Value-add office portfolio fetches $49 million

The building at 400 Inverness was 84% occupied at the time of sale.

A San Francisco buyer collected six office buildings from Louisville to Englewood in a $49 million value-add portfolio deal.

While the name of the buyer wasn’t released, records show entities affiliated with global institutional asset management company Farallon Capital Management LLC bought the portfolio, which comprises 418,495 square feet. One of the buildings, 105 Technology Drive in Broomfield, is 100% leased, but overall occupancy was far less, presenting an opportunity to add value through lease-up.

“Across the board, the portfolio was hovering around 60% occupancy – some buildings were more leased than others. Generally, the play here was the opportunity to lease it up to stabilization,” commented Jenny Knowlton, vice president of CBRE’s Capital Markets Institutional Properties team in Denver.

SteelWave and Colony Capital sold the portfolio at a price of $117.09 per sf. The assets are:

  • 400 Inverness Parkway in Englewood, a 112,244-sf, four-story building built in 1997 that was 84% occupied at the time of the sale;
  • Highland Park at 9359 E. Nichols Ave. in Englewood, a single-story, 72,121-sf building also built in 1997, and vacant at the time of the sale;
  • 5350 S. Roslyn St. in Greenwood Village, four stories, 63,828 sf, built in 1982 and 70% occupied;
  • 141 Union Blvd., Lakewood, a 64,240-sf building built in 1985, four stories and 76% occupied;
  • 105 Technology Drive in Broomfield, 37,123 sf, single-story building built in 1997; and
  • Centennial Valley II at 285 Century Place in Louisville, a two-story building with 68,938 sf that was 31% occupied. It was built in 1997.

The buildings house numerous tenants, including technology companies SAIC, which occupies 105 Technology Drive in Interlocken Advanced Technology Environment; and F5 Networks, which has space in Centennial Valley II. The SM Stoller Corp., an environmental and technical consulting and engineering services company, is a tenant at 105 Technology Drive.

“We had a lot of interest in this portfolio,” said Knowlton.

“While it was spread out across the city, it was really good real estate and generally in areas that investors would look to target assets individually,” she said. “True value-add opportunities are so rare today, and especially to have it be good real state in a market like Denver.”

The listing team handling the sale, in addition to Knowlton, included CBRE’s Mike Winn, Tim Richey, Chad Flynn and Charley Will.

Jill Jamieson-Nichols has been an Editor with the Colorado Real Estate Journal for more than 15 years, providing coverage of office, industrial, hospitality and mixed-use development news in the Denver metro area, plus all property types in Northern Colorado, Boulder County and along the Highway 36 corridor. Prior to joining CREJ, Jill was Editor of…