The new buyer of the former Intel building says prospects for the 1.4 million-square-foot facility are strong – and he expects to have it 70 percent leased within three years.
Known as the company’s “Houdini deal maker,” Bruce Haas says the commercial real estate market is alive and well. The senior vice president for Industrial Realty Group was in town Wednesday to discuss possibilities for the building, which they purchased last fall for $15.1 million.
Properties are available at bargain – sometimes pro bono – prices from companies like Delphi, Ford Motor Co., Goodrich and General Motors, he told the Realtor Commercial Industrial Society members at a luncheon on the Intel campus.
IRG is a Los Angeles-based company that has been around for more than 30 years and specializes in adaptive reuse and historic preservation. Currently, the company owns more than 70 million square feet of commercial property scattered throughout the country.
“If we were a publicly owned company, we would be among the Wall Street Journal’s top 10 REIT (real estate investment trusts),” Haas said, adding that company president Stuart Lichter was on a four-property buying trip this week.
“It’s a great market out there for investors like IRG that specialize in redevelopment and historic preservation. And we often take on properties others won’t consider; some have serious contamination issues like a Ford plant in Saginaw, Mich., or a superfund site like the former McClellan Air Force Base on 3,000 acres with 1 million square feet of historic buildings that we bought in 2000.
“Our projections were that we’d have it 50 percent leased in 10 years, but today we’re 70 percent leased and have brought 10,000 new jobs to the area. Here in Colorado Springs, we expect to have Corporate Ridge (the site’s new name is actually Corporate Ridge Office and Technology Center), 60- to 70-percent leased within three years,” he said.
His comments followed an introduction by Grubb & Ellis Quantum Commercial Group listing broker Michael Palmer who outlined how approximately 1.3 million square feet in four buildings would be marketed. One of the largest single buildings, the 710,000-square-foot former Fab plant, offers three 220,000-plus square-foot floor plates, would most likely be used by an energy or technology manufacturer, but not another chip maker.
Corporate Ridge has already attracted brisk interest from multiple prospective users, Palmer said, adding that the owner expects to announce a new tenant this spring that will create 250 new jobs immediately, with another 200-plus to follow.
“Not only are the campus’ four buildings attractive to a variety of prospects, but the amenities this complex have to offer are tremendous,” Palmer said, emphasizing the importance of an on-site cafeteria, adjacent covered and surface parking, a central utility building – which is attractive to high volume data center and technical users – as well as the facility’s “plug-and-play” convenience for administrative and back office tenants.
And IRG has wasted no time in getting word out to prospective tenants, both national and local.
“We anticipate that a good portion of our tenants will come from local companies who already have a presence here, but just want to expand or add a new division,” Haas said. In addition, project marketing has involved contact with key corporate and educational neighbors like the University of Colorado at Colorado Springs, with whom IRG representatives have met on two occasions.
“A lot of our properties are home to educational organizations – community colleges, private colleges, charter schools … it’s very likely that Corporate Ridge could attract some tenants in those categories. We also have some excellent contacts in the solar energy business. That industry – and wind power – is changing fast and we want to be in front of it,” he said. “Bottom line, Colorado Springs is affordable, it offers a quality work force, and it has great education resources. My daughter attends Colorado College, so I’m fortunate to get to visit fairly often.”