The property was built in 1995 and it is unusual to be able to buy an apartment community built in the '1990s for less than $110,000 per unit, says Jeff Hawks, who handled the sale with fellow Grubb & Ellis broker Doug Andrews.
Apartment construction rose dramatically starting in about 1997, Hawks says, so institutional quality projects such as Calavera were built at a lower cost, he adds.
''We had interest in Calavera from every class of buyers,'' Hawks tells GlobeSt.com. ''We had institutional buyers, REITs and private buyers, such as Baron bid on it.''
The average monthly rent at Calavera is $925, or $1.08 per sf. Despite recent problems with telecommunications and high-tech companies nearby such as Level 3 and Sun Microsystems, the project sits only five minutes from the doorstep of the Interlocken Business Center, the premiere office park along the US 36 corridor.
''Most of the problems (with high-tech companies) surfaced after we had it under contract, but before we closed,'' Jeff McVehil, director of acquisitions for Baron Properties, tells GlobeSt.com. ''We did a considerable amount of market research into that before we became comfortable with buying it. We're long-term holders and we think this is a short-term problem.''
Berkshire Mortgage Finance of Boston provided financing for the purchase.
Baron Properties owns and operates about 3,000 units, most of them in the Denver area. But it also owns apartments in Colorado Springs and Austin, TX.
''We're trying to find a third city in the Southwest to enter, where we could buy five or so properties for enough of a critical mass for it to make sense for us,'' McVehil tells GlobeSt.com. ''But we haven't decided which city yet.''
Baron also is looking for more opportunities in Colorado.
''This is our backyard and the market we know best,'' he says.
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