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Home My WebLink About20211993.tiffCOUNTY BOARD OF EQUALIZATION WELD COUNTY Single County Schedule Number: R2647503 STIPULATION (As To Tax Year 2021 Actual Value) RE PETITION OF : NAME: BANNER HEALTH ADDRESS: 2901 N CENTRAL AVE STE 160 PHOENIX AZ 85012-2702 Petitioner (s) and the Weld County Assessor hereby enter into this Stipulation regarding the tax year 2021 valuation of the subject property, and jointly move the Board of Equalization to enter its order based on this Stipulation. Petitioner (s) and Assessor agree and stipulate as follows: 1. The property subject to this Stipulation is described as: 5623 19th St, Greeley, GR HPOC BLDG ENV C HILAND PARK OFFICE COMPLEX 2. The subject property is classified as commercial. 3. The County Assessor originally assigned the following actual value to the subject property for the tax year 2021 : Total: $1,696,640 4. After further review and negotiation, Petitioner (s) and Weld County Assessor agree to the following tax year 2021 actual value for the subject property: Total: $1,395,872 5. The valuation, as established above, shall be binding only with respect to tax year 2021. 6. Brief narrative as to why the reduction was made: Further review of all approaches to value indicated an adjustment. 7. Both parties agree that: The hearing scheduled before the Board of Equalization on 08/04/2021 at 1:00 PM be vacated. [IA hearing has not yet been scheduled before the Board of Equalization. R2647503 1 Goal -199 3 ^SoIoq DATED this 19th day of July , 2021 . Ethan Horn � �1, =� Ethan Horn (Jul 20, 2021 13:00 MDT) Petitioner(s) or Agent or Attorney Address: 1999 Broadway, Suite 4100 Denver, CO 80202 Telephone: 303.222.1853 R2647503 (Assistant) County Attorney for Respondent, Weld County Board of Commissioners Address: 1150 "O" Street P.O. Box 758 Greeley, CO 80632 Telephone:(970) 336-7235 County Deputy Assessor Address: 1400 N.17th Avenue Greeley, CO 80631 Telephone: (970) 400-3650 2 R2647503/BAN N ER HEALTH stipulation Final Audit Report 2021-07-29 Created: 2021-07-29 By: TIM REDDICK (treddick@co.weld.co.us) Status: Signed Transaction ID: CBJCHBCAABAAi2JI9X9-jD7DaEIFPs537sgEsBYQIYZF "R2647503/BANNER HEALTH stipulation" History t Document created by TIM REDDICK (treddick@co.weld.co.us) 2021-07-29 - 4:09:40 PM GMT- IP address: 204.133.39.9 h Document emailed to TIM REDDICK (treddick@co.weld.co.us) for approval 2021-07-29 - 4:09:44 PM GMT CS0 Document approved by TIM REDDICK (treddick@co.weld.co.us) Approval Date: 2021-07-29 - 4:11:59 PM GMT - Time Source: server- IP address: 204.133.39.9 C'+ Document emailed to Jason Marini (jmarini@co.weld.co.us) for approval 2021-07-29 - 4:12:00 PM GMT t Email viewed by Jason Marini (jmarini@co.weld.co.us) 2021-07-29 - 4:21:07 PM GMT- IP address: 204.133.39.9 d4 Document approved by Jason Marini (jmarini@co.weld.co.us) Approval Date: 2021-07-29 - 4:25:00 PM GMT - Time Source: server- IP address: 204.133.39.9 LT+ Document emailed to Jason Marini (appeals@weldgov.com) for signature 2021-07-29 - 4:25:02 PM GMT 15 Email viewed by Jason Marini (appeals@weldgov.com) 2021-07-29 - 4:26:14 PM GMT- IP address: 204.133.39.9 4 Document e -signed by Jason Marini (appeals@weldgov.com) Signature Date: 2021-07-29 - 4:26:32 PM GMT - Time Source: server- IP address: 204.133.39.9 E? Document emailed to Ethan Horn (ethan.horn@ryan.com) for signature 2021-07-29 - 4:26:34 PM GMT .5 Email viewed by Ethan Horn (ethan.horn@ryan.com) 2021-07-29 - 5:28:59 PM GMT- IP address: 165.225.10.237 Adobe Sign