The company that developed the Peloton in Boulder has the prized 432-acre property in Louisville under contract that is owned by energy giant Phillips 66, the Colorado Real Estate Journal has learned.
Bancroft Capital, based in Manhattan Beach, California, appears to have agreed to pay $50 million for the land off U.S. 36, which is seen as being in the running for the second headquarters for Amazon. Bancroft founder Doug McDonald, on Monday afternoon confirmed that his company plans to buy the property.
“You are correct; we put it under contract in June,” McDonald said.
Conoco, then ConocoPhillips, bought the property in 2008 for $58.5 million, with plans to turn the former Storage Technology/SunMicrosystems campus into a world-class research and training campus focusing on sustainable energy.
Conoco spun off Phillips 66 into a separate company in 2012 and the Houston-based company listed it for sale soon after the split.
McDonald said he has been looking at the property even before Conoco owned it.
“Our first tour of the property was probably 15 years ago,” McDonald said. “I think our bid was second to Conoco’s.”
He said he loves the property because of its location, it is along a transit corridor (U.S.36), and its proximity to the University of Colorado in Boulder.
The big question, of course, is whether it would be the site for Amazon’s second headquarters.
“It’s interesting that you ask that,” McDonald said. “We signed our contract in June and that pre-dates the Amazon announcement. But our interest in the property pre-dates Amazon by years.”
That said, he believes it would make an ideal site for the Amazon headquarters.
“The property meets every single criteria for the Amazon headquarters,” McDonald said. He also said that they have received the material from the Metro Denver Economic Development Corp. to submit the site to Amazon.
“Looking at this property for 15 years, we are very passionate about it,” McDonald said. Bancroft has hired the Denver office of the architectural firm of Gensler to make sure the “natural beauty” of the site is preserved, he noted.
The one thing he did not want to discuss was the $50 million price tag.
“I will neither confirm nor deny that,” McDonald said.
Phillips 66, in its latest 10-Q Securities and Exchange Commission filing, had this to say: “In June 2017, we entered into an agreement to sell land located in Louisville, Colorado, to a land development company … We classified the property as held for sale and transferred $50 million of PP&E to the “Prepaid expenses and other current assets” line on our consolidated balance sheet. We expect to close the sale in the first quarter of 2018 following a contractual inspection period. The net sales proceeds are expected to approximate the carrying value of the land.”
McDonald said he has not seen the filing and could not comment on it.
PP&E is an acronym for properties, plants and equipment. A prepaid expense is a type of asset that arises on a balance sheet as a result of business making payments for goods and services to be received in the near future.
At $50 million, Bancroft would be paying about $2.65 per foot for the land.
He noted a recent nearby sale was north of $2.50 per sf.
Still, it could take 30 years to build out the site, “unless some entity such as Amazon buys the entire property for its campus,” according to Winslow. B
The site is being listed by Martin Roth, Eric Roth and Frank Kelley of CBRE. Because of confidentiality agreements with Phillips 66, they are not allowed to discuss the property and referred all questions to Phillips 66.
When asked about the pending sale, a spokeswoman for Phillips 66, an oil and gas refining and marketing company with a market cap of about $45 billion, responded by email, saying: “Phillips 66 can confirm that we have been actively marketing the property, but we do not have any other information to share at this time.”
Phillips 66 paid Conoco $38.1 million as part of the split of assets, records indicate.
Conoco received planned unit development that allowed 2.4 million sf of commercial space. The original Conoco plan has not been updated and does not include residential uses.
Amazon wants residential to be part of its new headquarters outside of Seattle. Amazon’s $5 billion second headquarters oustside of Seattle would eventually employ 50,000 people.
Bancroft is no stranger to the area. Bancroft is the developer of Peloton, a 385-unit, $150 million dollar mixed-use condominium community on 10 acres in Boulder. Although technically based in California, 100 percent of the assets owned by Bancroft are in Colorado and it has far more staff in the Denver area than anywhere else, McDonald said.
Bancroft’s other area holdings include:
- 3333 Walnut Street, a 65,000-sf Class A office building that was originally designed as Amgen’s regional headquarters and now is anchored by McGraw-Hill;
- The five-building, 129,4250-sf Ball Aerospace Campus, which it purchased for $16 million;
- The 155,821 sf, six-building office campus on 38th Street in Boulder that was formerly the headquarters for tape storage drive manufacturer Exabyte. The campus is now home to four headquarters: The National Ecological Observatory Network, the National Institute for Trial Advocacy, E Source and BiOptix.
- Denver Highlands, a 365,000-sf office campus with a nine-story tower and five-story office building in southeast Denver.
Bancroft doesn’t know yet whether it wants to rezone the land, according to Aaron DeJong, economic development director for Louisville.
“It’s pretty fresh for them,” DeJong said. “They’re trying to figure it out.”
McDonald said that a residential component is not a criterium of Amazon’s RFP.
“But if Amazon wants residential, I am sure the City of Louisville would be willing to accommodate them,” McDonald said.
Asked if he thought the site could be a candidate for Amazon’s second headquarters, DeJon replied: “It certainly could. Obviously, Amazon is a Denver area type of opportunity first, and then you look at one site. But it’s nice to dream about Amazon coming to Louisville.”
This site would be more than 10 times the size of a 40-acre property that is part of the Gates Rubber development site near Interstate 25 and Broadway, and Fox North, the 41-acre former Denver Post printing press site near the Mousetrap at I-25 and Interstate 70, both of which have been considered potential sites for Amazon.
Stew Mosko was one of the brokers who initially sold the land to Conoco.
“I think that the large, sprawling suburban office campuses are being replaced by the urban campuses with taller buildings,” said Mosko, now a broker with Cushman & Wakefiled.
“On the other hand, that old StorageTek site is a beautiful piece of property,” Mosko told me last week.
“When I used to show the site, I could make it there from my office in downtown Denver in 15 minutes, as long as it wasn’t during rush hour. And it is right at (U.S.) 36 and the Northwest Parkway, which is really E-470, so you can make it to DIA in about 30 minutes with no stoplights. And Boulder is maybe 10 minutes away.”
Amazon said it wants its new headquarters to be in a metropolitan area of more than a million people, near a strong university system and within 45 minutes of an international airport.
It also would like a transit-oriented development site. Light rail doesn’t go to the Louisville site, but U.S. 36 is served by a bus rapid transit system.
The New York Times recently said that Denver would be the best choice for Amazon’s second headquarters.
“So Denver it is,” according to the New York Times. “The city’s lifestyle and affordability (compared to housing prices in Seattle), coupled with the supply of tech talent from nearby universities, has already helped build a thriving start-up scene in Denver and Boulder, 40 minutes away. Big tech companies, including Google, Twitter, Oracle and IBM, have offices in the two cities. Denver has been attracting college graduates at an even faster rate than the largest cities. The region has the benefits of places like San Francisco and Seattle — outdoor recreation, microbreweries, diversity and a culture of inclusion (specifically cited by Amazon) — but the cost of living is still low enough to make it affordable, and lots of big-city refugees have been moving there for this reason. Amazon would be smart to follow them.”