Residential real estate in Denver captures plenty of headlines when it comes to the lofty prices potential buyers face in today’s market. Figures from the Denver Metro Association of Realtors in August state the median price for a single family home in Denver is $459,900; for condos, it’s $310,000.
From tony downtown condos to classic brick Hilltop homes, Denver continues to be a hotbed for home sellers. The Mile High City remains one of the top markets in the country, a result of a booming economy, desirable lifestyle and its appeal to a broad demographic. According to WalletHub, Denver is ranked 4th best among large cities as the Best Real Estate Market.
But what about Denver’s commercial counterpart?
Parking Lots, Buildings are in Demand
Well, parking lots, land and tattered buildings are being scooped up, too, for prices that are hard to fathom. Since the beginning of the year, Denver has seen some pretty dramatic commercial real estate transactions occur.
Capturing headlines in August was the sale of Buzz Geller’s Paradise Land Company’s .57 acre parking lot at 650 -17th St. for a cool $17.5 million ($699/square foot). However, equally if not more impressive, was the purchase of the Cooper Building at 1027 – 21st St. in April. Housing a tattoo parlor and a convenience store, Property Markets Group out of New York paid a staggering $4.8 million for the 2,264 square foot building standing on .29 acres. Slated as a redevelopment project, the deal worked out to $2,120 per square feet ($2,120 is not a misprint).
According to CBRE via the CoStar site, the top 10 raw land sales in the City and County of Denver since January has seen prices commanding anywhere from $300-$600 per square foot. The range for commercial buildings was between $1,000-$3,600/square foot. Keep in mind, some of those buildings may well be scrapes in the end.
To put this in perspective, luxury residential real estate (single family homes and condos selling for $1 million or more) fetched an average of $332/square foot in August according to DMAR. Signature homes (single family homes and condos selling for $750,000-$999,000) commanded $254 per square foot.
The blistering commercial real estate market in Denver is a smorgasbord of transactions, ranging from existing offices buildings simply changing hands to plans for mixed use developments (see Rockies Development – McGregor Square) and entertainment complexes like Meow Wolf. The city’s appeal has attracted developers and investments from inside and outside the state, and new business corridors outside of the downtown area are being both envisioned and created (e.g. RiNo, Globeville).
Multifamily Housing Developments Lead the Way
Multifamily housing and mixed-use developments continue to be the focus of many of the developers as opposed to new office buildings. Interestingly, a recent report by Tex-X Commercial, one of the nation’s leading transaction platforms for online commercial real estate sales, projects Denver to experience a drastic change in rent prices for office space. According to an article in Mile High CRE, it named Denver a top ‘sell’ market for office space. When compared to Nashville, Dallas, Austin, and Chicago – the four other top ‘sell’ markets – Denver is expected to experience a 3.3 drop in rent for office space to $19.47 per square foot by 2022. Some of the reasons for this include changing work norms, remote work policies, and co-working space.
A rudimentary analysis of current construction and recently completed buildings certainly supports the trend away from office space development. Of the 41 properties featured on the Denver Infill site, from Dec. 2018 to present, nearly half were new apartment complexes or developments that incorporated apartments with retail and/or office space. Nine properties were designated as office buildings or medical buildings. Hotels, condos, hostels or mixed-use developments comprising residential/hotel/office space comprised the remaining sites.
Below you will find the CBRE via CoStar report detailing the Top 10 Most Expensive Commercial Real Estate Transactions for both raw land and commercial buildings from Jan. 1-Aug. 29, 2019. One property — 1027 – 21st St. — was listed on both, presumably since it’s slated as a redevelopment project where the building will be razed.
Top 10 Commercial Buildings Sales in Denver, Jan. 1-Aug. 29, 2019
(Data provided by CBRE via CoStar)
#1 & 2 — Topping the list is a two-parcel sale at 4195 Colorado Blvd. Slated for redevelopment, the present site is a retail/service station built in 1974 and a parking area.
