Second homes a thriving market; more deals close

Filed under: real estate column |

The announcement that Prime Center has been sold to out-of-town investors for over $43 million only reinforces what most brokers have been saying: Colorado Springs continues to be highly attractive to big investors. It seems that most local owners aren’t motivated – or desperate enough – to sell for bargain prices.

Commercial realtors head for powder

It’s time to head to Vail if you’re a commercial real estate mogul-masher, snow bunny or boarder. RCIS social chairman, Denise McMillon of Commonwealth Land Title says the event is open to RCIS members, affiliates and their guests. For $20 per person for members and $40 for all others, it’s a great deal. Included is the bus ride, a ski pass, breakfast, refreshments and the invaluable chance to rub shoulders with the Pikes Peak region’s finest (or wannabe) skiers. Call 475-8800 for more information.

Weighing in on Second Homes in Summit

Breckenridge realtor, Allan Johnson, recently sent along residential sales statistics on Summit County. According to Johnson, all 50 states are represented among property owners in the Breckenridge, Keystone, Copper Mountain and Arapahoe Basin ski areas. He promotes second home ownership to investors looking for solid appreciation and notes that 2003′s total sales revenues topped $291 million – up over a previous high of $278 million in 2000. Based on that 5 percent increase, it sounds like the second home market is back in full swing after two tough years.

Colorado residents, by the way, represent 52 percent of Summit County’s non-resident homeowners. Two other states showing a significant presence in ski country include Texas (6.8 percent of total) and Florida (4.9 percent). Illinois was fourth with a 4.4 percent stake in second or vacation homes.

Steinert Scores Triple Play

It’s not baseball season yet, but Grubb & Ellis/Quantum’s Leigh Steinert scored three leases last month for a new check cashing company. She represented the tenant, Allied Cash Advances, in two transactions – including new Woodland Park and Denver locations. The young broker – along with G & E colleagues, Cameron Mogadam and Craig Yatsu – also represented the owner, York Plaza Shopping, LLC, in placing ACA in an additional retail location off North Academy Boulevard. John Egan of Trammel Crow represented SW Woodpark, LLC on the Woodland Park deal.

Postscript on Village at Westmeadow Sale

Ken Greene and Apartment Realty Advisors announced the sale of the Village at Westmeadow apartment complex, but no sale details were available at press time. The selling price: $14.8 million. The price per square foot was almost $85 per square foot. That’s not bad for a community that has weathered a tough rental market with a 95 percent occupancy rate. The new owner is RK Properties of Long Beach, Calif.

The community is located just north of Ft. Carson – and is likely to see plenty of action as more than 10,000 troops return from the Middle East this spring.

Former Fitness Facility Leased to Dollar Stores

Jim Schwerin of the Windy Creek Companies just signed a long term lease with Family Dollar Stores, Inc. for approximately 9,000 square feet at 3770 Airport Road. The 17,000-square-foot building formerly housed a World Gym fitness center and was purchased by Windy Creek in July 2003.

Pre-occupancy work includes filling in a swimming pool, pouring a new concrete floor, installing new HVAC systems and tearing off and replacing the front of the building with a glass front. A spring 2004 move in is anticipated.

Schwerin says that while he worked directly with the new tenant on the lease transaction, he welcomes broker participation on the remaining 8,300 square feet.

“We would like to project an entirely new image for the property, since it had been vacant for over two years,” he says, “and continue to look for new deals where we can add value to something with underlying quality.”

Airport Industrial Park Land Sale

Leave it to Lloyd Riphenburg and Charley Conrad at The Olive Real Estate Group to move two acres of prime commercial property this past month. The buyer, Lovern Properties, LLC was represented by Brandon Smith of Keller Williams. They bought the parcel, located at Airport Road and Powers Boulevard, from Mike Underwood. The selling price was $240,000. The investor’s plans include construction of an owner-user office/warehouse facility with some sublease space.

Conrad works with a number of smaller industrial investors and owners – and notes that the Powers corridor and eastern parcels are currently the most active. “These sites are attractive to smaller users looking to acquire land and build their own structures,” he explains. “Good infill sites are hard to find.”

He also says undeveloped land prices under $3 per square represent a decent price. “By the time you go through entitlements, the approval process and improvements, it’s worth it.”

As far as outside investor participation in the Pikes Peak region is concerned, Conrad sees a slightly over-valued market, propelled by pressure from investor demand. “You see a lot of capital generated by 1031 deals – and some guys pay more than they should for commercial properties.”

Regarding the recent sale of the Prime West center in Briargate, the broker says the project’s 94-percent occupancy rate as a key motivator in the institutional buyer’s decision to purchase. “If I were the seller I’d have been very happy with that price,” he adds.

- Becky.Hurley@csbj.com