Equus Pays $11M-Plus for Office Building As Part of $150M Plan

Tech Center VI is the fourth Colorado property acquired by Equus in the past nine months and is part of the firm's plan to invest more than $150 million in commercial real estate in Colorado throughout the next 12 months.

Built in 1986, Tech Center VI is a three-story office building of 104,439 sf, which translates into a sales price of $108.20 per sf. It is at 5575 Tech Center Dr. The property is part of a 107-acre master-planned business park in the Interstate 25 North submarket and recently underwent extensive exterior building and lobby renovations. The property was acquired at 84% occupancy with a diverse profile of credit tenants.

"We have made a great addition to our Colorado portfolio," says Equus chief investment officer Jeff Schindler. "Tech Center VI is a well maintained asset with strong tenants and nice upside potential, which is becoming difficult to find in today's investment market. In addition, we are confident the Colorado Springs and more specifically the I-25 North submarket will continue to perform well in terms of space absorption and increasing values."

In September 2004, Equus acquired Tech Center I and Pikes Peak Research Center, which are both also in Colorado Springs. Since its acquisition, Tech Center I occupancy has increased from 57% to 72%, with additional leases in negotiation that would bring occupancy to 80%. Pikes Peak occupancy has increased from 53% to 64% with additional leases in negotiation that would take occupancy to 74%.

"In the past few months there has been a marked improvement in demand for office space in Colorado Springs," says Roger Simsiman, Equus chief operating officer. "We expect the improving economy and recent military base realignments will result in a significantly reduced vacancy rate and higher rental rates over the next two years." Equus will open a Colorado office later this year to provide asset management services to its growing portfolio of investment property in Colorado.

Based in La Jolla, California and Phoenix, Arizona, Equus sources, acquires, improves, repositions, leases, manages, operates and sells commercial real estate on behalf of Equus Realty Funds, which intends to invest over $1 billion in the US throughout the next three years.