Ob. Document e -signed by Ethan Horn (ethan.horn@ryan.com) Signature Date: 2021-07-29 - 7:09:47 PM GMT - Time Source: server- IP address: 165.225.10.237 Document emailed to Karin McDougal (weld-cboe@weldgov.com) for signature 2021-07-29 - 7:09:49 PM GMT fi Email viewed by Karin McDougal (weld-cboe@weldgov.com) 2021-07-29 - 8:19:30 PM GMT- IP address: 204.133.39.9 &o Document e -signed by Karin McDougal (weld-cboe@weldgov.com) Signature Date: 2021-07-29 - 8:19:50 PM GMT - Time Source: server- IP address: 204.133.39.9 Agreement completed. 2021-07-29 - 8:19:50 PM GMT Adobe Sign Thank you for submitting an appeal to the Weld County Board of Equalization. We will review the information submitted and you will receive a date to appear before the board. Contact Information: Contact Name: Ethan Horn Contact Email: ethan.horn@ryan.com Contact Phone: 303-222-1853 Appeal Submitted: 11:22 AM July 13, 2021 Appeal submitted for: R2647503 - BANNER HEALTH 5623 19TH ST, GREELEY Legal: GR HPOC BLDG ENV C HILAND PARK OFFICE COMPLEX Reason: Value Too High - The subject property is valued in excess of fair market value based on the three approaches to value; cost, market and income. In addition, the property is valued in excess of other similarly situated properties. Estimate of Value: $1,197,000.00 Document(s) Submitted: Account: All Accounts - Banner CO 2021 Westlake Analysis - Weld - 2021-05-121.pdf You have selected the following Date Preferences: The Appeal process can take several weeks for us to complete. You will receive a written decision on your appeal within five (5) working days of your hearing. We thank you for your submittal. Weld County Board of Equalization 2021-1993 ASo 109 y LO CONTACT INFO it 0 1.1 O WELD COUNTY, CO Real/Business Personal Property Appeal Appeal has been submitted Successfully! You will receive an email confirmation of your submission. Please remember to check your junk mail. You may submit another appeal or return to the Assessor's Homepae. Between May 1 and June 2, per C.R.S. §39-5-122(1), you may appeal your real property value. Between June 15 and June 30, per C.R.S. §39-5-122(1), §39-5-122(4), §39-6-111.5, §39-7-102.5, you may appeal your business personal property and/or oil and gas value. To appeal the value of your property online, please have the following information available prior to beginning your appeal: • Owner Name • Contact Phone Number • Email Address • Account/Schedule Number (found on Notice of Valuation) • Reason for Appeal • Supporting Documentation in an electronic format to be attached • Agent Authorization in an electronic format to be attached (This is required if you are acting as an agent and you are appealing an account that is not under your name as ownership) Once you have the required documentation, you can begin the appeal process by entering your emailaddress below. Upon submission of your appeal, you will receive an email confirmation that your appeal has been received. Weld County Assessors Office (970) 400-3650 Email Address: Begin Appeal Contact Information Weld County Offices: Weld County Colorado 1 150 O ST. Greeley, CO 80631 Mailing Address: Weld County Colorado PO Box 758, Greeley, CO 80632 Phone: (970) 400-4000 lOr '�-- `vim --- •••••" Useful Links • Elected Officials • Discover Weld County • Pay My Taxes • Weld County Budget • Sign Up for Emergency Alerts • Property Information • Contact Weld County • Weld County Code .z Privacy Policy & Disclaimer I Accessibility Information Social Media Commenting Policy f ,. i R 1 1 \ \\V l� i ' y?