Neiman has been tracking the local real estate market for more than 20 years. His study includes offices, retail centers, and industrial properties that sold for a minimum of $1 million each. His study doesn't include apartments or land sites.
Despite the increase from last year, the market is not on fire, Neiman says. Rather, institutional investors are seeking out buildings with single, creditworthy tenants and grocery anchored retail centers, a trend occurring across the country.
The two top sales so far this year, the Invesco campus and the VISA building, are prime examples of this trend. Both fetched top dollar, with Invesco at $57.75 million and VISA at $52.6 million.
Byron Koste, who heads the CU Real Estate Center at the University of Colorado Leeds School of Business in Boulder, tells GlobeSt.com that there is another trend going on as well. In this tough market, some owners are forced to dump their properties at fire sale prices, either to deploy cash elsewhere, or because they don't have the staying power.
For example, earlier this year Level 3 in Broomfield sold three buildings and 55 acres for $14 million, or about $40 per sf. Level 3 invested an estimated $150 to $160 per sf in the Class A buildings that it never occupied.
The two extremes--the sought after single-tenant and retail centers and the fire sale buildings--account for the increase in dollar volume, Koste says. "It's not a sign we should go out and start building again," Koste tells GlobeSt.com.
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