The 36-story 1670 Broadway office tower is on the market. The tower is being listed by the CBRE team of Mike Winn, Tim Richey, Chad Flynn, and Jenny Knowlton.
The office building is a true trophy tower.
Indeed, a 4:14 minute video of 1670 Broadway describes it is as a “coveted Class A trophy tower” and a “rare opportunity” to buy an ‘’irreplaceable tower.”
The slick video also says that a new lobby entrance under construction will transform the building into the “most millennial-friendly” office building in Denver’s financial district.
That may not be hyperbole.
“I’m very bullish,” about the tower, said Doug Ressler, director of business intelligence for Yardi Matrix, a commercial real estate data research firm.
He expects that 1670 Broadway will be especially attractive to California-based institutional investors.
“I expect that California-based, and other West Coast investors, are going to be circling the wagons,” Ressler said.
“There is a tremendous amount of institutional capital available for these kinds of large, trophy buildings in dynamic cities like Denver,” he said.
The tower is anchored by TIAA, which takes 51 percent of the 697,555-square-foot building. The vacancy rate is the tower is just under 10 percent, while the overall office vacancy rate for the central business district is 13.6 percent, according to Yardi-Matrix. The building is LEED Gold certified.
If 1670 Broadway sells for $450 per sf, close to the average price of an office building sale in downtown, its sale price would top $315 million, with a new addition, which will bring the total square footage to more than 700,000 sf.
The building would be the second largest sold by size in downtown in the past five years, shows a detailed analysis of 65 building sales in a 3-mile radius that Ressler was kind enough put together for me.
The only larger building to sell, in terms of square footage, during that time period was the 970,755-sf Denver City Center, which sold in December 2013 as part of a portfolio sale, according to Ressler’s research.
When it opened in circa 1979-1980, 1670 Broadway was apparently the second-tallest building in downtown, topped only by the 40-story 555 17th Street, which opened in 1978.
Today, 1670 Broadway is the 11th tallest tower and will be No. 12 if New York based-Greenwich Realty Capital builds its 1,000-foot, 81-story tower at 650 17th St. Greenwich has submitted preliminary plans for the skyscraper to Denver. If built, it would tower over the tallest building in Denver, the 56-story Republic Plaza.
In terms of square feet, 1670 Broadway easily is one of the 10 largest in downtown.
Of those that are larger, only 555 17th St. opened before 1670 Broadway.
It was one of the first office buildings built during the energy boom that would transform downtown Denver’s skyline with a flurry of new buildings, including Republic Plaza and the Tabor Center.
Indeed, 1670 Broadway’s initial name was Amoco Tower, to reflect its anchor tenant. Amoco originally was Standard Oil Co. In 1998, Amoco was purchased by British Petroleum, now known as BP.
Amazingly, it also appears the CBRE listing marks the first time for a market-rate sale of 1670 Broadway.
In 2003, Aetna Life Insurance Co. turned the building over to what was then a subsidiary, UBS Realty Investors, the current owner of the tower.
There was no sale price listed and it apparently was an “in-house deal,” possibly as part of a foreclosure, shows record mining by ace researcher John V. Winslow, who publishes the Winslow Report for the Colorado Real Estate Journal.
“During the crash of 1985-1986, developers were experiencing difficult times,” Winslow noted.
Here is a rundown of the history of 1670 Broadway, according to Winslow’s research.
Continental Cities Co., now known as Lambert Development of New York City, purchased the 40,020-sf site at Broadway and 17th Street for $4.5 million ($18.1 million in today’s dollars) in 1977.
Henry A. Lambert, president of Continental and later his namesake company, borrowed $43.3 million ($159.95 million, adjusted for inflation) from Continental Illinois National Bank and Trust in 1978. Travelers Insurance Co. executed a permanent loan in the same amount in 1978 for the tower, show records uncovered by Winslow.
In 1980, a $13.3 million loan on the property from Travelers was assigned to Aetna.
“The current ownership has done an outstanding job in maintaining the building, which most likely has an effective age of 15 years or less, even though it is nearly 40 years old,” thanks to its extensive, energy-efficient renovation, Winslow said. It will have 704,566 sf of space when the podium lobby building is completed.
“Personally, I feel it was unfortunate that Mr. Lambert did not reap the rewards of this building as it is one of the nicest skyscrapers in Denver,” Winslow said.
“The quality of construction and well-designed architectural coupled with the location at the entrance to the CBD of Denver lends itself to being a top office building in Denver.”