The Waterview III building at 8000 S. Chester St., one of three buildings that make up the Campus at Waterview office complex. (Courtesy Lincoln Property Co.)
The firm that’s bought more local office buildings on the cheap than anyone just scooped up another three.
Glendale-based Westside Investment Partners, led by Andy Klein, paid $27 million last week for the Campus at Waterview complex in Centennial, according to public records.
The complex is made up of three buildings just west of the IKEA along Interstate 25, at 8000 and 8005 S. Chester St. and 9155 E. Nichols Ave. They total nearly 366,000 square feet, making the deal worth about $73 a square foot.
The property was sold by an entity affiliated with investment management firm Barings, which purchased the complex in August 2014 for $66.85 million, records show. At the time, it was 91 percent leased.
Westside paid 60 percent less than the 2014 sale price. And Klein figures he paid 15 percent of replacement cost, or what it would cost today to build what’s already there.
Andy Klein
“Under 20 percent of replacement cost and double-digit cap rates is typically what we are looking for in suburban markets,” Klein said.
Collectively, the buildings are 81 percent occupied, Klein said. One 100,000-square-foot structure is fully leased to software firm Ring Central. The others have some vacancy and aren’t dominated by a single tenant. The weighted average lease term for the complex, which measures how much time is left on a property’s various leases, is more than four years, Klein said.
Westside will do about $4 million in renovations. Two buildings sit on a pond, so the firm will aim to make that outdoor space more inviting, Klein said. Lobbies will be spruced up, furniture and other fixtures will be updated and shared amenities will be improved.
Andrew Piepgras and Peter Thomas of Lincoln Property Co. will continue to market the property for lease.
“They’re doing a fantastic job,” Klein said. “We signed three leases since we went under contract.”
Westside financed the purchase with a $28 million loan from an affiliate of Missouri-based RGA Reinsurance Group of America. That loan has annual interest of 7.5 percent and is set to mature in November 2027, with two one-year extensions possible, according to the agreement recorded by Arapahoe County.
Westside has been the biggest player buying Denver-area office buildings since the value of many structures cratered with the pandemic.
“Office has such a taint, such a negative connotation, in the market that it’s hard to capitalize, both debt and equity … Our investment philosophy is to buy assets that other people don’t want,” Klein said. “That dearth of financing is what allows you to make good buys.”
Klein is financing his buys in part with funds from wealthy individual investors — a majority of whom are local, he said.
Westside bought downtown’s Denver Club building in 2022 and a vacant structure on the other side of I-25 in Centennial in 2023. Earlier this year, the firm bought three adjacent structures in Greenwood Village across two deals with Denver-based Knightbridge Capital.
Westside isn’t alone in trying to land these deals — Koelbel & Co. is another local firm that’s made multiple buys — but Klein said he doesn’t know of any out-of-state firms currently on the hunt for cheap Denver office space. It’s surprising, he said, how little competition there is.
“The good news is, there’s enough opportunities for all of us.”
The Waterview III building at 8000 S. Chester St., one of three buildings that make up the Campus at Waterview office complex. (Courtesy Lincoln Property Co.)
The firm that’s bought more local office buildings on the cheap than anyone just scooped up another three.
Glendale-based Westside Investment Partners, led by Andy Klein, paid $27 million last week for the Campus at Waterview complex in Centennial, according to public records.
The complex is made up of three buildings just west of the IKEA along Interstate 25, at 8000 and 8005 S. Chester St. and 9155 E. Nichols Ave. They total nearly 366,000 square feet, making the deal worth about $73 a square foot.
The property was sold by an entity affiliated with investment management firm Barings, which purchased the complex in August 2014 for $66.85 million, records show. At the time, it was 91 percent leased.
Westside paid 60 percent less than the 2014 sale price. And Klein figures he paid 15 percent of replacement cost, or what it would cost today to build what’s already there.
Andy Klein
“Under 20 percent of replacement cost and double-digit cap rates is typically what we are looking for in suburban markets,” Klein said.
Collectively, the buildings are 81 percent occupied, Klein said. One 100,000-square-foot structure is fully leased to software firm Ring Central. The others have some vacancy and aren’t dominated by a single tenant. The weighted average lease term for the complex, which measures how much time is left on a property’s various leases, is more than four years, Klein said.
Westside will do about $4 million in renovations. Two buildings sit on a pond, so the firm will aim to make that outdoor space more inviting, Klein said. Lobbies will be spruced up, furniture and other fixtures will be updated and shared amenities will be improved.
Andrew Piepgras and Peter Thomas of Lincoln Property Co. will continue to market the property for lease.
“They’re doing a fantastic job,” Klein said. “We signed three leases since we went under contract.”
Westside financed the purchase with a $28 million loan from an affiliate of Missouri-based RGA Reinsurance Group of America. That loan has annual interest of 7.5 percent and is set to mature in November 2027, with two one-year extensions possible, according to the agreement recorded by Arapahoe County.
Westside has been the biggest player buying Denver-area office buildings since the value of many structures cratered with the pandemic.
“Office has such a taint, such a negative connotation, in the market that it’s hard to capitalize, both debt and equity … Our investment philosophy is to buy assets that other people don’t want,” Klein said. “That dearth of financing is what allows you to make good buys.”
Klein is financing his buys in part with funds from wealthy individual investors — a majority of whom are local, he said.
Westside bought downtown’s Denver Club building in 2022 and a vacant structure on the other side of I-25 in Centennial in 2023. Earlier this year, the firm bought three adjacent structures in Greenwood Village across two deals with Denver-based Knightbridge Capital.
Westside isn’t alone in trying to land these deals — Koelbel & Co. is another local firm that’s made multiple buys — but Klein said he doesn’t know of any out-of-state firms currently on the hunt for cheap Denver office space. It’s surprising, he said, how little competition there is.
“The good news is, there’s enough opportunities for all of us.”
