“Observatory Park was a rare opportunity to acquire an off-market core-plus asset in an extremely tight market,” Scott McClave, Bascom’s senior principal, said. “The quality of the asset, proximity to employment, transportation, and educational facilities coupled with robust market fundamentals were extremely attractive to us.”
Tim Shunta of National Realty Advisors LLC facilitated the transaction while Charles Halladay and Jamie Kline of HFF arranged a $66.75 million loan with TH Real Estate on behalf of the buyer.
Mill Creek Residential will remain property manager on the property.
Bascom plans to begin an amenity expansion program and improve operations to bring Observatory Park to the top multifamily products in the immediate area. Those improvements will include upgrades to the fitness center, pool and both exterior upgrades and interior enhancements.
The property was developed by Mill Creek Residential in Denver’s Observatory Park neighborhood after the company acquired approximately an acre of land in 2015 that at the time contained surface parking and five single-family homes.
Bascom paid for the property thanks to investment proceeds from the sale of a successful 20-year investment in a portfolio of Southern California-based industrial and self-storage properties, sold through the company’s industrial affiliate, the Southern California Industrial Fund and its managing member, The Magellan Group.
A Vibrant Neighborhood
Originally constructed in 2017, Observatory Park is situated just a half-mile from The University of Denver campus with proximity to Denver’s major retail, restaurant and employment centers. Companies nearby include DaVita, Arrow Electronics, DISH Network and Newmont Mining.
Observatory Park residents enjoy strong access to outdoor and retail amenities including the historic Pearl Street restaurants and upscale Cherry Creek neighborhood. Being in the South East Light Rail Corridor also allows those living in the community ideal access to the University Light Rail stop.
“The University submarket was very compelling to us due to highly desirable demographics, high home prices, and affluent renter base,” James Singleton, Bascom’s vice president, said. “The property was very well designed and constructed by Mill Creek Residential—a prominent national builder with an excellent reputation.”
Additionally, Denver is experiencing one of the strongest labor force increases in the country, with 3.9 percent year over year figures, and recording an unemployment rate of 2.6 percent last December, ranking second in the U.S. for cities with populations more than 500,000.