Greenwood Village based NexGen Properties, LLC (NexGen) today announces it has closed on the sale of Shaffer Tech Center located at 7910Shaffer Parkway, in Littleton, CO 80127 for $14,500,000 ($144.21 psf) to CODI Manufacturing (CODI). NexGen acquired the 100,550 square foot industrial building just over a year ago on February 13, 2020 for $7,812,000 ($77.69 psf).TJ Smith and Nick Rice of Colliers International brokered the transaction on behalf of NexGen and CODI.

Shaffer Tech Center was built in 2002 and served as the home of Apria Healthcare for 15 years. The building features a 24’ clear height, 13dock-high doors with 4 levelers, 1 drive-in door, an ESFR fire sprinkler system, and a strong parking ratio of 2.9:1,000 sf. Upon acquisition of the building, NexGen completed the following improvements to the building: new 60mil TPO roof, new contemporary exterior paint, significant interior and HVAC demo, new dock-high and drive-in doors, exterior LED lighting, asphalt repair and resurfacing, and refreshed landscaping. The improvements brought new life into what was an overlooked property in the affluent Southwest Denver suburb of Ken Caryl, which benefits from impressive demographics, a constrained supply of Class A industrial buildings, close proximity to nearby rooftops, and immediate access to the C-470, I-70, and I-285 mountain corridors.

CODI, a manufacturer of craft beverage canning systems, intends to occupy 100% of Shaffer Tech Center. As the only option in Southwest Denver for industrial users with a 100,000 square foot requirement, the building provided CODI with an opportunity to purchase a Class A industrial property at a slight discount to replacement cost without the time required to build. The pandemic increased demand for CODI’s products, resulting in the immediate need to relocate from a smaller facility in Golden, CO.

“Our original business plan was to multi-tenant the building for lease to two or three tenants and hold the asset for cash flow; however, the pandemic significantly accelerated owner/user demand resulting in a price we simply could not refuse,” said Matt Bernstein, Director of Acquisitions and Asset Management at NexGen. “CODI was able to leverage the SBA CDC/504 loan program to obtain favorable manufacturer pricing to acquire the building. It was extremely fun to see capitalism at work and know that CODI will bring new jobs to Ken Caryl. They bought a great building, and one we are sad to see eliminated from the portfolio.”

NexGen partnered with TJ Smith and Nick Rice of Colliers International to provide leasing services for the building, but they suggested NexGen remain open the sale. “We always believed in the NexGen business plan as they had such a great buy at a competitive basis,” said TJ Smith. “Although it was about a year ago, in today’s market you would be hard pressed to find a Class A industrial building for under $80 psf. We had strong interest from many tenants, but ultimately determined NexGen would extract the most value out of a user sale. NexGen displayed their organizational flexibility by changing the business plan and executing efficiently. It was a competitive bidding process between multiple buyers and CODI ultimately emerged as the building fits their needs perfectly. Congratulations to NexGen on a great transaction, and I wish CODI luck in their new facility.”

“Commercial real estate investing can be very challenging with plenty of risk, but at times the market works in your favor,” said Travis McNeil, President of NexGen. “Ultimately, selling Shaffer Tech Center was a market driven decision, that we could not pass up. It afforded NexGen an opportunity to eliminate its carry costs, leasing risk, and significant additional capital investment required to stabilize the building in the form of demising costs, new HVAC equipment, office/restroom buildouts, and additional drive-in doors. While there are benefits in our industry of holding real estate for the long term, the pandemic presented NexGen with an opportunity to realize a sizable return in a short period of time. It was rewarding to witness NexGen’s mission at work; to leverage our real estate expertise, industry knowledge and management capabilities, to identify, invest, modernize, and create value in undervalued or underperforming properties and development opportunities, that benefit our local communities.”