Justin Borus stands in front of the office building his company purchased last month. (Matt Geiger/BusinessDen)
Justin Borus was staring down a lease renewal in Denver’s Cherry Creek North that would have seen his all-in rent costs top $100 a square foot annually.
Instead, he opted to buy.
The CEO of Ibex Investors, which manages VC and stock funds, bought the 6,300-square-foot office at 101 S. Madison St. last month for $3.75 million, or $599 a square foot.
“Even by taking out a loan and ongoing maintenance and property taxes and that kind of stuff, it should save us over half of what we were paying at our previous office space,” Borus said.
The building is a mile from 260 Josephine St., where Ibex has operated since 2019. It’s outside of the core Cherry Creek business district, which is one of the county’s hottest office markets, with new buildings continuing to go up.
“We thought it became less attractive,” Borus said of Cherry Creek North. “It’s more expensive, more crowded, way too much construction — the convenience that we were originally kind of paying for had gone away,” he said.
Ibex has been around since 2012 and has always had its American office in Cherry Creek. The company primarily invests in Israeli companies and also has an office in Tel Aviv. It recently closed a $113 million fund and is launching another of the same size.
The Madison Street building is the company’s first real estate purchase.
“The only other real estate transaction I’ve ever done is buy my house,” Borus said.
The building currently sits in a core-and-shell condition, needing furniture and fixtures. Borus anticipates the build-out will cost $1 million and his team of 20 will move this time next year.
Casey Grosscope of CBRE represented the seller in the deal. (Matt Geiger/BusinessDen)
The Madison Street building was sold by Michael Horton. The former oil and gas executive turned developer and investor said he spent $1.4 million improving the building on top of the $3.1 million he paid in 2022 to buy it. And that was just the cost to modernize the skeleton of the 50-year-old building.
“The market moved on me,” he said. “Ended up losing a million bucks on it. There was a ton of asbestos in the building. I really should have finished it out. I wasn’t sure what the market would want to do with it. I wasn’t sure. I was a little scared to build it out for office.”
Horton came to Denver 20 years ago and made his fortune selling his previous businesses for a combined $8 billion, he said. Now, he works in two sectors, building and remodeling luxury homes and buying RV and mobile home parks.
The Madison Street project was the second office building Horton bought and renovated. The 46-year-old had planned to move his mobile home business, Good Living Communities, into the building. But his business soured as private equity entered the sector and began buying up properties, he said. As opportunities shrunk, so did his headcount.
“That’s a sad story,” Horton said.
All the while, he was renovating the asbestos-ridden 101 S. Madison St., adding more windows, improving landscaping and adding finishes to its exterior. But Horton was too wrapped up in the rest of his real estate portfolio to finish the job. And he no longer had the manpower to fill the space for his own company.
“It was just a bad read,” he said. “And I got deep into it. Ibex, at their basis, and then with having buildable plans, I think they’ll do quite well as long as they don’t overspend, which it’s easy to do when it’s your own office and your own project.”
Justin Borus stands in front of the office building his company purchased last month. (Matt Geiger/BusinessDen)
Justin Borus was staring down a lease renewal in Denver’s Cherry Creek North that would have seen his all-in rent costs top $100 a square foot annually.
Instead, he opted to buy.
The CEO of Ibex Investors, which manages VC and stock funds, bought the 6,300-square-foot office at 101 S. Madison St. last month for $3.75 million, or $599 a square foot.
“Even by taking out a loan and ongoing maintenance and property taxes and that kind of stuff, it should save us over half of what we were paying at our previous office space,” Borus said.
The building is a mile from 260 Josephine St., where Ibex has operated since 2019. It’s outside of the core Cherry Creek business district, which is one of the county’s hottest office markets, with new buildings continuing to go up.
“We thought it became less attractive,” Borus said of Cherry Creek North. “It’s more expensive, more crowded, way too much construction — the convenience that we were originally kind of paying for had gone away,” he said.
Ibex has been around since 2012 and has always had its American office in Cherry Creek. The company primarily invests in Israeli companies and also has an office in Tel Aviv. It recently closed a $113 million fund and is launching another of the same size.
The Madison Street building is the company’s first real estate purchase.
“The only other real estate transaction I’ve ever done is buy my house,” Borus said.
The building currently sits in a core-and-shell condition, needing furniture and fixtures. Borus anticipates the build-out will cost $1 million and his team of 20 will move this time next year.
Casey Grosscope of CBRE represented the seller in the deal. (Matt Geiger/BusinessDen)
The Madison Street building was sold by Michael Horton. The former oil and gas executive turned developer and investor said he spent $1.4 million improving the building on top of the $3.1 million he paid in 2022 to buy it. And that was just the cost to modernize the skeleton of the 50-year-old building.
“The market moved on me,” he said. “Ended up losing a million bucks on it. There was a ton of asbestos in the building. I really should have finished it out. I wasn’t sure what the market would want to do with it. I wasn’t sure. I was a little scared to build it out for office.”
Horton came to Denver 20 years ago and made his fortune selling his previous businesses for a combined $8 billion, he said. Now, he works in two sectors, building and remodeling luxury homes and buying RV and mobile home parks.
The Madison Street project was the second office building Horton bought and renovated. The 46-year-old had planned to move his mobile home business, Good Living Communities, into the building. But his business soured as private equity entered the sector and began buying up properties, he said. As opportunities shrunk, so did his headcount.
“That’s a sad story,” Horton said.
All the while, he was renovating the asbestos-ridden 101 S. Madison St., adding more windows, improving landscaping and adding finishes to its exterior. But Horton was too wrapped up in the rest of his real estate portfolio to finish the job. And he no longer had the manpower to fill the space for his own company.
“It was just a bad read,” he said. “And I got deep into it. Ibex, at their basis, and then with having buildable plans, I think they’ll do quite well as long as they don’t overspend, which it’s easy to do when it’s your own office and your own project.”
