Dealmaker: Northstar Commercial Partners Sells Colorado Office for $35M

Northstar Commercial Partners, Denver, sold office property 860 Potomac in Aurora, Colo., for $34.7 million.

Northstar acquired the 113,500-square-foot building vacant in 2017 for $5.6 million. Company Chairman and CEO Brian Watson noted his firm stabilized the asset with a long-term lease prior to listing the property for sale, providing the firm’s equity investors with a more than three-fold multiple on their original investment in just over 18 months.

Children’s Hospital of Colorado agreed to lease the entire building in May. Vector Property Services President Matt Smith and Northstar Commercial Partners Brokerage Director Gabe Uhrig represented the ownership in that deal; Colliers International Robert Whittelsey Principal represented Children’s Hospital.

Chris Bodnar, Lee Asher, Shane Seitz, Ryan Lindsley and Sabrina Solomiany of CBRE U.S. Healthcare Capital Markets worked with James Brady and Campbell Davis from CBRE Denver Investment Properties to advise Northstar on the sales transaction. The Denver Business Journal reported Harrison Street Capital, Chicago, purchased the property.

“Even though the renovation of the building will not be completed until mid-2019, investors were able to price through any construction risk and focus on the opportunity to control an asset that will be fully occupied by one of the top 10 pediatric hospitals in the nation,” Bodnar said.

The four-story medical office building was constructed in 1984 and expanded in 1992. It sits just east of Denver on Interstate 225, less than a mile from Aurora’s Fitzsimons Medical Campus, where more than $5 billion has been invested in facilities for the University of Colorado, Department of Veterans Affairs, Children’s Hospital and others.

Children’s Hospital’s lease will commence on June 1, 2019.