piñon valley industrial park office flex portfolio for...

4980 Centennial Boulevard 5010 Centennial Boulevard 5030 Centennial Boulevard

Piñon Valley Industrial ParkOffice Flex Portfolio for SaleThree separate buildings on Centennial BoulevardColorado Springs, Colorado

OFFERING MEMORANDUM

I. Executive Summary

The Offering

As exclusive sales agents, Jones Lang LaSalle and Grubb & Ellis in Colorado Springs are pleased to offer for sale three (3) buildings collectively known as the Piñon Valley Industrial Park Portfolio, “the Properties,” in Colorado Springs, Colorado. Ideally situated in Colorado Springs’, Garden of the Gods Submarket, the Properties’ excellent location fronting Centennial Boulevard provides highly flexible space to meet a multitude of tenant requirements. Neighboring buildings are home to such businesses as; Hewlett-Packard, Verizon, Intel, Kaman Sciences, Agilent Technologies, ITT Technologies, LSI Logic, Wells Fargo, Entegris, Safetrain, Xircom, Aeroflex, Tuscarora, Velcon Filters, Eagle Electronics, The Navigators World Headquarters, etc.

Piñon Valley Industrial Park Portfolio — Property Highlights4980 Centennial Boulevard 5010 Centennial Boulevard 5030 Centennial Boulevard

Price $1,210,000 ($50.00 / s.f.) $2,800,000 ($81.87 / s.f.) $1,420,800 ($40.00 / s.f.)

In Place NOI N / A $267,156 N / A

Capitalization Rate N / A 9.54% N / A

Year Built 1979 1983 1987

Rentable Square Feet 24,200 s.f. 34,200 s.f. 35,520 s.f.

Stories 1 1 1

Leased 0% 100% 0%

Lot Size 2.02 acres 2.16 acres 2.415 acres

Ceiling Height 15’0” - 16’0” 14’0” - 16’0” 14’0” - 16’0”

Parking Ratio 2.71 : 1,000 s.f. 2.34 : 1,000 s.f. 2.39 : 1,000 s.f.

Sale Specifics

Each building offers unique characteristics which set it apart from the competition; above standard power, abundant parking, flexible floorplates, Centennial Boulevard frontage and access, etc. The buildings can be purchased individually or as a package and offer excellent opportunities for individual building sales to users or as an investment sale with a long term credit tenant in place and a value add component.

W. GARDEN OF THE GODS RD.

N. 30T

H ST. CENTENNIAL BLVD.

FOR

GE

RD

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N. C

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ST

NU

T S

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Piñon Valley Industrial Park — Demographics1 Mile 3 Miles 5 Miles

Population 7,086 47,869 131,363

Total Households 2,794 19,643 54,867

Number of Employees (Full Time) 4,804 32,454 82,054

Number of Establishments 270 1,917 5,748

Average Age 39 40 39

Average Household Income $91,922 $84,368 $74,117

Piñon Valley Industrial Park — Traffic CountsStreet Cross Street Traffic Count Distance

Centennial Boulevard List Drive 20,612 0.29 miles

North 30th Street Boardwalk Street 8,042 0.36 miles

Centennial Boulevard West Garden of the Gods Road 21,000 0.50 miles

West Garden of the Gods Road I-25 50,587 1.47 miles

Demographics

II. Tenancy / Lease Overview

Rent Roll4980 Centennial Boulevard - Rent Roll

Suite Tenant Rentable SF Lease Commencement Lease Expiration Current

Annualized Rent

Current Annualized Rent PSF

Rent Step Dates Rent PSF / Year Annual Rent

100 Vacant 24,200 - - - - - - -

5010 Centennial Boulevard - Rent Roll


Annualized Rent



100 Federal Express 34,200 s.f. *1/1/10 12/31/14 $271,206 $7.93 flat $7.93 $271,206

5030 Centennial Boulevard - Rent Roll


Annualized Rent



100 Vacant 35,520 - - - - - - -

* Initial date of occupancy was 10/1/1984

III. Market Overview

Colorado Springs

Colorado Springs is located 61 miles south of Denver at the base of Pikes Peak. The city is 186 square miles making it Colorado’s largest. And, with a population of 380,307, Colorado Springs is Colorado’s second most populous city.

The Colorado Spring Metropolitan Area (CSMA) encompasses El Paso County and Teller County— an area comprised of 2,689 square miles with a population of 617,714. During the past seven decades, the area has sustained a steady and impressive rate of growth. The largest increase of 93 percent occurred between 1950 and 1960 coincidental with the establishment of the North American Air Defense Command (NORAD) and the United States Air Force Academy. Since 2000, The CSMA has realized an average annualized population growth rate of 1.7 percent.

