by Jill Jamieson-Nichols
United Properties is
heading to the southeast
suburban submarket for
its latest big development
in the Denver area.
United Properties, in a
joint venture with Princi-
pal Real Estate Investors,
purchased 58 acres at the
southeast corner of South
Havana Street and East
Easter Avenue to develop
Dry Creek Corporate Cen-
ter, a mixed-use project
that will include approxi-
mately 650,000 square feet
of single- and multitenant
office and industrial space.
Construction will start
next spring with a 182,000-
sf multitenant office build-
ing.
Equity Office Proper-
ties Trust sold the land in
a $8.2 million deal han-
dled by Newmark Grubb
Knight Frank brokers
Jason Addlesperger and
David Lee. Mike Wafer,
also of NGKF, represented
United Properties.
“This is one of the larg-
est fully entitled parcels
of land in the heart of the
s o u t h -
east sub-
u r b a n
market,”
s a i d
K e v i n
K e l -
ley, vice
p r e s i -
dent of
U n i t e d
P r o p -
erties. “With improving
market conditions and
low supply, we’re excited
to bring this new Class A
product to market.”
The acquisition included
multifamily and hotel sites
that will be sold to outside
developers.
Dry Creek Corporate
Center is next to the Dry
Creek light-rail station,
Inverness Business Park
and Centennial Airport,
approximately 20 minutes
from downtown. With
United Properties seeking
LEED certification of all of
the buildings, the project
will include facilities for
bike commuters, including
dedicated building entries
with showers, lockers,
repair areas and bike rent-
als; a dedicated shuttle to
transport employees to
and from the light-rail sta-
tion; and pads for food
trucks, complete with cov-
ered dining areas.
“We are offering rental
rates of under $20 per
by John Rebchook
Milestone Apartments, a real
estate investment trust based
in Toronto, recently paid $40.5
million for the 221-unit Village
at Legacy Ridge in Westmin-
ster.
The community at 3850 W.
112th Ave. was sold by Den-
ver-based Corum Real Estate
Group.
The sale equates to $183,326
per unit.
Legacy Ridge was built in
2001 on a 12.3-acre site and
currently is about 97 percent
occupied.
The average monthly rent is
about $1,200 per unit.
The average rents are higher
than the average rents in the
REIT’s portfolio, according to
Milestone.
One reason the rents are
higher is because the Village
at Legacy Ridge has a higher
proportion of two- and three-
bedroom units than found in
its overall portfolio, according
to Milestone.
Milestone was drawn to the
property because of its proxim-
ity to both Boulder and down-
town Denver.
As part of the purchase,
Milestone assumed a fixed-rate
mortgage of about $23.6 mil-
lion at an interest rate of 3
percent.
The loan is fully amortized
on a 35-year schedule maturing
by John Rebchook
Matt Joblon’s company,
Cherry Creek-based BMC
Investments, is developing
the most expensive apart-
ment tower in Denver’s his-
tory.
The $108 million, 218-unit
Steele Creek apartment tower
that is under construction
at First Avenue and Steele
Street in the heart of Cherry
Creek North costs more than
$400,000 per door.
It is projected to get blend-
ed rents averaging the high-
est in Denver at about $3.50
per square foot, with pent-
house units getting far north
of that amount.
It also is the 33-year-old
Joblon’s first development.
”You really started at the
top of the ladder,” said Cary
Bruteig, owner of Apartment
Appraisers & Consultants,
when he introduced Joblon
as a development panel
member at a recent Colorado
Real Estate Journal multifam-
ily conference.
As big as it is, Steele Creek
is not the only development
on Joblon’s real estate plate.
He also has a $68 mil-
lion, 155-room hotel going
forward in Cherry Creek
North in a partnership with
Sage Hospitality and a $70
million,12-story, medical
office that will have approxi-
mately 200,000 sf planned
near the Anschutz Medical
Campus at Fitzsimons.
Steele Creek, which already
is 10 percent preleased, may
be at the top of the Denver
apartment food chain, but
Joblon has focused on the
other end of the apartment
spectrum since arriving in
the Mile High City just a few
years ago.
Since 2011, BMC (which
stands for Building Manage-
ment Co.), has purchased
3,489 apartment units for
$227.7 million in the Denver
area. Of that, $164 million
was in debt and about $64
million was in equity.
“They were all 1970s era
apartments,” Joblon said
from his office in Cherry
Creek North, where about a
dozen people work. BMC has
a total of about 70 employees,
most of them in its property
division.
Joblon, who is incredibly
analytical and risk-averse,
was bullish on the Denver
market from the get-go,
based on the same metrics
that everyone likes, such as
demand fueled by Denver’s
quality of life, job growth, its
magnetic role for millennials
and the difficulty or indiffer-
ence of young people to buy
a home, pushing them into
the rental market.
And until the latest build-
ing boom, there was a lack
of supply of apartments to
meet the growing demand,
as construction had come to
a standstill during the Great
Recession.
“But even I’ve been sur-
prised just how strong the
apartment market has been,”
he said.
It may seem like he had the
Midas touch, given that his
timing was so good.
Joblon, however, said his
path has not been without
missteps.
“I made 1,000 mistakes
along the way,” Joblon said.
However, a great market
made up for all of his mis-
takes, he said.
Even more importantly, he
learned from his errors and
engendered trust in his inves-
tors, helping him to attract
even more people willing to
write him checks with many
zeroes.
“I took full responsibility for
all my mistakes and owned up
to them,” Joblon said. “I was
ridiculously transparent.”
He didn’t have to be.
His investor pool includes
well-heeled real estate devel-
opers and investors from
New York City.
“Honestly, these guys don’t
look at the closing docu-
ments,” where they might
have discovered his momen-
tarily lapse of good judg-
ment.
One of his “doozies” was
in his first deal, an 81-unit
building purchased for $4.1
million.
He realized he only had
$600 in an account for an
operating cushion, in case
they needed more money for
any unforeseen problem.
“I sent my partners a
memo and told them it was
my mistake and I wasn’t
going to come back to them
for a capital call,” ask-
ing them to pony up more
money, he said.
Instead, he said he would
put up the money personally
at a zero percent interest rate.
Only one problem.
He didn’t have any money.
Somehow, though, he man-
aged to get a $60,000 line of
credit that he was willing to
put into the account, which
got drawn down to $200.
Cash flow after the closing
was so strong that he never
had to kick in the money.
“I tell you, I couldn’t sleep
at night,” during that period,
he said.
Matt Joblon
SECTION AA
NOVEMBER 19-DECEMBER 2, 2014
Village at Legacy Ridge recently sold.
Kevin Kelley
