Southwestern Commercial Properties opens own office

Rumors that commercial real estate has dried up or has slowed to a crawl appear to be “highly exaggerated,” to borrow another phrase from Mark Twain.

The following update from around the region speaks to slower, but surprisingly steady deal-making in the Pikes Peak region.

In conjunction with LandCo Equity Partners’ announcement that the company will move to remodeled offices at 19 N. Tejon St., its former in-house brokerage, Southwestern Commercial Properties, has elected to move to 559 S. 8th St.

Southwestern’s five brokers –John Egan, Patrick Kerscher, Greg Kaufman, Robert Aertker and Mike Berger — have leased about 1,900 square feet of storefront space.

Kerscher said that SCP represents 32 retail properties from Monument to Pueblo. And, he said, the area really hasn’t seen a downward trend in lease rates.

“We get calls from out-of-state tenant reps working on (lease) renewals,” Kerscher said. “They’ll ask for a 25 percent break on rates, but we tell them no, the market’s not that soft here. At best an owner might give a $1 — or $2 (per square foot) at most — and that’s usually just rolled back into tenant improvements.”

Developers, on the other hand, are remaining conservative as national tenants have temporarily put expansion projects on hold. Construction funders are basing approvals on a loan-to-cost rather than loan-to-value basis, requiring 30 percent or more down.

“Most are waiting until mid-2009 to decide whether to move ahead on new locations,” Kerscher said. “On the other hand, regional and local business is active. We’re still working with a number of clients who are strong and want to take advantage of some good deals out there.”

The Shops at Bear Creek Plaza, near the intersection of 8th Street and Highway 24, was a SCP listing owned by LandCo. It opened last year to strong traffic, Kerscher said.

“So far Borrielo Brothers Pizza reports very good sales, and the new 7-11 will add a fuel island in the next month or two,” he said. “We also have activity on the remaining middle space.”

N. Union buildings sold

Central Colorado Springs still holds strong appeal for investors and owner-users, perhaps because of affordability — prices well below replacement cost in many cases — and easy access.

A 19,065-square-foot office building at 1465 N. Union Blvd. has been purchased by Rob Lowrey for $647,441.

Built during 1985, the property is occupied by multiple tenants.

Tim Leigh of Hoff & Leigh represented both the owner, Infinity Building LLC, and the buyer.

In related news, a 1,728-square-foot office building at 1935 N. Union Blvd. will be used for a dental office and was purchased by Gary and Marjean Horn LLC for $156,900.

Tim and Steve Leigh represented both the seller, J&D Fowler LLC, and the buyer.

Expanding, new business

Total Funding has expanded its operation and leased 2,764 square feet of office space in the Presidio, 1155 Kelly Johnson Blvd.

Brian Norton and Ted Link of Cascade Commercial Group represented the landlord, and Greg Phaneuf of Cushman/Wakefield represented the tenant.

Link said the Presidio is 85 percent occupied.

Dr. Lawrence Wang, a pediatric neurologist, has leased 1,688 square feet at 3245 International Drive.

He is starting his own business and will move into the space during May.

Link represented the landlord and tenant.

State leases space

The State of Colorado Department of Personnel, Office of Administrative Courts has leased 2,690 square feet of office space at 1259 Lake Plaza Drive.

The landlord, 5 Star Bank, was represented by Mark Hinton and Amy Callaghan of Coldwell Banker NRT. Mary Frances Cowan and Russell Stroud of Grubb & Ellis Quantum Commercial Group represented the tenant.

More leases signed

Steve Keinhofer, owner of Seventh Floor LLC, a shipping and receiving business, has leased 5,000 square feet of industrial space at 1460 Woolsey Heights from Richard Vaughn.

Lester Colodny of Hoff & Leigh represented both parties.

Colodny also represented A. Dickson Corp. in the 6,000-square-foot lease of industrial warehouse space at 3102 Beacon Street.

Tim Leigh of Hoff & Leigh represented the landlord, Interlochen Ltd.

Addressing the fact that the market has slowed, Colodny brushed off serious concerns for the commercial real estate industry.

“You just have to work harder, and get out there,” he said, adding that months or years from now a recovered market “will just seem easy.”

Becky Hurley covers real estate for the Colorado Springs Business Journal.