Combat Rising Costs by Adding Value - Brinkman

Combat Rising Costs by Adding Value

Although Colorado continues to celebrate a booming economy with record low unemployment, steady population and job growth, and above-average GDP growth, development costs continue to present a challenge to developers. In addition to our portfolio of public/private partnerships, we’ve found additional ways to create meaningful places through a focus on value-add acquisitions.

Although sporadic in this market, we’ve had success finding quality assets well below $200/SF compared to replacement costs around $250-$300/SF. We’ve enhanced our business strategy to put additional focus toward finding off-market Class B and mismanaged properties that provide the opportunity for us to add value through capital improvements and the leadership of our skilled property management team.

Our recent acquisition of Preston Center in Fort Collins is one example of this. It was a relatively low-cost deal (slightly more than half of what it would cost to construct) that provided an opportunity for us to make improvements that would enhance the space for current tenants and revitalize interest in the vacant units.

In today’s market, portfolio diversification is essential. Although our portfolio is varied in product-type, location, and scope, one key element remains the same across all our assets: they each provide a meaningful place that enhances our communities.

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