� y�.L� CAtt-. __. _-.-may_ ...� ��_...+.".r �� SFr Weld County Valuation Protest Information Submission Assessment Year: 2021 For: Banner Health Westlake Clinic 5623 19th St Greeley, CO Schedule No. R2647503 Assessor's Actual Value: $1,696,b40 Taxpayer's Opinion of Value: $1,197,000 Analysis Completed 5/12/2021 Prepared by: Ethan Horn Ryan, LLC Phone Number: (303) 222-1853 Ryan 0 2021 Property Tax Assessment Appeal Weld County Property Summary Property Name: Client Name: Assessee Name: Parcel Number: Site Address: City, State: County: Site Class: Year Built: Square Feet: Westlake Clinic Banner Health Banner Health R2647503 5623 19th St Greeley, CO Weld County Medical Office 2003 7,712 2020 County Value: Value Per SF: $1,079,311 $139.95 2021 County Value: Value Per SF: $1,696,640 $220.00 57.2% Requested Value: $1,197,000 Westlake Clinic Market Pro Forma Ryan Q Property Summary Site Address: Parcel Number: Site Class: Square Feet: 5623 19th St R2647503 Medical Office 7,712 Assumptions Market Rent $15.00 Vacanc 10.0% Expenses 8.0% Cap Rate 8.00% Pro Forma PGI Per SF Revenue Potential Gross Income Vacancy & Collection Loss Effective Gross Income Operating Expenses Non -Recoverable Expenses Total Expenses Net Operating Income Capitalization Rate Effective Tax Rate Loaded Rate Stabilized Value Less Deferred Maintenance Less Rent Loss / Lease Up $115,680 $11,56$ $104,112 $8,329 $8,329 $95,783 8.00% 100.0% 10.0% 90.0% $is.00 $1.50 $13.50 EGI Per SF 8.00% $1,197,000 8.0% 8.0% 92.0% $1.08 $1.08 $12.42 Indicated Value: $ 1,197,000 Value Per SF: $15.21 2021 County Value: $1,696,640 Value Per SF: $220.00 Lease Comps Summary Deals Gross Asking Rent Per SF Lease Comps Report Gross Starting Rent Per SF Avg. Months On Market 6 $22.00 $14.74 LEASE COMPARABLES 21 Lyons Google, Livermore Bellvue 36 ulder Carr Wellington Nunn Fort Collins 14 ,h._.,Windsor w Loveland Berth( Longmc SUMMARY STATISTICS Johnstown ud nt Eaton Fort Lupton Hereford 6riggsdale (392) Roggen Pawnee National Grassland Keenesburg Hudson ant Lease Comparables Raymer Stoneham ern 71 chard Weldona Wiggins Huy 144 Fort Morgan Brush Willard Hillrose Pacer 04) Sterlinc Atwood Merino (63) Akron Map data ©2021 Rent Deals Low Average Median High Gross Asking Rent Per SF 6 $13.00 $22.00 $19.96 $31.23 Gross Starting Rent Per SF 2 $13.00 $14.74 $14.58 $16.16 Gross Effective Rent Per SF - - - - - Asking Rent Discount 2 0.0% 0.0% 0.0% 0.0% TI Allowance 1 $0.00 $0.00 $0.00 $0.00 Months Free Rent - - - - - Lease Attributes Deals Low Average Median High Months on Market 6 3 21 10 77 Deal Size 6 11280 41049 1,833 12,678 Lease Deal in Months 2 36.0 252.0 252.0 468.0 Floor Number 6 1 1 1 3 Copyrighted report licensed to Ryan LLC - 499447 CoStar 5/12/2021 Page 1 Lease Comps Summary Property Name - Address Rating Lease Comps Report SF Leased Floor Lease Sign Date Type Rent Rents Rent Type s` ' ` ' Building 3109 A 35th Ave . * * 1,650 1st 6/10/2020 New $13.00 Starting „ Mountain Vista 7251 W 20th St Bldg J & K ** 1,584 1st 3/25/2020 New $14.00/nnn Asking KIDS Sixth Street 128 N 6th St * * 2,016 1st 2/2/2020 New $12.50/nnn Starting ;y Bldg 1675 2 18th Ave 1,280 1st 1/8/2020 New $14.00/nnn Asking 1 Bldg 1900 1 w 1 6th St * * * 12,678 3rd 1/1/2020 New $16.01/nnn Asking -R { Mountain Vista 7251 W 20th St Bldg J & K ** 5,087 1st 8/27/2018 New $14.00/nnn Asking a . I). Innovative Solutions tic Toxing Problems Copyrighted report licensed to Ryan LLC - 499447 CoStar 5/12/2021 Page 2 Lease Comparables Address Tenant Landlord SF Leased StartDate Starting Rent Free Rent