Campus at Longmont sells for $58.3 million
Goff Capital Partners acquired the campus in mid-October from Circle Capital Longmont LLC. The portfolio includes 34 buildings and has 1.13 million square feet of office, flex and warehouse space on 130 acres, according to the Campus at Longmont's website. The price is equivalent to about $51.6 per square foot.
The deal is Goff Capital Partners' third major acquisition in a year. The partnership, which has a local office in Centennial, now owns approximately 2 million square feet and 55 properties in Boulder County. Goff Capital Partners' first acquisition was Flatiron Park in Boulder, which it bought in November 2011.
Goff Capital Partners acquired the Campus at Longmont for the same reasons it bought Flatiron Park, managing principal Conrad Suszynski said. Goff's acquisition targets are large portfolios in attractive markets, and the two business parks Goff now owns were among the largest portfolios in Boulder County.
"We do like concentrated plays. It's basically Flatiron Park all over again," Suszynski said.
Suszynski said a highly educated workforce, high quality of life and a strong entrepreneurial climate are reasons companies like relocating to or expanding in Boulder and Longmont. The mix of potential tenants and the property also made the Campus an attractive purchase.
"The types of tenants expanding and moving into the area tend to be tech companies, and the Campus at Longmont caters to that market," Suszynski said.
Circle Capital Longmont LLC, co-owned by Terry Fitzpatrick and R. Randall Clark, named the properties the Campus at Longmont after buying the properties in 2005 as part of a 2 million-square-foot portfolio from Pratt Properties in a $142 million deal. That price is about $71 per square foot.
Longmont Diagonal Investments LP, a partnership formed by Goff, is the legal entity formed to make the acquisition and is the owner of the 34 buildings. No outside brokers were involved in negotiating the deal.
Goff Capital Partners was under contract since mid-summer, Suszynski said. The relationship between Goff and Circle Capital goes back to late last year, when Goff Capital Partners hired Steve Eaton and Ted Hinchman from Circle Capital. Goff also began managing Circle Capital's assets.
"We've effectively been running the portfolio since November," Suszynski said.
Goff Capital Partners is not expecting to make dramatic changes to the property or management.
"I think it's been managed extremely well. The most significant changes we would like to make are some aesthetic capital improvements, upgrading the look of the outside and interior space," Suszynski said.
The Campus' property management team will join Flatiron Property Management, a newly formed company, to manage the buildings. Kory Cash will be the general manager of the new company.
"For our customers, I truly expect we'll be able to deliver a seamless transition," Cash said. "We're essentially working in the same seats doing the same things."
Scott Garel of Newmark Knight Frank Frederick Ross and Becky Callan Gamble, Hunter Barto and Dryden Dunsmore of Dean Callan & Co. will continue as the leasing brokers.
Suszynski declined to reveal the occupancy rate for the buildings. According to the Longmont Area Economic Council, the vacancy rate for all Longmont is 17.2 percent.
Goff entered the Boulder market last year when a joint venture it led bought 19 properties in the Flatiron Park business park, including the entire portfolio of Flatiron Park Co., giving it about 742,000 square feet. The total purchase price was more than $67.8 million, which equates to more than $91 per square foot, according to Boulder County property records.
Goff then bought the Diagonal Tech Center in Longmont, a two-building, 123,200-square-foot complex located at 1625 and 1721 Fordham St. That acquisition cost $6.875 million, or $55 per square foot.
Goff Capital Partners has been able to boost occupancy rates at Flatiron Park since acquiring the property. Last year, the occupancy rate for their properties was less than 60 percent; now it is in the mid '70s, Suszynski said.
Despite their proximity and similarities, Goff Capital Partners does not consider the Campus at Longmont and Flatiron Park to be competing properties.
"I think we're just optimizing for tenants. We can accommodate whatever they like," Suszynski said. "We don't find a lot of tenants shopping both."
Since acquiring the properties from Pratt, Circle Capital has sold portions of its holdings. According to Boulder County property records, Circle Capital sold the properties for $158.67 million, a $16.6 million profit.
In 2006, Circle Capital Longmont sold the building at 2402 Clover Basin for $60.5 million. The 461,000-square-foot space was once occupied by Maxtor Corp., is owned by a real estate investment trust based in the Northeast, and currently is vacant and available for sublet, Longmont Area Economic Council president and CEO John Cody said.
Also in 2006, Circle Capital sold the 28,744-square-foot building at 2600 Trade Center Ave. and the 43,122-square-foot building at 2620 Trade Center Ave. for $6.79 million.
Circle Capital sold 2040 Miller Drive, a 62,200-square-foot building, to Flagstaff Building Corp. for $4.98 million in 2008. In 2011 it sold three buildings totaling more than 268,000 square feet for $28.1 million to FGECO LLC, a New York City-based company. The tenants in FGECO's properties include the Longmont campus of Front Range Community College.
The final sale now closes the book on Circle Capital's time in Longmont.
"From what I can tell they were good landlords," Cody said, "and they did a good job with what they had."
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