The exterior of the office tower at 410 17th St. in downtown Denver. Many of its floors are vacant. (BusinessDen file)
Ownership of a downtown Denver office tower has transferred to the firm that bought the building’s loan earlier this year.
California-based Cress Capital assumed ownership of the 24-story building at 410 17th St. on Tuesday, the company confirmed.
Cress got ownership in an unorthodox fashion.
Instead of buying the 435,000-square-foot building from its previous owner — a joint venture between Steelwave and Rialto Capital — Cress purchased its loan, which was in foreclosure and being marketed for sale. That deal, which Cress did in partnership with the new Denver-based firm E2M Ventures, took place in late February.
The loan, backed by 410 17th St., was originally made in 2019 for $113 million. As of last July, when lender Ares Commercial Real Estate filed to foreclose, $96 million was still owed. Cress Managing Partner Tom Parnell declined to discuss what the firm paid, but other sources said Cress bought it for approximately $20 million. Ares declined to comment.
Cress then negotiated a deed-in-lieu of foreclosure with Steelwave and Rialto to take ownership this week, Parnell said.
The 24-story office tower at 410 17th St. in 2019. It has since been repainted gray. (BusinessDen file)
The firm got the tower at a massive discount. The structure’s previous owner paid $127.5 million for it in 2019.
Then, of course, the pandemic hit. But perhaps more critical was the loss of Brownstein Hyatt Farber Schreck, a marquee tenant that had operated in the building for about 40 years. The law firm moved to Block 162 at 675 15th St.
Parnell said the tower, known as The 410, is more than 70 percent vacant.
No drastic changes are planned. While firms that buy office buildings often invest in renovations in order to keep and attract tenants, Parnell said that The 410’s previous owners already refreshed the lobby and other common areas, brought in Little Owl Coffee and built out spec suites.
“We’re starting from that,” Parnell said. “The prior owners did a really great job.”
While the building hasn’t changed, the fact Cress paid less means it will take much less for the property to be a success financially.
“We’ll have a reset basis … That is a big differentiator,” Parnell said.
Parnell said The 410 is “one of, we think the best buildings in the Uptown/CBD market.” That area, the south end of downtown, has larger and older buildings, and has struggled more than the Union Station area.
“We are big believers in the CBD,” Parnell said. “We think the current mayor and his administration have made good steps to clean things up, make it safer … We are optimistic that there will be a recovery.”
Locally, Cress also owns the Union Tower office building at 165 S. Union Blvd. in Lakewood. It previously owned the Orchard Pointe office building at 8480 E. Orchard Road in Greenwood Village.
Read more: Troubled towers: Breaking down Denver’s distressed office properties
The exterior of the office tower at 410 17th St. in downtown Denver. Many of its floors are vacant. (BusinessDen file)
Ownership of a downtown Denver office tower has transferred to the firm that bought the building’s loan earlier this year.
California-based Cress Capital assumed ownership of the 24-story building at 410 17th St. on Tuesday, the company confirmed.
Cress got ownership in an unorthodox fashion.
Instead of buying the 435,000-square-foot building from its previous owner — a joint venture between Steelwave and Rialto Capital — Cress purchased its loan, which was in foreclosure and being marketed for sale. That deal, which Cress did in partnership with the new Denver-based firm E2M Ventures, took place in late February.
The loan, backed by 410 17th St., was originally made in 2019 for $113 million. As of last July, when lender Ares Commercial Real Estate filed to foreclose, $96 million was still owed. Cress Managing Partner Tom Parnell declined to discuss what the firm paid, but other sources said Cress bought it for approximately $20 million. Ares declined to comment.
Cress then negotiated a deed-in-lieu of foreclosure with Steelwave and Rialto to take ownership this week, Parnell said.
The 24-story office tower at 410 17th St. in 2019. It has since been repainted gray. (BusinessDen file)
The firm got the tower at a massive discount. The structure’s previous owner paid $127.5 million for it in 2019.
Then, of course, the pandemic hit. But perhaps more critical was the loss of Brownstein Hyatt Farber Schreck, a marquee tenant that had operated in the building for about 40 years. The law firm moved to Block 162 at 675 15th St.
Parnell said the tower, known as The 410, is more than 70 percent vacant.
No drastic changes are planned. While firms that buy office buildings often invest in renovations in order to keep and attract tenants, Parnell said that The 410’s previous owners already refreshed the lobby and other common areas, brought in Little Owl Coffee and built out spec suites.
“We’re starting from that,” Parnell said. “The prior owners did a really great job.”
While the building hasn’t changed, the fact Cress paid less means it will take much less for the property to be a success financially.
“We’ll have a reset basis … That is a big differentiator,” Parnell said.
Parnell said The 410 is “one of, we think the best buildings in the Uptown/CBD market.” That area, the south end of downtown, has larger and older buildings, and has struggled more than the Union Station area.
“We are big believers in the CBD,” Parnell said. “We think the current mayor and his administration have made good steps to clean things up, make it safer … We are optimistic that there will be a recovery.”
Locally, Cress also owns the Union Tower office building at 165 S. Union Blvd. in Lakewood. It previously owned the Orchard Pointe office building at 8480 E. Orchard Road in Greenwood Village.
Read more: Troubled towers: Breaking down Denver’s distressed office properties
