolio.

Colorado Trade Center in 1930. Photo courtesy DTZ.

“There is a lot of exciting growth happening in Denver and much of this growth is moving in the direction of the Trade Center,” said Ben Woolf, Director of Investments at Conscience Bay Company. “Considering its phenomenal location and great highway access to both I-25 and I-70, we believe that the project offers opportunities for additional development and a wide range of commercial and industrial uses.”

Investment Sale Brokers R.C. Myles and Jim Brady along with Industrial Advisors Craig Myles and Tyler Smith of DTZ handled the sale transaction. DTZ will handle the leasing of the property on behalf of the new owner.

“This was an exciting sale to have been a part of,” said R.C. Myles, Managing Director of DTZ’s Capital Markets Group. “The Trade Center is one of those notable properties that most people in Denver know and recognize. The seller has been a long time friend and client of our firm and we are excited to have found a great buyer who has big plans for the future of the asset.”

This spring it was announced that DTZ and Cushman & Wakefield would merge and once the merger is completed, the company will operate as Cushman & Wakefield. This will create one of the largest real estate companies on the planet.

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