A prime piece of Downtown Denver real estate has been sold to New York and Chicago institutional investors for $33.2 million.
The property, including the stately, white marble Colorado National bank at 17th and Champa streets, was purchased by a unit of Wall Street investment Donaldson Lufkin & Jenrette and Chicago real-estate firm LaSalle Partners.
In addition to the 64-year old bank, the transaction includes the newer, 26-story Colorado National office tower at 17th and Curtis streets, and a one-acre parking lot along the 16th Street Mall. “The buyers believe Downtown is making its move and there’s quite a bit of opportunity,” said Nathan Johnson, A Frederick Ross Co. broker who negotiated the sale. Downtown analysts said the transaction is perhaps more notable for the property’s future than its current state. The parking lot on 16th Street is considered a key, strategic developable parcel that could change the face of the mall.
“We’ d love to see something happen there,” said Bill Mosher, president of the Downtown Denver Partnership. “Vacant space and parking lots on the mall are a killer. That (parking lot) is a pretty big tooth out of the smile on the mall.” Officials of both DLJ and LaSalle said there are no plans for developing the parking lot.” Ultimately we’ d like to see some development on that site but there are no immediate plans,” said Jim Hutchinson, a principal at LaSalle Advisers, an investment management unit of LaSalle Partners. Hutchinson said the parcel eventually could be built out as offices, retail space or residential units. Broker Phil Ruschmeyer of Frederick Ross said the buyers will spend about $10 million renovating the existing office tower’s exterior, lobby, elevators and common-area space. Upon completion of the remodeling, he said, the building will be the only property on 17th Street with high-quality, upper floor office space with unobstructed views.
Colorado National Bank, the seller of the block, will lease back the entire six-story bank building and several floors in the office tower. CNB is owned by Minneapolis-based First Bank System Inc. ”We’re just not in the business of owning real estate,” said Donn Waage, senior vice president of corporate relations for CNB. “This will allow us to focus on the banking business .”