DENVER–During a recent panel discussion of investment specialists at RealShare Greater Denver, deals that are in the works and whether capital is available to get these deals done were analyzed. The discussion was moderated by Brad Cohen, managing director, capital markets, Transwestern, with these experts on hand: Geoff Davis, president and senior principal, HREC Investment Advisors; Phillip Gause, director, Marcus & Millichap Capital Corporation; Peter Keepper, managing principal, Essex Financial Group; Eric Johnson, vice president, commercial real estate, Colorado Business Bank; and Laurie Lyons, partner, Cardinal Group Management.
The panel discussion centered on investor interest, with further extension into Class B and suburban product. Institutional and private investors have taken note of Denver's economic growth, with a particular interest in office assets.
Keepper said, “Foreign interest is apparent in the top 10 markets and I don't see that changing much. Our strong population, employment growth, walkable jobs and diverse economy, combined with an attractive place to live means people will continue to want to be in Denver.”
Davis agreed, saying, “Chinese investors are still active in US markets, which is resulting in an increased cost of capital, with good value-add in many growth markets.” Lyons added that Canadian investors are active in multifamily.
As for property types, Johnson listed build-to-suit industrial, office infill, mixed-use retail/office and smaller suburban retail as hot ticket items for loans. Some of the hot areas include both the Denver Tech Center and Northwest suburban markets, which are experiencing increased activity and new construction. Google is expanding its footprint in Boulder with a new corporate campus, with many a local and national firm having interest in creating or expanding corporate presence in Greater Denver. Grause pointed to $1.1 billion invested in Colorado last year as case in point, specifically calling out Denver for 1031 exchange equity placement.
“The market is hotter than in 2007; basically, people are doing what it takes if there is any way to be here,” said Lyons.
For final thoughts, some of the risk factors for Denver real estate investments were mentioned, such as over exuberance of pricing, housing affordability and wage growth.
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Lisa Brown
Lisa Brown is an editor for the south and west regions of GlobeSt.com. She has 25-plus years of real estate experience, with a regional PR role at Grubb & Ellis and a national communications position at MMI. Brown also spent 10 years as executive director at NAIOP San Francisco Bay Area chapter, where she led the organization to achieving its first national award honors and recognition on Capitol Hill. She has written extensively on commercial real estate topics and edited numerous pieces on the subject.
