Colorado Real Estate Journal - March 16, 2016
A “textbook” value-add apartment property in Colorado Springs was picked up by a Utah-based buyer adding to its Colorado portfolio. Millburn & Co. paid $49.6 million, according to public records, for The Retreat at Cheyenne Mountain. “It was a perfect 1990s valuea-dd property,” Kevin McKenna of ARA Newmark said of the 276-unit community at 1735 Presidential Heights. The property’s location in the Broadmoor submarket, lack of construction in the area, being situated on one of the biggest multifamily sites in the city and the ability for rents to grow drew double-digit offers, added McKenna, who, with ARA Newmark’s Jeff Hawks, Doug Andrews and Saul Levy, represented the unidentified seller. The sales price of around $180,000 per unit also is the second-highest price ever paid for an apartment community in Colorado Springs – only second to the $187,963 per unit paid for The Pines at Broadmoor Bluffs. Built in 1998, The Retreat at Cheyenne Mountain features one-, two- and three-bedroom apartments, which are around 95 percent occupied at the time of sale. Apartments feature carpet or plank flooring, as well as 9-foot high ceilings, kitchen pantries, and garden tub and walk-in closets in the bedrooms. Select apartments also feature kitchens with a stainless steel appliance package, vaulted ceilings, built-in bookshelves, gas fireplaces, a kitchen island and attached garage. Community amenities include a heated swimming pool, picnic and grilling area, business center and community meeting room. There also is an easily accessible clothes care center on site. Reserved, covered parking also is available for models without an attached garage. The buyer plans to continue unit upgrades and clubhouse improvements started by the seller. Other News A Colorado-based national self-storage real estate investment trust recently acquired a 50,810-square-foot Pueblo storage facility at a price of $60.02 per sf. The buyer paid $3.05 million for the Affordable Storage Solutions property at 90 Greenhorn Drive in southern Pueblo. Built in phases from 2008 to 2014, Affordable Storage Solutions is one of the newest self-storage facilities in the area. It features visibility from Interstate 25, an institutional-quality leasing office and is under 24-hour video surveillance with electronic gate access. The property features one- and two-story buildings that comprise 396 units with both interior climate-controlled and standard drive-up units. “This acquisition further illustrates the willingness of our industry’s largest companies to enter secondary and tertiary markets if the quality and yield is there,” said Adam Schlosser, vice president, investments, at Marcus & Millichap. He, along with Chico LeClaire, senior vice president, investments, represented the seller, a local private investor. Commonwealth recently released its year-end apartment sales report for Colorado Springs. Over 2015, 30 apartment properties sold totaling 4,398 units with a sales volume of $409.92 million – below the total sales volume of just over $472 million in 2014. The report noted that three Class A properties sold in 2015, totaling 616 units at an average of $166,153 per unit and $157 per sf. Sales volume within the Class A market totaled $102.35 million while the top price per unit was The Pines at Broadmoor Bluffs at $187,963. The Class A market also saw the highest price paid per sf commanded by the 314-unit Sagebrook at $161 per sf, however, it had the lowest unit price at $155,255. Within the Class B apartment market, Commonwealth reported four sales during 2015. The properties sold totaled 946 units with a total sales volume of $107.75 million. The highest price paid was for the Advenir at the Village (Sunset Creek), which commanded $120,161 per unit and $130 per gross sf. The property was built in the late 1960s. The highest price paid per sf was $145 for the 220-unit Cheyenne Crossing while the lowest price per unit was $100,000 for the 220-unit Union Heights complex. Additionally, the lowest price per sf was $112 paid for the 196-unit Parc at Briargate complex. The report also noted five Class C properties sold during the year totaling 1,239 units for a sales volume of $118.72 million and an average price per unit of $88,511 and $102 per sf. The sale of the Alturus at Bell Tower, Commonwealth commented, was not included in the Class C averages as it “would have skewed the date due to high price for location.” The Class D submarket, defined by Commonwealth as properties older than 30-years-old, in poor condition, in poor locations and no or limited amenities, saw the highest number of closings with 17 sales totaling 1,537 units and a sales volume of $81.1 million due to the value-add opportunities. The highest price paid was for the 120-unit Wind River Apartments at $62,542 per unit and the highest price per sf was for the 60-unit Mesa Vista apartments at $115 per sf. The lowest price paid per door was $37,931 for the 58-unit Gallery apartments and the lowest price per sf was $48 for the 41-unit Tiburon (Columbine) apartments