Address: 4195 Colorado Blvd. (Parcel 2244-16-034)
Sale price: $1,650,000
Price/sf: $3,683.04
Land area: .27 acres
Proposed use: Redevelopment project
Buyer: Venway LLC (Betsey Wagner)
Seller: Clay County Trust (Morganville Development)
Sale date: 8/6/19
Address: 4195 Colorado Blvd. (Parcel 2244-16-018)
Sale price: $1,000,000
Price/sf: $2,232.14
Land area: .27
Proposed use: no information
Buyer: Astowell LLC (Betsey Wagner)
Seller: 4195 Colorado Blvd Property LLC (All Copy Products)
Sale date: 7/31/19
#3 — 1027 – 21st St. is comprised of the 1906 Cooper Building and accompanying parking lot. It currently is home to a tattoo parlor and convenience store, but is slated as a redevelopment project.
Address: 1027 – 21st St.
Sale price: $4,800,000
Price/sf: $2,120.14
Land area: .29 acres
Proposed use: Redevelopment project
Buyer: Property Markets Group, Inc., New York
Seller: Mary Martinez, Arvada
Sale date: 4/15/2019
#4 & #5 — This commercial flip transaction of 4995 Washington St. (on the same day) will become an affordable housing project. Purchased by the City and County of Denver, the former 2.7 acre site was previously an auto dealership.
Address: 4995 Washington St.
Sale price: $6,000,000
Price/sf: $1,714.29
Land area: 2.70 acres
Proposed use: Redevelopment project (affordable housing)
Buyer: City and County of Denver
Seller: TRE 4995 LLC, Denver
Sale date: 1/14/19
Address: 4995 Washington St.
Sale price: $5,100,000
Price/sf: $1,457.14
Land area: 2.70 acres
Proposed use: immediate resale
Buyer: TRE 4995 LLC, Denver
Seller: Vincent Salzano
Sale date: 1/14/19
#6 — Currently a freestanding building home to Starbucks, this transaction was a 1031 exchange. The business, located at 3087 S. Sheridan Blvd., is on the southwest corner of Sheridan and Colgate Place.
Address: 3087 S. Sheridan Blvd.
Sale price: $2,425,000
Price/sf: $1,283.07
Land area: .42 acres
Proposed use: no information
Buyer: SM Brand Corp., Pacific Palisades, CA
Seller: Kch Sheridan LLC, Southlake, TX
Sale date: 1/18/19
#7 — Formerly D&B’s Liquor Store, this location at 4101 Colorado Blvd. is just south of Smith Rd. and a few blocks from the 40th and Colorado A line train station.
Address: 4101 Colorado Blvd.
Sale price: $1,650,000
Price/sf: $1,178.57
Land area: .33 acres
Proposed use: no information
Buyer: Hands, LLC
Seller: Clay County Trust
Sale date: 8/6/19
#8 — Previously an Arby’s fast food restaurant, Chase Bank purchased the property at 2310 E. Colfax Ave. and will be converting it into a branch bank. The parcel had been on the market for over 3 years.
Address: 2310 E. Colfax Ave.
Sale price: $3,500,000
Price/sf: $1,101.67
Land area: .57 acres
Proposed use: no information
Buyer: JP Morgan Chase, Columbus, OH
Seller: S&G Realty Co
Sale date: 4/18/19
#9 — This Stinker gas station/convenience store was renovated in 2012 and was part of a portfolio sale. It is located at a busy intersection in southeast Denver at 2107 S. Holly St.
Address: 2107 S. Holly St. (Part of a Portfolio)
Sale price: $3,398,500
Price/sf: $1,058.06
Land area: .25 acres
Proposed use: no information
Buyer: Joshnik Co. LLLP, Boise, ID
Seller: GB&L Investment Co.
Sale date: 4/4/19
#10 — Part of the bankruptcy sell-off of real estate investor Gary Dragul, who has been charged with numerous counts of securities fraud, this sale includes a Dunkin’ Donuts and MVMT Pilates Studio at 4820 E. Hampden Ave. These are new buildings, built in 2016.
Address: 4820 E. Hampden Ave. (Multi-Property sale, Happy Canyon Shopping Center)
Sale price: $5,672,552
Price/sf: $1,031.37
Land area: .33 acres
Proposed use: no information
Buyer: Bellray Happy Canyon 608 LLC, Centennial
Seller: HC Shoppes 18 A LLC, Greenwood Village
Sale date: 4/17/19
Top 10 Commercial Land Sales in Denver, Jan. 1-Aug. 29, 2019
(Data provided by CBRE via CoStar)
#1 — 1027 – 21st St. is cross-listed in both land and commercial building sales. See description (#3) in previous top 10 commercial building sales.