The economy in the area is driven by the military, high-tech industries, aerospace, and tourism. There are five military installations: Fort Carson, Peterson Air Force Base, Schriever Air Force Base, NORAD and Cheyenne Mountain Air Station, and the United States Air Force Academy. The military employs one fifth of the work force while infusing almost $2.6 billion into the local economy every year.

Additionally, Colorado Springs has five school districts with over 145 elementary, middle, and high schools. And, there are more than 20 colleges and universities and 30 vocational two-year schools in the area.

The city was named America’s Best city by Outside Magazine in 2009. Colorado Springs was originally founded in 1871 as a high quality resort city. It has since maintained a large tourism industry due to the world-class accommodations, scenery, and lifestyle. Some of the more popular sightseeing destinations are the Garden of the Gods, Pikes Peak (America’s Mountain), Pikes Peak Cog Railway, the United States Olympic Headquarters, and Cheyenne Mountain Zoo.

Colorado Springs is also home to the world-renowned Broadmoor Hotel. Founded as a casino, it has become one of the finest resorts along the Rocky Mountains with a mobile five-star and AAA five-diamond resort rating. It employs nearly 2,000 people from all over the world and draws thousands of visitors every year. Additionally, the Broadmoor’s tennis facilities are ranked #3 by Tennis Magazine.

Airforce Academy

Cheyenne Mountain Zoo

Broadmoor Hotel

Colorado Springs Submarket Map

U n i t e d S t a t e sA i r F o r c eA c a d e m y

C o l o r a d o S p r i n g sM u n i c i p a l

A i r p o r t

Cheyenne MountainAir Force Base

PetersonAir Force

Base

F o r t C a r s o n

N Powers Blvd

Interquest Pky

S Ne

vada

Ave

E Platte AveMidland ExpyW Cimarron St

S Ac

adem

y Blvd

N Po

wers

Blvd

N Ac

adem

y Blvd

E F o untain Blvd

E Uintah St

Drennan Rd

Vindic ator Dr

Main St

E Pikes Peak Ave

E Fillmore St

Galley Rd

S 21

st S t

Jet Wing D

r

N W

ahsa

tch A

ve

Cres

ta R d

Milam

Rd

Goldfield Dr

Me sa Ridge Pky

S 8th StW Fillmore St

Vickers Dr

Briargate Blvd

Bradley Rd

Manitou Av e

Lake Ave

Bradley Rd

Carefree Cir NVo yager Pky

Old Ranch Rd

North Gate Rd

Briargate Pky

S Circle Dr

Mesa Rd N Circle Dr

Grinn

ell B

lvd

Barnes Rd

Airport Rd

Research Pky

N 30th

St

Marks

heffe

l Blvd

W Garden Of The Gods Rd

Stetson Hills Blvd

W Woodmen Rd

Peter

s on

Rd

N Ne

vada

Ave

Palmer Park Blvd

Burgess Rd

Shoup Rd

Hancock Expy

Blac

k For

est R

d Vollm

er Rd

Constitution Ave

N Ma

rkshe

ffel R

d

S Powers Blvd

Austin B

luffs P

ky

Centennial Blvd

N Un

ion B

lvdE Woodm en Rd

E Woodmen Rd

E Platte Ave

Austin Bluffs Pky

MLK Bypass

16

122

38

83

29

94

115

83

83

24

24

85

87

87

85

87

85

24

24

24

25

25

25

25

NORTHWEST

NORTHEAST

WESTSIDECDB

FRINGE

SOUTHWEST

EAST

SOUTHEAST

CBD

Industrial Market Trends Colorado SpringsGrubb & Ellis Research2nd Quarter 2011

Grubb & Ellis|Quantum Commercial Group101 N. Cascade Avenue, Suite 200Colorado Springs, CO 80903Phone: 719.590.1717 • www.geqcg.comIndependently Owned and Operated

No warranty or representation expressed or implied is made as to accuracy of the information con-tained herein. No legal or tax advice to is intended in this publication. This information may be reprinted, if credit is given to Grubb & Ellis Quantum Commercial Group.

© 2011 Grubb & Ellis|Quantum Commercial Group

Despite uncertainty in Washington the Industrial market for Colora-do Springs is showing signs of stabilization. But, will it be derailed by National Debt, Jobs Growth, and Politics?

Industrial leasing activity for 2nd quarter of 2011 on paper looks good, and vacancy rates have fallen back to 10.2%, which is down from 1st quarter 2011’s rate of 11.3%, but take into consideration that 101,355 square feet was a “charity” lease by the El Pomar Foundation to Goodwill Industries and one has to take the good news with a grain of salt.

