Embattled real estate investor’s southeast Denver shopping center sells for $24M

The bulk of the Happy Canyon Shopping Center sold for $24.2 million. (Photos by Marcus & Millichap)

The receiver unloading the assets of an embattled Cherry Hills Village real estate investor has struck his first deal.

Golden-based BPI Inc. purchased much of the Happy Canyon Shopping Center along East Hampden Avenue in southeast Denver last week for $24.2 million, or $342 per square foot, according to county records.

Bradley Calkins Jr., whose family sold its Bradley Petroleum gas station chain in 2017, signed the paperwork as the buyer.

The shopping center is the first property to be sold by Harvey Sender, who was appointed in August to oversee the assets of Gary Dragul, who is facing 14 counts of securities fraud. The sale proceeds will go towards the receivership estate and help pay back some investor claimants.

Jake Shirek

Cory Gross

Brokers Jake Shirek and Cory Gross of Marcus & Millichap are marketing all the properties in the Dragul receivership portfolio, which includes properties both in the Denver area and out of state.

“The Dragul case has been in the spotlight for a long time now and I think the tenants of the center will be happy to know that the property is in stable hands now,” Gross said in a statement. “The new owner lives within the community a stone’s throw from the property and will hold this asset for the long term.”

The pair said the sale included 4820, 4992, 4996 and 5074 E. Hampden Ave., a portion of the shopping center that is 95 percent leased and home to a number of businesses, including Orangetheory Fitness, CorePower Yoga and Starbucks. The deal included a building at the corner used by Dunkin’ Donuts, and a freestanding former Burger King that the brokers said the buyer likely would redevelop.

Businesses in the shopping center include Starbucks and Corepower Yoga.

The sale did not include the site occupied by 7-Eleven, or a large vacant building in the middle of the complex that previously was home to grocery store Safeway. Plans to convert the Safeway into a food hall became public in late 2017, when specialty grocer Tony’s Meats and Market closed its location along Broadway and said it would be a tenant in the space.

Things became murkier when Dragul was indicted last spring, and renovation of the building slowed to a halt. Shirek said the Safeway building is not part of the receivership portfolio because a number of other investors owned stakes in the property alongside Dragul.

Shirek said he believes BPI is interested in purchasing the Safeway building from those parties and moving forward with the food hall concept. He’s not directly involved in those negotiations. Shirek said at this point, Tony’s Market is the only confirmed tenant for the food hall.

The sale did not include the former Safeway building, which has been discussed as as the site of a future food hall.

“There were a lot of tenants that had signed leases, but they had outs in the leases due to construction not being complete,” he said.

The three other local properties in the receivership portfolio that Shirek and Gross are marketing are:

Summit Marketplace: A 14,000-square-foot retail strip at 385 Crossing Drive in Lafayette, listed at $4.79 million. A King Soopers anchors the broader shopping center.

Ash & Bellaire at Warren townhome development site: The 1-acre site, listed at $2.9 million, has six single-family homes on it, but could support a 27-townhome development.

Former Village Inn: The 4,800-square-foot building at 5290 E. Arapahoe Road in Centennial, listed for $1.2 million, previously housed the chain restaurant, but is currently vacant.

The portfolio also includes multiple properties out of state, including a shopping center in Clearwater, Florida, which is under contract for $17.1 million, and a shopping center in Hickory, North Carolina, that is under contract for $13.6 million.

Dragul recently put his mansion in Cherry Hills Village on the market for $6.95 million. Two liquor stores controlled by he and his wife, in Aurora and Englewood, have closed in the last year.

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