Invesco Real Estate buys 1800 Larimer, a coup for Denver's commercial market. Dallas-based Invesco Real Estate has purchased 1800 Larimer, the first new office tower built downtown in 25 years.
The sale price for the 495,518-square-foot building was not disclosed, but industry insiders put the price at about $213 million, or $430 a square foot.
On a per-square-foot basis, that's a record price for a Denver office property, they said. Transactions that approached that price are the sale of the Janus headquarters at 151 Detroit St., which traded for $394 a square foot in 2007; and Tabor Center downtown, which sold for $380 a square foot the same year.
"This is really good for Denver," said Rich McClintock, chief executive of Westfield Development Inc., which developed the building. "This is a vanguard city. Usually you don't get pricing like this unless you're on one of the coasts.
"We've just come out of a very turbulent economic time with incredible uncertainty," McClintock said.
The 1800 Larimer building, which has an environmentally friendly certification known as LEED Platinum, is 90 percent leased, with Xcel occupying more than 70 percent of the building. The energy company's lease term runs for 15 years.
"Invesco is buying a solid income stream," said Mary Sullivan, an investment broker at Jones Lang LaSalle's Denver office. "It's nice to have the bells and whistles of the LEED certification, but the driving force was the income stream."
1800 Larimer features high-efficiency energy systems using under-floor air systems and floor-to-ceiling windows to maximize outdoor air and natural light. The 22-story building, designed by RNL, boasts a 17,000-square-foot outdoor terrace, a fitness center, conference facility, concierge security and indoor parking.
Investment in commercial real estate in metro Denver more than doubled last year over 2009, a sign that the market may be recovering.
Investors spent more than $1 billion on 54 office, retail and industrial properties, according to an analysis by Cushman & Wakefield. In 2009, they spent $448 million in 30 transactions. The data included only deals valued at more than $4.5 million.
The biggest deal, completed at the end of the year, was the sale of Granite Tower, a 561,691- square-foot building constructed in 1982 at 1099 18th St. It sold for $149 million, or $265 a square foot, to KBS Real Estate Investment Trust II.
Mike Winn, an investment broker with Cushman & Wakefield's Denver office, said the recovery of the global capital markets is making for a strong investment climate.
"Investors are buying core assets at record prices," he said. "It's an indication of the comfort level in downtown Denver. There's not a lot on the market today, but we're seeing a high level of interest for core trophy assets."
Source: http://www.denverpost.com/realestate
