The upside of a down market

Before the commercial real estate market took a downturn, Fort Collins-based Brinkman Partners already had done work in Phoenix and planned to expand to other areas.

In May, the 5-year-old real estate, development and construction services company opened an office in Denver.

“With the market bottomed out, it’s a good time to take advantage of that and branch out,´ said Peter Meyer, vice president of business development who splits his time with Brinkman between Fort Collins and Denver. “We’re fortunate in that we are one of the few companies that is growing right now, so we’re able to do this.”

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Other area companies involved in commercial real estate also have been branching out, becoming more regional than focusing solely on projects in Northern Colorado. The result is that such firms are growing to be competitive on a larger scale.

Some of it has been driven by the market. But other companies have been growing regionally – and nationally – for years, and the current downturn has only spurred additional expansion.

Spread out to grow

One example is Greeley-based Roche Constructors Inc., which does commercial construction. The company started in Greeley in 1971 and has grown under Tom Roche, the founder’s son, to include offices in Denver and Las Vegas. Current projects are going on in Nevada, Arizona, New Mexico, Texas and Washington, D.C.

The company’s recent construction of a Safeway store in Washington, D.C., has resulted in plans for a new Roche office there, set to open in early 2010.

Given that his company is looking at three down years in a row, opening a new office is a good sign, Roche said.

“The last two or three years, we realized we were going to have to spread out some more if we were going to continue to grow,” he said.

In the 1980s, Roche Constructors started getting contracts outside Northern Colorado. Even with residential construction slowed down considerably throughout the country amid the current recession, commercial construction is still happening.

“Instead of waiting for rooftops, companies like Safeway are opening stores in areas where redevelopment is happening,” Roche said. “Residential construction is not coming back yet, but there’s plenty of medical and retail still going on.”

Neenan Archistruction is riding that wave of health care and commercial construction as well. Kyle Henderson, vice president for real estate development, is opening the company’s third office outside Fort Collins in Fort Worth, Texas, in August.

“We’ve just held the grand opening on our third project in Texas, a health-care center in San Antonio,” Henderson said. “We’ve had Texas on the radar for some time.”

Other Neenan offices in the Roaring Fork Valley and Vancouver, Wash., utilize the talents of the in-house staff of 19 architects and 64 designers – or archistructors, as they are known in the company – to complete projects around the country.

“We develop and maintain the relationship with the clients in the various markets, but the people who do the work are all right here,” Henderson explained. “We provide services from helping determine market need to how to sustain the building once it’s occupied, but we bring the dollars back to Fort Collins.”

Expanding to be competitive

Expanding into other areas has also made Realtec, one of the major players in commercial real estate in Northern Colorado, more competitive in a down market. In May 2008, the company opened a branch office in Denver. With offices in Fort Collins, Loveland and Greeley, the company previously had to farm out business to other companies when a client requested services in the Denver area.

“Now when a need comes up, I am able to take care of it,´ said Chris Mooney, broker/partner with Realtec based in Denver. “I am working on eight deals right now, and three of them are referrals from the Fort Collins office. We have more complete coverage now, and we’re able to offer a level of comfort to clients who want that consistency working with the same company.”

Competition in the Denver market is tight, but the new office there has allowed Brinkman to increase its competitiveness in its niche market, sustainable construction projects. Sustainable building has become more popular and less expensive, increasing the feasibility of doing such construction for many commercial projects.

For those involved in construction, moving into other markets can be tough because you need personnel and established relationships with subcontractors in the area. But Brinkman’s Northern Colorado connections – and its proximity to the Denver area – has been a plus, Meyer said.

“The Northern Colorado subcontractors are able to offer more aggressive pricing than the Denver contractors,” he said. “And it’s not a big deal for them to commute to Denver.”