BKM Capital Partners has recently acquired the West 6th Center in Denver for $10.75 million and plans to invest an additional $7 million to modernize the 122,783-square-foot small-bay industrial building. According to BKM’s Brett Turner, this deal presents a unique opportunity as it was secured at a significant discount of 63% below replacement cost.
The firm intends to take advantage of the property’s short-term leases averaging at just 1.5 years by addressing a mark-to-market deficiency in rents which currently stands at 53%. The building is currently occupied by three tenants.
As part of their strategy, half of the capital investment will be allocated towards dividing and renovating one large unit into four smaller ones within six months of ownership. This will increase the total number of industrial units from two to six and bring down average unit size from approximately 40,928 square feet to around20,464 square feet.
The acquisition was made through a joint venture partnership between BKM Capital Partners and TerraCore Capital.
This article titled “BKM Sees Gold in Denver Value-Add Industrial Asset” discusses BKM Capital Partner’s recent acquisition strategy for West Sixth Center in Denver worth $10.75 million with plans for extensive renovations totaling up tp$7million.The property boasts an impressive area spanning over122k sq.ft.and is expectedto witnessa major facelift under new management.Brett Turner,the spokespersonfor BKMCapitalPartnersexpressed his enthusiasm stating thatthe company managedto securethis assetat an incredible discountof63%below its replacementcost.This moveis consideredstrategicasit allowsBKMCapitalPartners totake advantageofshort-termleaseswithanaveragelease termsof only1 .5yearsandcorrect amark-to-marketdeficiencyinrentsby53%.Withplans todemiseand rehabilitate69k sq.ft.of spacewithinthe firstsix monthsof ownership,the propertywill see a significant increasein the numberof industrialunitsfromtwo to six,withan averageunit size of20k sq.ft. This acquisitionwas made possiblethrougha joint venturepartnershipbetween BKMCapitalPartners andTerraCoreCapital.