The sale values of all industrial properties sold in 2010 showed an aver-age of $42.49 per square foot, which is around 30% below the $60 per square foot average and still well below the replacement cost for such properties. As of the end of 2nd quarter 2011, nineteen (19) industrial properties have sold for a total of 227,632 square feet for $11,172,500 or $49 per square foot. The mix comprises of twelve (12) properties pur-chased by owner/users totaling 150,550 square feet for $6,396,500 or $42 per square foot. Investors account for seven (7) properties totaling 77,082 square feet for $4,776,000 or $62 per square foot.

Even with all the doomsday analysts and political fi nger pointing in the media and Washington DC, businesses and investors are taking ad-vantage of low rents and distressed properties as opportunities to lower overhead and diversify portfolios into long term real estate investments. The net effect for 2nd quarter 2011 has been a positive absorption of 331,330 square feet.

Lease rates are still falling, from the historically averaged $6.50 NNN to $6.05 per square foot (source TCR).

FORECAST

• Weak employment, slow local/national residential recovery, and rising national debt will limit speed of recovery.

• Lease Rates will continue to decline as Landlords continue to offer concessions & discounts.

• Owner/Users and Investors will continue to fi nd low sale prices, but reduced inventory of desirable properties.

2004 2005 2006 2007 2008 2009 2010 June 2011

Absorption 322,566 732,578 1,074,246 -169,706 -178,502 1,926,532 11,579 405,807Leasing Activity 773,930 1,260,633 1,034,628 856,421 1,044,027 1,152,590 976,840 708,342

-500,000

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

Industrial Buildings Leasing and Absorption

Source: Turner Commercial Research

Change from last Forecast

Current QtrQtr Year Qtr Year

Vacancy Rate 10.2%

Net Absorption 331,330SF

Asking Rent $6.05

U/C 0

2004 2005 2006 2007 2008 2009 2010 June 2011

Vacancy 10.5% 8.1% 6.4% 7.9% 8.9% 11.4% 11.5% 10.2%Lease Rates $6.84 $6.80 $7.15 $7.03 $7.01 $6.49 $6.17 $6.05

$5.40$5.60$5.80$6.00$6.20$6.40$6.60$6.80$7.00$7.20$7.40

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

Industrial Buildings Vacancy vs. Lease Rates

Colorado Springs Industrial Market 2nd Quarter 2011

TENANT/BUYER LANDLORD/SELLER PROPERTY SIZE (SF)

