Colorado Real Estate Journal–Bancroft Capital upped its investment in Highlands Ranch with the acquisition of the 137,316-square-foot Ridgeline Technology Center.
Bancroft paid “north of $21 million” for the three-building Class A office property in a deal that comes on the heels of another acquisition in Highlands Ranch in April.
“We’ve invested in Colorado since 1994 and look for neighborhoods and communities where there is significant growth and high quality of life. Highlands Ranch, in particular with the livability scale. has been one of the best places to live in the country for a number of years,” said Doug McDonald, a principal with Newport Beach, California-based Bancroft Capital.
Ridgeline Technology Center, located at 9135, 9137 and 9139 S. Ridgeline Blvd., is anchored by ADA-ES, an environmental services company, Children’s Hospital Colorado and Kaiser Foundation. It’s close to the nearly $315 million UCHealth hospital campus, which will open in 2018. Around 50 percent of the tenants are health care-related, which bolsters the appeal and strength of the rent roll, said CBRE Executive Vice President Geoff Baukol.
But Ridgeline also has tenants in insurance, finance and other industries, making for a diverse roster that appealed to Bancroft. “It’s basically a snapshot of the Colorado economy on a smaller scale,” McDonald said.
Stoltz Real Estate Partners, which had owned Ridgeline just shy of two years, was the seller.
Ridgeline Technology center is next to Highlands Ranch Town Center, which gives it a distinct advantage, according to Baukol, who represented the seller.
“This property sets itself apart from its competitors with its visibility off of Highlands Ranch Parkway and a plethora of walkable retail amenities,” he said. “I think some of the health care tenants are attracted to it because of that access and visibility, and proximate amenities. It’s a big driver for this property.”
In addition, “Properties down there have been doing very well,” he said. Ridgeline Technology Center was 96 percent occupied at the time of the sale. That’s in line with other Class A office buildings in the southwest submarket, whose 3.7 percent vacancy rate is lower than either the downtown or southeast suburban submarkets.
The two-story buildings, which provide 4.3 parking spaces per 1,000 sf, were built in 2001.
“The quality of the property and the management is spectacular,” McDonald said. “The prior owners were the most professional people we’ve worked with in 30 years, and Geoff Baukol, who worked on the transaction, was fantastic.”
Bancroft Capital, which owns about 800,000 sf in the Denver metro area, bought the nearby, 152,208-sf Highlands Ranch I and II for $25.1 million last spring. It likes Highlands Ranch because it’s a newer, diverse community that is attracting both residents and employers, said McDonald, adding Bancroft Capital continues to feel good about the broader Denver market.
“We’re happy to increase our ownership concentration in a market that we feel very strongly about and has extremely positive trends,” he said.