Inland Enters Denver Market with Retail Property Purchase
- Jan 21, 2015
Inland American Real Estate Trust knows a winning asset when it sees one–and it saw just that in Denver’s Quebec Square.
The non-traded REIT has bought the 207, 561-square-foot shopping center in Denver for $52.25 million, it’s very first purchase in Colorado’s capital, according to Christopher Covey, senior vice president of transactions for Inland American.
“It is the dominant necessity-based retail property in this high-barrier-to entry infill location,” Covey told Commercial Property Executive. “(The center) contains a solid national and regional tenant line-up … (it) matches our long-term strategy of investing in multi-tenant, necessity-based retail properties. We believe it is well positioned for growth.”
Quebec Square is 97 percent occupied by tenants such as PetSmart, Ross Dress for Less, Office Depot and Party City, among others. The property is shadow-anchored by a Walmart and Sam’s Club, neither of which was acquired. The shopping center is the primary retail destination for the area at a highly-traveled intersection with a population of 100,000 within a three-mile radious, according to the news release.
“We view this as a stepping stone to additional opportunities in the Denver MSA going forward,” Covey added.
Inland American also owns retail assets in Greeley and Colorado Springs, Colorado.
Lee & Associates arranged the sale of Quebec Square on behalf of a private equity trust, along with Jan Fincham and Patrick Dempsey, principals at Phoenix Lee & Associates.
As the economy in the Denver metro area continues to rise, retailers are expanding their footprints, which is improving operations and lifting retail rents, according to a 3Q2014 Retail Research Market Overview by Marcus & Millichap.
“In these areas, high-net-worth investors are seeking assets near transit hubs that provide a live-work-play lifestyle. Cap rates for these deals are in the high-6 percent range,” per report.