Bestway Disposal Kenneth Watt 4005 Interpark 90,000

Entegris IBG Corporate Ridge 40,000

Tegrant Corp Full Circle V. Sears Service Center 30,000

KEY TRANSACTIONS

SUBMARKET TOTAL SF VACANT SFLEASING ACTIVITY

YTDNET ABSORBTION

YTDNNN

ASKING RENTCBD 719,276 205,705 0 0 $4.38

CBD FRINGE 1,992,484 105,923 41,192 31,647 $5.57

NORTHWEST 9,438,657 833,313 428,263 305,011 $6.82

NORTHEAST 4,878,725 613,958 73,479 -32,993 $7.10

EAST 9,841,844 964,493 92,927 35,688 $5.57

SOUTHEAST 4,465,012 678,303 67,641 62,707 $4.92

SOUTHWEST 2,046,291 28,746 4,840 10,797 $5.88

WEST 247,317 9,050 0 -7,050 $7.50

TOTAL 33,629,606 3,439,491 708,342 405,807

Vacancy Rate - 10.2%Average Asking Rent - $6.05

TCR-Turner Commercial Research2011 Commercial Availability Report

Leasing Sales

U n i t e d S t a t e sA i r F o r c eA c a d e m y

C o l o r a d o S p r i n g sM u n i c i p a l

A i r p o r t

Cheyenne MountainAir Force Base

PetersonAir Force

Base

F o r t C a r s o n

N Powers Blvd

Interquest Pky

S Ne

vada

Ave

E Platte AveMidland ExpyW Cimarron St

S Ac

adem

y Blvd

NPo

wers

Blvd

N Ac

adem

y Blvd

E F o untain Blvd

E Uintah St

Drennan Rd

Vindic ator Dr

MainSt

E Pikes Peak Ave

E Fillmore St

Galley Rd

S21

stS t

JetWing Dr

N W

ahsa

tch A

ve

Cres

taR d

Milam

Rd

Goldfield Dr

Me sa Ridge Pky

S8thSt

W Fillmore St

Vickers Dr

Briargate Blvd

Bradley Rd

Manitou Av e

Lake Ave

Bradley Rd

Carefree Cir N

Vo yager Pky

Old Ranch Rd

North Gate Rd

Briargate Pky

S Circle Dr

Mesa Rd N

CircleDr

Grinn

ell B

lvd

Barnes Rd

Airport Rd

Research Pky

N 30th St

Marks

heffe

l Blvd

W Garden Of The Gods Rd

Stetson Hills Blvd

W Woodmen Rd

Peter

s on

Rd

NNe

vada

Ave

Palmer Park Blvd

Burgess Rd

Shoup Rd

Hancock Expy

Blac

k For

est R

d Vollm

erRd

Constitution Ave

N Ma

rkshe

ffel R

d

S Powers Blvd

Austin B

luffs Pky

Centennial Blvd

NUn

ionBl

vd

E Woodm en RdE Woodmen Rd

E Platte Ave

Austin Bluffs Pky

MLK Bypass

16

122

38

83

29

94

115

83

83

24

24

85

87

87

85

87

85

24

24

24

25

25

25

25

NORTHWEST NORTHEAST

CBDFRINGE

SOUTHWEST

EAST

SOUTHEAST

CBD

WEST


TRANSACTION SERVICES

Grubb & Ellis has one of the largest and most experienced real estate brokerage sales forces in the country. Our team of specialists cover all aspects of commercial real estate and work closely with owners, tenants and investors to assess the ways in which real estate issues relate to, and contribute to, an organization’s strategic business objectives. Last year, Grubb & Ellis and its affi liates completed 16,250 transactions val-ued at more that $22 billion.

Transaction services include:• Agency Leasing • Tenant Representation • Consulting Services • Valuation Consulting • Site Selection • Property Management• Transaction Management• Institutional Investment Services • Private Capital Investment Services

Grubb & Ellis|Quantum Commercial GroupColorado SpringsReal Estate Advisors

Jason Dreger 719.228.3612 [email protected]


IV. Pricing Guidelines - Asking Price

TOTAL PORTFOLIO $5,430,800

EACH BUILDING 4980 Centennial Boulevard - $1,210,000 ($50.00 PSF)

5010 Centennial Boulevard - $2,800,000 ($81.87 PSF)

5030 Centennial Boulevard - $1,420,800 ($40.00 PSF)

CAPITALIZATION RATE 9.54% for 5010 Centennial Boulevard only

Size: 7,800 SF Office 16,400 SF Production/Warehouse 24,200 SF Total Building SizeLand Area: 2.02 Acres (87,991 SF)Construction: Insulated, fluted masonry block walls with precast concreteRoof: Twin-tee concrete structural roof system. Insulated tar and gravel roof protection systems. Year built - original.HVAC: 6 – 4 ton roof top units 100% air-conditioned and heated via combination units and swamp coolers.Electrical: Main serviece of 1,000 Amps, 3 Phase, 120/208 Volts. Secondary service of 400 Amps, 3 Phase, 277/480 Volts – IMPLoading: Two (2) 10’ x 10’ dock-high overhead doors with dock levelers and shelters One (1) 12’ x 12’ drive-in overhead door One (1) 10’x10’ dock high overhead door blockcastFiber Optics: Located at Property line

Fire Protection: Non-Sprinklered

Ceiling Height: 15’ – 16’ clear

Zoning: PIP-2

Parking: 65 spaces – 2.71 per 1,000 SF

Year Built: 1979

Property Description: Lot 1 Pinion Valley Industrial Park Fil No 1

Lease Rate: $5.95 PSF, NNN

Sales Price: $1,210,000 ($50 PSF)

V. Property Description

4980 Centennial Boulevard

4980 CENTENNIAL BOULEVARD - 24,000 RSF

Size: 34,200 SFLand Area: 2.16 AcresConstruction: MasonryRoof: Twin-tee concrete structure – Insulated Goodyear SPM rubber roof with rock ballast. Year built - originalHVAC: Entire building is 100% air-conditioned. Roof top combination unit in office area and portion of the production area. Ceiling hung unit heater in production and shipping area. Air-conditioned in production area provided by roof mounted swamp coolers.Electrical: Primary service is 800 Amps, 3 Phase, 277/480 Volts. Typical lighting in general office and sort-area.Loading: 4 – 12’ x 12’ drive-in doors 1 – 14’ x 14’ drive-in door 1 – 10’ x 10’ dock-high overhead doorFiber Optics: Located at property lineFire Protection: SprinklersCeiling Height: 14’ – 16’ clearZoning: PIP-2Parking: 80 spaces – 2.34 per 1,000 SFYear Built: 1983Property Description: Lot 2 Pinion Valley Industrial Park fil No 3Lease Expiration: 12/31/2014 – (4th Amendment). Original occupancy date was 10/1/1984.Use: Transportation of high priority packages, documents and electronic transportationRoof: Landlord’s responsibility to maintain ($1,950 for 2011)Insurance: Landlord responsibility to maintain fire insurance for structural shell ($2,100 for 2011)Current NOI: $267,156.00Sales Price: $2,800,000 ($81.87 psf – 9.54% cap)

