Mesa West Capital provided a joint venture of Miller Global Properties and Principal Real Estate Investors with $59.3 million in first mortgage debt for the acquisition of a 306,101-square-foot Class A office building in Denver, CO.
The floating-rate non-recourse loan is secured by 4600 S. Syracuse, a 13-story office building and adjacent five-story parking garage located within the Denver Technological Center (DTC), an 850-acre master planned business district12 miles southeast of downtown Denver. Building amenities include a community conference room, training and fitness center, and on-site deli.
The Denver financing follows a recent $58.7 million loan originated by Mesa West Capital for the acquisition of a commercial office building in California’s Silicon Valley.
“While the office sector continues to face headwinds caused by the pandemic, there will always be a flight to top quality real estate and our two recent financings reflect that,” said Josh Westerberg, a Director in Mesa West Capital’s San Francisco office who along with Principal Ronnie Gul, originated the financing. “We will continue to take a conservative view towards office in the near term, but that said, we will look at opportunities to finance well-located Class A office with strong sponsorship as in the case of 4600 S. Syracuse”.
The DTC is one of Denver’s most desirable submarkets having historically experienced a disproportionately high amount of demand relative to the greater market. The planned improvements by the sponsor will only increase the presence and appeal of the property for both existing and prospective tenants, according to Westerberg.
The sponsor will undertake multimillion capital improvement program that is expected to include a covered walkway connecting the office tower to the adjacent parking structure, lobby renovation, common corridor upgrades, and the addition of an outdoor amenity space.
The financing was arranged by Eric Tupler and Josh Simon with Jones Lang LaSalle out of the firm’s Denver office.