Address: 1027 – 21st.
Sale price: $4,800,000.00
Price/sf: $2,120.14
Land area: .29 acres
Proposed use: Redevelopment Project
Buyer: Property Markets Group, New York
Seller: Mary Martinez, Arvada
Sale date: 4/15/19
#2 — This former industrial site at 3860 Blake St. will be part of the World Trade Center complex in RiNo, adjacent to the 38th and Blake RTD commuter rail station. The proposed development will include a hotel and office space.
Address: 3860 Blake St.
Sale price: $13,500,000.00
Price/sf: $630.40
Land area: 1.13 acres
Proposed use: Redevelopment Project
Buyer: WTC Acquisition, Denver
Seller: Carbat LLC, Denver
Sale date: 6/27/19
#3 — Plans for this parking lot at 235 Fillmore St. are still in the works but the ground level is expected to have retail space. The property is zoned for up to five stories
Address: 235 Fillmore St.
Sale price: $12,000,000.00
Price/sf: $542.35
Land area: .51
Proposed use: Apartments
Buyer: 235 Fillmore Partners, Denver
Seller: WDG Construction, Denver
Sale date: 6/10/19
#4 — Originally slated for a 13-story apartment complex with 238 units, this site at 600 Park Ave. West sold for nearly double what Alsation of Mission Hills, Kan., paid last year ($5.16 million). It’s still indicated that the property will be used for apartments, but no other information is available.
Address: 600 Park Ave. West
Sale price: $9,078,500
Price/sf: $289.03
Land area: .72 acres
Proposed use: Apartments
Buyer: GDCV III Arapahoe Square, Denver
Seller: Alsation 600 Park LLC, Mission Hills, KS
Sale date: 8/8/19
#5 — A 14-story hotel has been proposed for this site, 822 – 18th St. It’s located next to Champa St.
Address: 822 – 18th St.
Sale price: $8,000,000
Price/sf: $638.06
Land area: .29 acres
Proposed use: no information
Buyer: MHF Denver DT VI LLC, Denver
Seller: Lewin Properties, Denver
Sale date: 3/12/19
#6 — This parking lot at 1320 Glenarm Place is expected to be turned into a 12-story hotel with over 300 rooms.
Address: 1320 Glenarm Place
Sale price: $7,100,000
Price/sf: $324.57
Land area: .50 acres
Proposed use: no information
Buyer: Fire House Lodging LLC, Coralville, IA
Seller: CS Glenarm Denver LLC, Rockville, MD
Sale date: 1/29/19
#7 — A 12-story apartment building has been proposed for this site at 2039 – 19th St., which would primarily be micro-units (studios). The buyer, Pando Holdings, also developed the Economist in City Park West, which also features studio apartments.
Address: 2039 – 19th St.
Sale price: $6,250,000
Price/sf: $387.79
Land area: .37 acres
Proposed use: Multifamily housing
Buyer: 19th & Chestnut, Denver
Seller: Black 11, LLC, Denver
Sale date: 7/1/19
#8 — This parking lot at 2000 Blake St. is located next to the View House and is directly across from Coors Field. Plans for the property are unknown.
Address: 2000 Blake St (Portfolio Sale)
Sale price: $4,400,000
Price/sf: $310.95
Land area: .32 acres
Proposed use: no information
Buyer: Fillmore Capital Partners, San Francisco
Seller: Tavern Hospitality Group, Denver
Sale date: 2/14/19
#9 — Early plans for this parking lot at 2120 Arapahoe St. call for a 22-story apartment complex that will also include coworking space and retail.
Address: 2120 Arapahoe St.
Sale price: $3,100,000
Price/sf: $496.00
Land area: .14 acres
Proposed use: no information
Buyer: XSC Denver 3.0 Investment LLC, Miami
Seller: Arapahoe Square Holdings LLC, Broomfield
Sale date: 1/28/19
#10 — This former industrial building is expected to be transformed into a 12-story, 200,000 square foot office building. This site at 3623 Delgany St. is situated one block from Brighton Blvd.
Address: 3623 Delgany St. (Multi-Property Sale)
Sale price: $2,027,425
Price/sf: $304.92
Land area: .15 acres
Proposed use: Redevelopment project
Buyer: Delgany LLC
Seller: Delgany Ventures LLC, Castle Rock
Sale date: 3/21/19