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BKM Capital Partners Spends $14.75 Mil on Denver Distribution Complex

BKM Capital Partners has acquired Crossroads Distribution Center, a 14-unit industrial asset consisting of three single-story distribution warehouse buildings totaling 150.2k sf in the Central East I-70/Montbello submarket of Denver, CO. The property, located at 3700 Havana St, fetched $14.75 mil ($98/sf).

Originally constructed in 1973, Crossroads Distribution Center is 90% leased to 12 tenants and features a mix of grade level, full-dock, and half-dock loading. The firm plans to rebrand the asset as Havana 37 Business Center and will invest approximately $1.2 mil in capital improvements to upgrade the roof, HVAC system, and parking lot. Crossroads Distribution Center is strategically located off I-70, 25 minutes from Denver’s Downtown business district, offering easy access to the Denver airport, I-70, I-25, Downtown Denver, and Denver Tech Center. It was sold by KEW Realty, a private local seller, in an off-market transaction. “This was a rare opportunity to acquire a well-occupied industrial business park, strategically located in the most desirable and one of the fastest-growing industrial submarkets of Denver,” says BKM Capital Partners Managing Director of Acquisitions, Brett Turner. “Vacancy in the Central East I-70/Montbello submarket is 2.4%, with no new deliveries scheduled that will compete in unit size to Crossroads Distribution Center, making this area and property ideal for our portfolio.” The Central East I-70/Montbello submarket has seen average rent growth of greater than 8% for the last six years. Planned infrastructure improvements to this region over the next few years – including the Central 70 Project, which will reconstruct a 10-mile stretch of I-70 and add new express lanes to this major roadway – will serve to improve the submarket’s desirability among industrial tenants for years to come. The property offers BKM a unique opportunity to purchase an asset in a path of growth, with minimal competition; while 53% of all new industrial construction in the Denver market is occurring in the Airport submarket in which the property is situated, this development is focused on large-scale big-box distribution, which will not compete directly with Crossroads Business Center, Turner notes. Further master-planned developments in the region include the expansion of the Bioscience campus at Fitzsimons Army Medical Center, the Aerotropolis, and the Denver International Airport. “This was an off-market transaction that resulted in a price agreement at a significant discount to replacement cost,” Turner explains. “The acquisition price of $98 per square foot is a 13% discount to recent transactions in this submarket and a 43% discount to the asking price for a nearby comparable property.” BKM represented itself in the off-market acquisition. The seller, KEW Realty, also represented itself.

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Headquartered in Newport Beach, California, BKM Capital Partners is a real estate fund manager specializing in the acquisition and improvement of value-add multi-tenant industrial properties in metro areas across the Western U.S. Combining a deep knowledge of this niche industrial product type with in-house capabilities including on-site property management, asset management, and leasing to reposition and institutionalize light industrial assets, the firm continues to build on its proven track record, generating strong results with high levels of transparency and engagement for investors. 

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BKM Management Company manages a portfolio of 8.6 million square feet of multi-tenant industrial properties for BKM Capital Partner’s private and institutional investors. With a focus on “boots on the ground” execution at the property level, BKM has in-house capabilities for both property management and leasing. The teams at the property level are focused on ensuring the tenants thrive and that the properties are managed in the most efficient way.




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