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Nearly five years after purchasing the former Maxtor facility in Longmont, Colorado, Denver-based Broe Real Estate Group secured a new tech tenant in one of Colorado’s biggest industrial deals this year.
BREG leased 207K SF to semiconductor manufacturer Micron Technologies Inc. at 2452 Clover Basin Drive, BusinessDen reported. It is the first new tenant BREG has signed to the 475K SF property as it executes a redevelopment effort that the company says will ultimately cost $100M, including the property’s 2017 purchase price of $8.6M.
The Front Range industrial market has been on a growth tear for nearly a decade but showed signs of slowing in the third quarter, with direct asking lease rates dipping 1.4% to $8.61 per SF on a triple-net basis, according to CBRE. Micron’s lease ranks among the five largest in the area this year, behind retail brands like Amazon, Staples and Home Depot.
Semiconductor companies like Micron got a boost earlier this year from the CHIPS and Science Act of 2022, which pumped $53B into manufacturing semiconductors, vital to the production of cars and other electronic devices. They are also used in wind turbines, solar panels and electric vehicles, all of which are part of the clean energy sector, a beneficiary of $369B from the Inflation Reduction Act.
There is an enormous need for semiconductors due to a shortage caused by firms pausing their ordering when the pandemic hit, underestimating the demand for tech and vehicles in ensuing months.
BREG purchased the property from a special servicer with plans to redevelop it, a strategy the company has executed repeatedly in the Denver market and elsewhere. Founded by local oil and rail magnate Pat Broe, BREG specializes in purchasing distressed assets and repositioning them, though it also performs ground-up development.
A $20M building rehabilitation is underway, BREG CEO Doug Wells told the Denver Business Journal.
Micron’s lease begins in September 2023, and the space has room for hundreds of new employees, the DBJ reported. The company maintains another Longmont location on Pike Road, just southeast of its new space.
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