It was an opportunity too good to pass up.
Seattle-based Unico Properties LLC made its entry into the Colorado Springs market with its acquisition of Colorado Square, a 14-story office tower in the heart of downtown.
Unico Properties paid $34.6 million, according to public records, for the 257,253-square foot Class A office tower at 2 N. Nevada Ave.
“We saw an immense opportunity in this property,” Ned Carner, Unico Properties senior vice president, acquisitions and development, said of the acquisition.
“We’re excited to be in a position to contribute to the vibrancy of Colorado Springs’ downtown,” he added. “We plan to further enhance and refresh the building by investing in capital upgrades and introducing the kinds of amenities and management that we believe are essential to an inspired, tenant-centered office experience.”
Unico Properties’ initial plans for building improvements at Colorado Square include updates to the common areas and tenant spaces, with an emphasis on developing “top-shelf” amenities.
DPC Development Co. sold the 1976 asset – a property that was difficult for the Colorado based owner and developer to sell.
“It was a real hard decision for us to sell it. We really liked the asset,” said DPC Development President Chris King.
DPC Development Co. purchased the property in 2007 and made updates to both the building and its rent roll.
Kinder Morgan, which owns and operates Colorado Interstate Gas, is the building’s largest tenant and has been in the building since its construction. It occupied the entire building with three years remaining on its lease when DPC acquired it, however, DPC worked with Kinder Morgan to downsize and renew its lease – taking back around 100,000 sf.
DPC proceeded to modernize the building systems, redo the first-level exterior on three sides of the building, renovate the common areas and the spaces it took back as well as reconfigure the first floor’s retail space to a more modern retail space and institute its spec suite program, building out suites throughout the building to add to the multitenant nature of the property.
There was good activity on the asset, which was marketed as a property with long-term stability with a credit, Class A tenant occupying around two-thirds of the building and upside in rents in the multitenant spaces, most of which have been built out with modern finishes, added King.
“We had done all the heavy lifting and we were enjoying being rewarded for that work. We just decided to lighten our Colorado Springs portfolio,” King said of the decision to sell Colorado Square. It was represented in the sale by Mike Winn and Tim Richey of CBRE. Earlier this year, DPC sold the Erindale Shopping Center in Colorado Springs.
Additionally, DPC had a previous transaction with Unico in downtown Denver, selling the 15-story 1875 Lawrence office property.
“They are a great buyer. They’re a really good operator and their profile fits exactly what we were offering,” King said of Unico.
Colorado Square was around 80 percent occupied at the time of sale. The retail space is occupied by Colorado Business Bank, Dickey’s Barbecue Pit and DocuMart, a business service printing, copying and mailing firm. The office tower features a 360-degree view of the city and the surrounding Rocky Mountains, and is within two blocks of the market’s best retail and restaurants.
In addition to Colorado Square, Unico Properties owns 2.4 million sf of space in Denver and 1.4 million sf in Boulder. Unico Properties is a real estate investor and full-service operator focused on office and multifamily assets in the western United States.