Colorado Real Estate Journal - Octover 7, 2015
Denver’s tight industrial market is making it difficult for local companies to find room to grow, but a 35-year-old commercial architectural millwork company is thriving after achieving that goal and selling its existing location for a record price. “Our physicality has more than doubled,” JK Concepts Inc. owner Margery Johnson said of the company’s move to 37,440 square feet at 3333 E. 52nd Ave. in Denver’s Swansea neighborhood. “We’re in a better and stronger position in our new building to successfully accommodate the growing demand for what we do.” A limited liability company Johnson manages purchased the building, formerly occupied by Colorado Doorways, for $3.1 million late last year and immediately started construction to turn it into its new, long-term home. It completed a reverse 1031 exchange this summer with the sale of its 17,945-sf building at 200 Lipan St. in Denver at $1.73 million. The price equates to $96 per sf, a record price for the central Denver industrial building, according to Dawn McCombs of Avison Young, who represented JK Concepts in the transactions. Johnson said JK Concepts’ previous location in the Baker neighborhood was in “a wonderful neighborhood” that is going through a renaissance. “The neighborhood we’re in now, even with the expansion of I-70, will be a strong industrial neighborhood in the future,” she said, adding it provides easy freeway access for trucks and deliveries. Finding the building wasn’t easy, however, especially with marijuana growers consuming so much older industrial product in Denver, said Johnson. Asked why the company chose the location, Johnson said, “The reason is simple: Dawn found it for us while it was not listed, and then she worked for about a year to make it work for both us, as the buyer, and the seller. The value of having a broker who knew our company and its needs, as well as the construction industry, with a pulse on the commercial real estate market, was the key to selecting this property,” she said. Johnson said the building needed to allow a doubling of the company’s capacity, with appropriate zoning, access to power, good parking and potential for future growth. The building also needed to provide for enhanced efficiency for production, and shipping and receiving, and have good access to highways. Also key was accommodating the company’s culture for safety, room for upgraded equipment and a comfortable workplace, she said. In addition, JK Concepts needed to complete a reverse 1031 because of timing related to the seller’s move and significant remodeling. “With Dawn, all of this was understood,” Johnson said. JK Concepts, which does architectural millwork for schools, hospitals, medical office buildings and other commercial projects, saw a surge of pent-up demand as Colorado’s economy strengthened after the recession – and a shortage of skilled tradespeople. “I think we’ve positioned ourselves to be an attractive workplace so that skilled craftsmen and people interested in the trades find it an inviting place to work,” Johnson said, adding the company prides itself on safety, which is important to workers. The new location provided capacity for new, upgraded equipment. JK Concepts plans to improve the property’s cosmetics as time permits, as it did at its previous home in the Baker neighborhood, according to Johnson. “Dawn found this location, and I have to give her full credit. It has a lot of positive features, and I think we’re going to be able to make it a wonderful home for our company so we can successfully expand and grow to meet the demand of the commercial millwork market,” Johnson said.