Property Description

5010 Centennial Boulevard • FedEx Building

Size: 9,600 SF Office 24,600 SF Production / Process, 1,320 SF Chemical Storage 35,520 SF Total Building SizeLand Area: 2.415 Acres with 34% lot coverageConstruction: All exterior walls are 8” insulated precast concreteRoof: Precast concrete twin-tee structural roof system Roof protection is insulated Carlisle SPM system with rock ballast system. Year built - original.HVAC: Entire building is heated and air-conditioned with a redundant boiler/chiller system with Robert Shaw DMS – 350 A digital monitoring and control system. Air-handling and special treatment equipment for manufacturing advanced printed circuit boards. One class 100 clean room. One class 1000 clean room.Electrical: 2,500 Amp, 3 Phase, 277/480 Voltage, 40 kw backup diesel-powered generatorLoading: One (1) 10’ x 10’ dock-high overhead door with dock leveler One (1) 12’ x 12’ drive-in overhead doorFiber Optics: Located at property line

Fire Protection: Automatic sprinkling system, type #11 rating

Ceiling Height: 14’ – 16’ clear

Zoning: PIP-2

Parking: 85 spaces – 2.39 per 1,000 SF

Year Built: 1987

Property Description: Lot 1 Pinion Valley Industrial Park Fil No 3

Phase I & II: Available

Lease Price: $5.50 PSF, NNN

Sales Price: $1,420,800 ($40 PSF)

Property Description

5030 Centennial Boulevard

VI. Operating Expenses

Expenses2011

Estimate2011

Estimate / S.F.CAM $5,040.00 $0.21Property Taxes $16,269.00 $0.68Insurance $3,600.00 $0.15Total $24,909.00 $1.04

Expenses2011

Estimate2011


Expenses2011

Estimate2011





1225 Seventeenth Street Suite 1900 • Denver Colorado 80202 tel +1 303 260 6500 fax +1 303 260 6501

101 North Cascade Ave, Suite 200 • Colorado Springs, Colorado 80903 tel +1 719 590 1717 fax +1 719 634 0404

VII. Disclaimer

This Brochure is provided for the sole purpose of allowing a potential investor to evaluate whether there is interest in proceeding with further discussions regarding a possible purchase of or investment in 4890, 5010 & 5030 (“the Property” or “Piñon Valley Industrial Park Portfolio”).

The potential investor is urged to perform its own examination and inspection of the Property and information relating to same, and shall rely solely on such examination and investigation and not on this Brochure or any materials, statements or information contained herein or otherwise provided.

Neither Jones Lang LaSalle Americas, Inc. nor the Receiver, nor any of their respective partners, directors, officers, employees, shareholders and agents (collectively, “Agents”), make any representations or warranties, whether express or implied, by operation of law or otherwise, with respect to this Brochure or the Property or any materials, statements (including financial statements and projections) or information contained herein or relating thereto, or as to the accuracy or completeness of such materials, statements or information, or as to the condition, quality or fitness of the Property, or assumes any responsibility with respect thereto. Such materials, statements and information have in many circumstances been obtained from outside sources, and have not been tested or verified. Projections, in particular, are based on various assumptions and subjective determinations as to which no guaranty or assurance can be given.

Without limiting the foregoing, in the event this Brochure contains information relating to asbestos or any other hazardous, toxic or dangerous chemical, item, waste or substance (“Hazardous Materials”) in relation to the Property, such information shall in no way be construed as creating any warranties or representations, expressed or implied, by operation of law or otherwise, by Agents or the Receiver, as to the existence or non-existence or nature of Hazardous Materials in, under, on or around the Property.

This Brochure is provided subject to errors, omissions, change of price or terms and other changes to the materials, statements and information contained herein or relating to the Property, and is subject to withdrawal, all without notice. The contents hereof are confidential and are not to be reproduced or distributed to any person or entity without the prior written consent of Agents or used for any purpose other than initial evaluation as indicated above.

ContactsMitchell H. Zatz, SIOR+1 303 217 [email protected]

Michael Palmer+1 719 228 [email protected]

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