Real Estate & Construction  March 12, 2010

Parking space makes the deals go ’round

FORT COLLINS – An urgent need for additional parking at the Institute of Business and Medical Careers paved the way for a new location for the Carousel Dinner Theatre.

In early March, the seemingly unrelated businesses closed on a series of transactions in which the dinner theater will take control of the long-vacant Mann Theater at 3750 S. Mason St., while IBMC will pick up an additional 150 parking spots on the south side of the building. The entire property was purchased from a Denver car dealer for $1.1 million, then split into a $700,000 building and $400,000 parking lot.

Carousel will gain more than 5,000 square feet of space when it moves from its current location at 3509 S. Mason St., which also has limited parking. Kurt Terrio, owner of the Carousel, has been working with RB+B Architects in Fort Collins on plans to update the 18,860-square-foot former movie theater into a space appropriate for staging musicals and serving meals.

The deal came after IBMC spent more than a year searching for an appropriate user and willing buyer for the building, three years after the property was originally listed for sale and 13 years after the Mann Theater went dark.

Car dealer Lithia Motors purchased the 3.3-acre site in October 2002 for $1.8 million with plans to convert it into new showroom space, but that expansion never happened. Lithia listed the property three years ago at $2.2 million and attracted serious interest from four or five potential buyers. However, the offers were too low for the company.

“We’ve lost a decade in value and pricing,´ said Sperry Van Ness broker Craig Hau, who helped list the property. “You’ve got a lot of sellers in denial.”

The brokers considered finding a user that could redevelop the site into a multi-unit residential tower, for example, right about when the residential market slowed to a crawl.

After Denver’s “Dealin’ Doug” Moreland bought the Lithia Fort Collins dealership in early 2009, his desire to unload the unneeded property outweighed any aspirations to collect full price.

At the same time, the change in ownership put IBMC in a parking pinch. IBMC had moved into the former Colorado Labor Department building at 3842 S. Mason St., next to the Mann Theater site, on Labor Day 2008, because the facility was well situated and the parking situation seemed ideal. The future plan to develop Mason Street into a transportation corridor was a secondary consideration for the school.

IBMC has seen rapid growth among its three campuses in Fort Collins, Greeley and Cheyenne, Wyo. In 2008, when the institution moved into the new building total student enrollment stood at just over 540. This year IBMC has 829 students, 385 of which attend classes in Fort Collins. Morning and evening classes are the largest and the 115-space IBMC lot was not up to the challenge.

“It became obvious fairly quickly that we couldn’t make (the parking) work,´ said CEO Rich Laub.

Permanent parking fix

Laub and IBMC President Steve Steele received permission from Lithia to allow students to park in the mostly vacant lot next door. However, students and staff arrived one morning following Lithia’s departure to find the gates to the lot closed and locked. A temporary solution was offered by the neighboring Salvation Army, but Laub started working in earnest on securing a permanent fix.

IBMC put the property under contract with the intention of finding a user for the building while maintaining the parking lot for the students. Working with the Sperry Van Ness team as well as Palmer Properties, IBMC tried to find a buyer, but the cost to convert the former theater into a new use proved to be too much for several prospects.

“We had several people who were interested, but things just kept falling through,” Laub said.

After three years on the market, it became evident that the original use of the building would be the highest and best use.

“Towards the end, all the parties looking at the property were theater-related,´ said Sperry Van Ness broker Travis Ackerman.

Even those potential buyers were hesitant. The building, vacant for 13 years, isn’t exactly a pretty sight right now.

“Kurt is one of these imaginative guys who walked in and could see it sparkle,” Steele said, adding that the situation couldn’t be better. “It’s really a perfect match between the businesses.”

On Carousel’s busiest days – Friday, Saturday and Sunday – IBMC doesn’t hold classes.

FORT COLLINS – An urgent need for additional parking at the Institute of Business and Medical Careers paved the way for a new location for the Carousel Dinner Theatre.

In early March, the seemingly unrelated businesses closed on a series of transactions in which the dinner theater will take control of the long-vacant Mann Theater at 3750 S. Mason St., while IBMC will pick up an additional 150 parking spots on the south side of the building. The entire property was purchased from a Denver car dealer for $1.1 million, then split into a $700,000 building and $400,000…

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