9110 E. Nichols Avenue
Six months after acquiring Highland Place II at what appeared to be a steep discount, the owner is already moving to exit.
Hoehn Capital purchased the building at 9110 E. Nichols Ave. at auction for $7.1 million in October, less than half of its prior $14.255 million sale in 2021. At the time, the deal was viewed as a potential “steal of the decade.”
But according to sources familiar with the auction, the final price may not have been a bargain after all. Brokers involved said bidding exceeded expectations, with Hoehn Capital and another party pushing the price above what many considered market value.
The investment thesis hinged on operational synergy with the adjacent Highland Place I, which Hoehn acquired in 2022 for $22.5 million. However, the challenges at Highland Place II quickly became apparent.
The building features large, open floor plates that are difficult to lease in the current office environment. The entire second floor remains a vacant shell, and stabilizing that space alone is expected to cost more than $3 million to divide, build out, and lease to smaller tenants.
More significantly, the building’s anchor tenant, the National Cattlemen’s Beef Association, is nearing the end of its lease. Retaining the tenant would likely require near a million dollars in tenant improvements, creating additional pressure on ownership.
At the time of acquisition, ownership maintained that office demand would persist. That position has since shifted.
The marketing strategy now leans toward redevelopment potential, following Centennial’s approval of a new mixed use Midtown district surrounding the property. The plan introduces the possibility of rezoning and repositioning the site for residential or mixed use.
The shift also signals uncertainty around the future of the building’s largest tenant, which has long occupied its Mountain Regional headquarters at the property.
Together with Highland Place I, the two properties span roughly 12 acres and sit adjacent to Highland Park.
The listing reflects a broader trend across suburban office assets, where leasing risk, capital requirements, and shifting tenant demand are forcing owners to reconsider initial business plans.