The headquarters of Arrow Electronics, a Fortune 500 company that guides innovation for leading technology manufacturers and service companies, was sold after 15 years of ownership for $40.1 million. The New York real estate investment firm, Davidson Kempner Capital Management, sold the 128,000 SF building in Centennial, CO to Kawa Capital, a Miami-based independent asset management firm. Kawa paid more than 50% higher per square foot than the average sales price for office buildings in the Panorama-Highland Park area at $312 per square foot. So why would Kawa pay a premium price for a building that is located in an area that currently has 10.1% vacancy rate?
The exorbitant price tag connected to the building might have some correlation to the tenant, Arrow. During the first quarter of 2019, Arrow reported a net income of $141 million which was a 1.4% increase since the first quarter of 2018. Arrow is the sole occupant in the building with 550 employees and a long-term lease that is good through 2033. Regardless of the new ownership, the deal will not impact the day-to-day operations for Arrow.
Davidson Kempner Capital Management originally bought the building located on 9201 E. Dry Creek Road for $24.8 million and owns three other buildings in Colorado, including the building occupied by the Global Healthcare Exchange and Rogue Software in Louisville.
