Real Estate: The Broe Cos. hopes to develop land near O-I

WINDSOR — Last month’s announcement that Owens-Illinois Inc. would build a bottle-manufacturing plant in Windsor shed some light on a low-profile company with high impact on Colorado’s real estate market.

The Broe Cos. of Denver, which owns the shortline Great Western Railway, was an influential player in the courting of Owens-Illinois.

In the end, it was The Broe Cos. that bought a 150-acre farm on the east edge of Windsor that Owens-Illinois has identified as the “sweet spot” for a factory in Northern Colorado. The Broe Cos. then sold 90 acres to Owens-Illinois that the company needed for the bottle plant.

The incentive for The Broe Cos. to take a role in the Owens-Illinois transaction was obvious — the bottle maker will become a huge customer for Great Western Railway. The railway now runs 14,000 cars a year in Northern Colorado — Owens-Illinois will increase that traffic by 28 percent a year.

Meanwhile, The Broe Cos. has plans for the remaining 60 acres it still owns near Windsor. The property will be developed for industrial or distribution uses.

“We’re looking to attract more customers ? more business and more users for our railroad,´ said Alex Yeros, managing director for The Broe Cos.

The form of the development hasn’t been determined.

“Maybe it’s one user, maybe it’s 15,” Yeros said.

Great Western Railway is a subsidiary of Broe’s OmniTrax railroad company, the largest privately held railroad company in North America. The rail business is just one of a multitude of holdings for company chairman Pat Broe.

(Incidentally, OmniTrax is also the largest shortline railroad operation in Canada, where it also serves an Owens-Illinois bottle plant.)

Last year, the The Broe Cos. announced that it would build four ethanol production plants in Saskatchewan, making it the largest producer of ethanol in Canada.

The Broe Cos. also operates Aspen Retirement Corp., which owns eight retirement communities in four states. The company is in the midst of a $200 million investment campaign to expand its senior housing network.

Another Broe affiliate is McKinley Medical, a supplier of infusion systems for oncology and pain-management treatment.

But The Broe Cos. seems best at making savvy real estate deals. For instance, the company raised some eyebrows last month when it bought the 350,000-square-foot Cascades office building in Greenwood Village for $24 million. The previous owner had paid $38.5 million in 1997, and insiders claim the building was worth nearly $60 million at the peak of the market in 1999.

H-P complex closer to sale

GREELEY — Hewlett-Packard Co. halted the bidding on its vacant Greeley facility, which is on the market for $14 million, Oct. 15.

It remains to be seen if the local investment consortium, which includes Greeley businessman Mick Todd, can carry the day with its offer.

Todd and his partners made an offer on the 355,000-square-foot facility late in the summer. However, H-P has kept the door open for other competitors.

Peter Kast, a broker for Realtec Commercial Real Estate Services Inc. which is listing the property for H-P, said he expects out-of-town players to be in the mix by the time the deadline passed.

At any rate, H-P “would like to close by the end of the year,” Kast said.

Encorp sells, leases back building

WINDSOR — In an effort to free up capital for its expanding business, Encorp Inc. has cut a sale-lease-back deal for its 80,000-square-foot building, 9351 Eastman Parkway in east Windsor.

“At a time when we’re needing to grow fast and we’re needing to expand our product development rather than have cash tied up in this building, we’d like it in our own bank account,´ said Dennis Orwig, the company’s CEO.

Encorp sold the two-year-old building to Loveland investor Steve Schroeder, then signed a 20-year lease. The deal includes options to extend the lease, and first right of refusal to build on adjacent land should the company need to expand.

“We’re not leaving Windsor at all,” Orwig said. “We just said we can use our cash in a more productive way to grow the company.”

Encorp uses about 70 percent of the building and might sublease the vacant space until it’s needed.

“In our three-year business plan, we will definitely grow into that space,” Orwig said.

Editor Bob Baun can be reached at (970) 221-5400, (970) 356-1683 or via e-mail at bbaun@ncbr.com. His fax number is (970) 221-5432.

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