Escalations Type Term Effective Rent TI Allow Expenses Ifirri I 217titi Building A 3109 35th Ave Greeley, CO 80634 Weld County Submarket Elysian Academy of Cosmotology Tamara Shotts 1,650 New Direct Jun 2020 39 Years $13.00 Mountain Vista Bldg J & K 7251 W20th St Greeley, CO 80634 Weld County Submarket Sacco Law Larry Buckendorf 1,584 New Direct May 2020 KMS Sixth Street 128 N 6th St Windsor, CO 80550 Weld County Submarket Mcfarland Earl 2,016 New Direct Mar 2020 $12.50/NNN 3 Years Bldg 2 1675 18th Ave Greeley, CO 80631 Weld County Submarket Financial Profiles NorthStar Realty Finance Corp. 1,280 New Direct Apr 2020 Bldg 1 1900 W 16th St Greeley, CO 80631 Weld County Submarket NorthStar Realty Finance Corp. 12,678 New Direct Jan 2020 Month -To -Month Mountain Vista Bldg J & K 7251 W 20th St Greeley, CO 80634 Weld County Submarket Fort Collins Women's Clinic PC Larry Buckendorf 5,087 New Direct Sep 2018 Ryan 0 Copyrighted report licensed to Ryan LLC - 499447. 40Pn t i Costar Page 3 Page 1 Sale Comps Map & List Report Sale Comparables 8 Avg. Cap Rate SALE COMPARABLES LOCATIONS Avg. Price/SF $154 Avg. Vacancy At Sale 1. 9 hf! 22rvr 2 •-1 I BS lra 13th St 2alh SI z LA 6 6 u • t 26it5t SALE COMPARABLES SUMMARY STATISTICS vi ASi M F St BUS CervteipIace as wcSI Al lath St r rt Goth St �" w2`, ncISC r { Iltak fa 2 era 1>' g 114 29th St g epthS'i rij et AA 51 2 J Island Grove R gional Park n.J Si Greeley 13the WI 1i n 1 Gth # rel ti_53 MI5 Si Garden City 045 FCS, E 20111 Si 5 22nd Si E 24th St E ?GAhSI *Ay wfl tfi fie 64 E161St 1r A E 1ftt St Map data @2021 Sales Attributes Low Average Median High Sale Price Price Per SF Cap Rate Time Since Sale in Months $1,110,000 $101 6.7% 2.7 $2,881,063 $154 7.7% 16.2 $2,831,750 $141 7.7% 14.2 $5,000,000 $226 8.7% 32.9 Property Attributes Low Average Median High Building SF Floors Typical Floor Vacancy Rate at Sale Year Built Star Rating 10,000 SF 18,720 SF 18,333 SF 34,944 SF 1 1 1 7,356 SF 17,146 SF 15,744 SF 2 34,944 SF MIS 1982 1994 1997 ***** 3.0 2002 Ryan�)rnaials to Tar►n•g TPob ems. Copyrighted report licensed to costar Group IL; CoStar m 5/12/2021 Page 1 Sale Comps Map & List Report Property Name - Address Property Sale Type Yr Built Size Vacancy Sale Date Price Price/SF Cap Rate 9p 1275 58th Ave c Greeley, CO 80634 Office ***** 1998 20,269 SF - 2/22/2021 $2,900,000 $143/SF - 9 3535 12th St Ct' Greeley, 80634 Medical - y� 1985 10,000 SF - 12/14/2020 $1,425,000 $143/SF 6.7% 9 2044 27th Ave Greeley, CO 80634 Office ***** 1982 10,964 SF - 9/3/2020 $1,110,000 $101/SF - UCHealth Peakview... co.J. 5881 W 16th St Greeley, CO 80634 Medical ***** 2002 23,400 SF - 6/29/2020 $5,000,000 $214/SF - Hiland Park 1901 56th Greeley, {''�.? Ave CO 80634 Office **** 1996 21,581 SF - 11/14/2019 $3,000,000 $139/SF 8.7% 1 250 H St Greeley, CO 80631 Office -- 1998 34,944 SF - 4/11/2019 $4,700,000 $135/SF - lip5587 Hiland Park co W 19th St Greeley, CO 80634 Office ***** 1997 16,396 SF - 21/112019 $2,150,000 $131/SF - Office 4645 Greeley, Condo c W 18th St CO 80634 Office * * * * * 1993 12,202 SF a 811412018 Condo ,500 Sale $226/SF - Riiran.) !0 Tf1 (r:) Copyrighted report licensed to CoStar Group 1L; CoStar m 5/12/2021 Page 2 2 lel 10, -4 pci ;07 2 cht . RA CS F St 1i"lifisre n ��' � WAS t Grizzly 91 re 01 V • E ci r =N Sit 0,0r.r,i 1 Island Regional Znd .