Continental Realty Advisors Ltd. made its return to the metro Denver marketplace with the purchase of Canyon Reserve at the Ranch.
CRA, a Denver-based national multifamily investment and management firm, in partnership with GTIS Partners, a global real estate investment firm headquartered in New York, purchased the 256-unit property at 2890 W. 116th Place in Westminster.
The community was sold for $48.9 million by LivCor LLC/The Blackstone Group, according to public records.
Constructed in 1984, Canyon Reserve recently was upgraded with new roofs and skylights, however, it offers the opportunity for a full renovation to the community, which has a current occupancy above 96 percent.
“Canyon Reserve at the Ranch is a perfect example of CRA’s strategy to invest in and improve communities with strong underlying economics while maintaining a commitment to provide affordable rents and quality service to our residents,” said Robert Ireland, director of acquisitions for CRA.
“We will continue to expand our Denver portfolio through strategic acquisitions in demand-driven submarkets within the greater MSA,” added Ireland. “Canyon Reserve is a good representation of what CRA is looking for going forward, although we do not have constraints on age, ceiling height, etc., as many others do. We take a top-down approach when analyzing potential investments beginning with the market as a whole and then drive down into submarkets that provide a solid existing employment base, transportation support, retail support and limited new supply relative to other comparable submarkets in the MSA.
“We tend to be attracted to assets within our defined areas that have a ‘value’ component, meaning that the rents are affordable when compared to competitive properties and are at levels that are affordable for low- to middle-income households,” he continued. “Our strategy has been to improve the quality of life for our tenants by investing capital into both the common area amenities and unit interiors while still providing value-level rents to current and prospective tenants. Given the significant increases in land and construction costs in the Denver metro over the last five years, newly constructed multifamily product demands rents that are simply out of reach for the majority of our population. We firmly believe that ‘affordable’ housing is severely undersupplied not only in Denver but in the U.S. and intend to acquire multiple assets in Denver over the coming years that share the same attributes as Canyon Reserve.”
Upgrades planned at Canyon Reserve include enhanced landscaping, new exterior paint, expansion and improvement of the pool surrounds, addition of fitness on demand, construction of a coffee lounge and patio, and expansion of the existing leasing center.
Apartments are expected to receive updated cabinetry, stainless steel appliances, plank flooring, modern lighting, hardware and paint.
The property includes 16 two-story buildings with two clubhouses, a spacious dog park and business center. All of the apartments at Canyon Reserve feature wood-burning fireplaces, vaulted ceilings, deep-bath garden tubs and private patios or balconies.
Additionally, the community is near major firms such as Ball Corp., Staples, Vail Resorts, Google, IBM and Oracle as well as less than 4 miles from the Westminster Mall redevelopment.
Holliday Fenoglio Fowler’s Jordan Robbins, Jeff Haag and Anna Stevens brokered the sale. The HFF debt placement team representing the borrower included Josh Simon, managing director, and Brian Carlton, senior managing director.
Robbins, who declined to comment directly on the sale, noted that Westminster is a highly sought-after submarket, especially for value-add type of opportunities.
Canyon Reserve represents the first joint venture between GTIS Partners and CRA.
“We are very pleased to partner with the talented CRA team on Canyon Reserve, which is in one of our strongest markets,” said David Pahl, managing director, GTIS Partners. “We can create significant value by repositioning the property in response to growing local demand. This is the first of many planned investments for a newly formed GTIS fund and represents a promising start to executing our fund strategy.”
CRA’s portfolio includes properties across Kentucky, Texas, Tennessee, Arizona and Nevada. It looks to grow its Colorado holdings not only in Denver but also across the state.
“Our strategy moving forward is to invest in assets all across the Front Range, from Colorado Springs up to Fort Collins. Although Colorado Springs and Fort Collins currently stand on their own when considering employment diversification and infrastructure, we feel that they both benefit from the growth that has been realized in the Denver MSA. As the path of growth in Denver continues to slowly move north and south along I-25, these markets will begin to be less recognizable as independent entities. Given our corporate office location in Denver and our acquisition of Canyon Reserve, it makes sense that we would achieve greater efficiencies by acquiring multiple assets across the Front Range,” added Ireland.