Invesco, EverWest Land $101M for Denver Industrial Project

25 North, Thornton, Colo. Rendering courtesy of JLL. 

Everwest Real Estate Investors and Invesco Real Estate have secured $101.3 million in financing to refinance and complete construction of 25 North, a 936,775-square-foot industrial complex with three recently completed buildings and six planned in the Denver suburb of Thornton, Colo.

JLL Capital Markets worked on behalf of the joint venture to place the 36-month, floating-rate, non-recourse loan with a multinational bank. The JLL Capital Markets Debt Advisory team was led by Senior Managing Directors Eric Tupler and John Rose and Associate Kevin Barron.

READ ALSO: Silver Point JV Plans Denver-Area Warehouse Project

EverWest and Invesco purchased the 25 North campus in the North Denver industrial submarket in July 2020 from RE II Industrial II LLC. Adams County records indicated the 66-acre property traded for $43.4 million. At that time, the speculative industrial project had two Class A buildings totaling 219,000 square feet. The property included an adjacent, pad-ready site where EverWest, the project developer, built a 121,000-square-foot building that was pre-leased in June 2021 by Sashco, a Colorado-based company that manufactures caulks, sealants and stains.

The first phase of 25 North totals 340,200 square feet and is fully leased. The other tenants in the park are Solid Power Inc., Meati Foods and Epicurean Butter, according to Erin Everett, development manager at EverWest Real Estate Investors. Meati took 76,000 square feet to scale up its plant-based meat production.

Solid Power develops all-solid state battery cells for electric vehicles and plans to move into its 75,000-square-foot facility in the second quarter. The new facility, its second in the Denver area, will greatly expand Solid Power’s capacity to produce key materials for the battery cells. Epicurean Butter, a manufacturing company specializing in the production of flavored butters, is occupying 30,000 square feet at 25 North.

Phase 2 will consist of six speculative warehouse and distribution buildings totaling 596,575 square feet. “The six buildings will vary in size between 66,000 square feet and 135,000 square feet. We’ve had a lot of interest in Phase Two but have not executed any leases yet,” Everett told Commercial Property Executive.

The buildings are expected to be completed between 2022 and 2023. Key features include clear heights ranging from 28 to 32 feet, more than 200 dock-high doors, 34 drive-in doors, deep truck courts, abundant natural light from skylights and large windows, ample parking and ESFR fire protection.

The addresses for the assets are 14821, 14902 and 14802 Washington St. and 14903, 14803, 14827, 14929, 14927 and 14915 Grant St. 25 North is located just east of Interstate 25 and north of 144^th Avenue, providing tenants connectivity to major Denver thoroughfares with a two-minute drive to both E-470 and I-25. Tenants can reach downtown Denver, Boulder, Colo., and Denver International Airport in about 25 minutes. Fort Collins, Colo., is 35 minutes away.

Robust Development Pipeline

When Sashco, a company that has been in Colorado for more than 85 years, signed its lease at 25 North in mid-2021, EverWest executives said Thornton’s 25 North submarket was seeing strong demand from a variety of industrial tenants. A first-quarter 2022 industrial market report for Denver by Avison Young notes that the metro’s industrial market is growing rapidly and demand for industrial product is projected to remain high this year.

Avison Young adds that the market’s low vacancy rate of about 5.6 percent has prompted speculative development and an unprecedented amount of preleasing for proposed or in-progress projects. Consistent demand for industrial space has created a building boom, with more than 14 million square feet of industrial space spread among 63 projects underway.

In its Industrial Insight report for the first quarter, JLL strikes a cautious note, observing that the rate of speculative construction deliveries has outpaced leasing and absorption for the past two quarters. The report notes that “occupier appetite must match or exceed this quarter’s 1.6 million square feet in new leases to digest both new and existing available space. At present, for every 1 square foot there will be 5 square feet delivered for the remainder of the year—assuming no further increases in construction lead times.” Describing the development pipeline as robust, JLL reported speculative space comprises 91 percent of the construction pipeline.