Westport Capital Surrenders 300K sf Office Tower in Denver

Westport Capital Partners has surrendered a nearly 300,000-square-foot office tower in downtown Denver to its lender after defaulting on a $48.45 million loan.

The Connecticut-based investor inked a special warranty deed, giving over the 31-story building at 1660 North Lincoln Street to an affiliate of New York-based Benefit Street Partners, the Denver Business Journal reported.

Westport Capital bought the 298,900-square-foot building in 2018 for $67.2 million, or $225 per square foot. Two years later, it completed upgrades to its lobby and tenant amenities.

In April 2021, Westport landed the $48.45 million four-year bridge loan from Benefit Street Partners, with a one-year extension option, according to the Business Journal.

Westport defaulted on the bridge loan at an undisclosed date, according to public records filed last month.

The office tower, built in 1972, has an 8,800-square-foot tenant lounge, training room, game area, bicycle storage room, gym and coffee shop. It sits above an 11-story parking garage. The property is managed by Unico, which sold the building to Westport.

More than $19 million in renovations were put into the building between 2016 and 2020, JLL said in 2021. It’s not known how much Westport, which bought the building in the middle of the revamp, contributed to the upgrade.

Tenants include the Denver Business Journal; Coalition Space, a coworking firm; interior architect TPS; the U.S. Meat Export Federation; the American Petroleum Institute; and law firms Ireland Stapleton Pryor & Pascoe PC, Watton Law Group and Wells Family Law.

The occupancy of the building at the time of the loan default was not disclosed.

Office vacancy in the city’s Central Business District in the three months ending in December was 34.9 percent, 2.8 percent higher than a year earlier, the Colorado Sun reported, citing CBRE.

At the same time, downtown Denver had 10 million square feet of offices available, with another 1.7 million square feet of subleased space on the market, down 14.8 percent from a year ago.

Investors recently flipped the keys to three other downtown Denver office buildings to their lenders, according to the Business Journal.

Westport, founded in 2005 in Stamford with an office in Los Angeles, has $7.2 billion in real estate assets under management, according to its website.

— Dana Bartholomew