A sign for the Denver West Business Park in Lakewood. (Courtesy DPC Cos. via The Denver Post)
The largest distressed office property in the Denver suburbs is poised to sell for about half the price it fetched in 2018.
A deal to sell 1.2 million square feet within Denver West Business Park in Lakewood for about $65 million was approved last week by Jefferson County District Judge Andrew Poland.
Public court records do not identify the expected buyer.
The deal would involve 17 office buildings straddling Interstate 70 currently owned by Greenwood Village-based DPC Cos. and Bridge Investment Group of Salt Lake City, Utah. They range from 20,000 to 103,000 square feet.
Records show the firms paid $144 million for 20 buildings within the Denver West Business Park seven years ago. At the time, DPC and Bridge said they expected to spend $16 million on improvements. The property was 78% leased.
The firms sold three of the buildings between 2020 and 2022 for a combined $35 million, records show.
But DPC and Bridge ran into trouble in late 2023. They’d financed the 2018 acquisition with a $120 million loan from Cleveland, Ohio-based KeyBank, which needed to be paid off five years later.
Normally, firms would either sell or secure a new loan. But the pandemic had hit in the interim, upending the office sector, and resulted in what DPC CEO Chris King called “a frozen lending market.” Unable to secure a new loan, and with their property likely worth less than they’d paid, the firms defaulted.
In June 2024, KeyBank successfully petitioned Poland to appoint M. Shapiro Management Co. as receiver overseeing the property. The bank said the two firms still owed $99 million in principal.
In an Aug. 29 court filing, M. Shapiro wrote that it hired a broker to market the property for sale and that the $65 million deal is “in the best interest of the Receivership Estate.”
If the three buildings that DPC and Bridge already sold are ignored, the two firms paid $122 million in 2018 for the 17 buildings set to be sold. A sale at $65 million would represent a 46% discount.
An M. Shapiro executive and an attorney representing the receiver did not respond to requests for comment last week. Nor did a DPC executive.
Read more: Troubled towers: Breaking down Denver’s distressed office properties
Read more: Denver’s reluctant landlords: Lenders taking growing number of office buildings
A sign for the Denver West Business Park in Lakewood. (Courtesy DPC Cos. via The Denver Post)
The largest distressed office property in the Denver suburbs is poised to sell for about half the price it fetched in 2018.
A deal to sell 1.2 million square feet within Denver West Business Park in Lakewood for about $65 million was approved last week by Jefferson County District Judge Andrew Poland.
Public court records do not identify the expected buyer.
The deal would involve 17 office buildings straddling Interstate 70 currently owned by Greenwood Village-based DPC Cos. and Bridge Investment Group of Salt Lake City, Utah. They range from 20,000 to 103,000 square feet.
Records show the firms paid $144 million for 20 buildings within the Denver West Business Park seven years ago. At the time, DPC and Bridge said they expected to spend $16 million on improvements. The property was 78% leased.
The firms sold three of the buildings between 2020 and 2022 for a combined $35 million, records show.
But DPC and Bridge ran into trouble in late 2023. They’d financed the 2018 acquisition with a $120 million loan from Cleveland, Ohio-based KeyBank, which needed to be paid off five years later.
Normally, firms would either sell or secure a new loan. But the pandemic had hit in the interim, upending the office sector, and resulted in what DPC CEO Chris King called “a frozen lending market.” Unable to secure a new loan, and with their property likely worth less than they’d paid, the firms defaulted.
In June 2024, KeyBank successfully petitioned Poland to appoint M. Shapiro Management Co. as receiver overseeing the property. The bank said the two firms still owed $99 million in principal.
In an Aug. 29 court filing, M. Shapiro wrote that it hired a broker to market the property for sale and that the $65 million deal is “in the best interest of the Receivership Estate.”
If the three buildings that DPC and Bridge already sold are ignored, the two firms paid $122 million in 2018 for the 17 buildings set to be sold. A sale at $65 million would represent a 46% discount.
An M. Shapiro executive and an attorney representing the receiver did not respond to requests for comment last week. Nor did a DPC executive.
Read more: Troubled towers: Breaking down Denver’s distressed office properties
Read more: Denver’s reluctant landlords: Lenders taking growing number of office buildings