__i Grove Park a ela it ec ao Greeley ads 10th Si fa 1 a i 13th Stfil ,,. y i, El 13th St > am 3r V41 13th JD Z 4 A ir} 3 , tis 0loth at 3 ti { _' il tWV I `+V f r S t _ C c9 20th St Tr€2 r ;41 w22.ruiSt rt 8 5 S 'gni St Pi ;....1 lif 5 t41$ St t6rtl 1 mile St Ccntcrplacc 7 Is el Garden rib' Goo* gap data Q2021 �� Address City Property Info Sale Info 1 3535 12th St Greeley 10,000 SF Class B Office/Medical Sold: $1,425,000 ($142.50/SF) 2 5881 W 16th St Greeley 23,400 SF Class B Office/Medical Sold: $5,000.000 ($213.68/SF) 3 4645 W 18th St Greeley 12,202 SF Office/Loft/Creative Class B Space Sold: $2;763,500 ($226.48/SF) 4 5587 W 19th St Greeley 16,396 SF Class B Office Sold: $2.150;000 ($131.13/SF) 5 2044 27th Ave Greeley 10,964 SF Class B Office Sold: $1,110;000 ($101.24/SF) 6 1901 56th Ave Greeley 21,581 SF Class B Office Sold: $3,000.000 ($139.01/SF) 7 1275 58th Ave Greeley 20,269 SF Class B Office Sold: $2,900,000 ($143.08/SF) 8 1250 H St Greeley 34,944 SF Class B Office Sold: $4,700;000 ($134.50/SF) Copyrighted report licensed to Ryan LLC - 499447. 5/12/2021 Page 3 1 3535 12th St SOLD Greeley, CO 80634 Sale Date: 12/14/2020 Sale Price: $1,425,000 Price/SF: Weld County Bldg Type: Class B OfficeMedical - Confirmed Year Built/Age: Built 1985 Age: 35 RBA: 10,000 SF ' ' ` "ie Y _ �:_�-` ��. -f "'" iF i $142.50 .. Pro Forma Cap Parcel No: 095911116016 Actual Cap Rate: 6.67% = _ Comp ID: 5331862 Sale Conditions: Purchase By Tenant, REO Sale Research Status: Confirmed 2 5881 W 16th St - UCHealth Peakview Medical Center SOLD Greeley, CO 80634 Weld County Sale Date: 06/29/2020 Bldg Type: Class B OfficeMedical Sale Price: $5,000,000 - Confirmed Year Built/Age: Built 2002 Age: 18 I Price/SF: $213.68 RBA: 23,400 SF III_ Pro Forma Cap - Parcel Actual Cap Rate: - Comp ID: 5183517 Sale Conditions: Research Status: Confirmed No: 095910229003 1031 Exchange, Purchase By Tenant 3 4645 W 18th St, Unit 400 - Office Condo SOLD Greeley, CO 80634 Weld County Sale Date: 08/14/2018 Condo Type: 12,202 SF Office Condo — Sale Price: $2,763,500 - Confirmed Year Built/Age: Built 1993 Age: 25 F= , Price/SF: $226.48 RBA: 12,202 SF - Pro Forma Cap - Parcel No: 095911348004 - Actual Cap Rate: - Comp ID: 4493798 Sale Conditions: - -- - ' Research Status: Confirmed 4 5587 W 19th St - Hiland Park SOLD Greeley, CO 80634 Weld County Sale Date: 02/11/2019 (228 days on mkt) Bldg Type: Class B Office a .� Sale Price: $2,150,000 - Confirmed Year Built/Age: Built 1997 Age: 22 ; 1 'y Price/SF: $131.13 RBA: 16,396 SF - i Pro Forma Cap - Parcel No: 095910310003 Actual Cap Rate: - Comp ID: 4676176 Sale Conditions: - Research Status: Confirmed - 5 2044 27th Ave SOLD Greeley, CO 80634 Weld County Sale Date: 09/03/2020 Bldg Type: Class B Office Sale Price: $1,110,000 Year Built/Age: Built 1982 Age: 37 Price/SF: $101.24 RBA: 10,964 SF Irrege Cornmg Soon Pro Forma Cap - Parcel No: 095913201008 Actual Cap Rate: - Comp ID: 5397339 Sale Conditions: - Research Status: Research Complete 6 1901 56th Ave - Hiland Park SOLD Greeley, CO Sale 80634 Weld County Date: 11/14/2019 (91 days on mkt) Bldg Type: Class B Office 'LfY Sale Price: $3,000,000 - Confirmed Year Built/Age: Built 1996 Age: 23 . _ . Price/SF: $139.01 RBA: 21,581 SF _ ._ -*-4 -1.6.11a1 er Pro Forma Cap - Parcel No: 095910309011 Actual Cap Rate: 8.66% . - z Comp ID: 4949307 Sale Conditions: - Research Status: Confirmed Copyrighted report licensed to Ryan LLC - 499447. 5/12/2021 Page 4 7 1275 58th Ave SOLD Greeley, CO 80634 Sale Date: Sale Price: Price/SF: Pro Forma Cap Actual Cap Rate: Comp ID: Research Status: 0212212021 $2,900,000 - Full Value $143.08 5421523 Full Value Weld County Bldg Type: Class B Office Year Built/Age: Built 1998 Age: 23 RBA: 20,269 SF Parcel No: 095910227009 Sale Conditions: SOLD 8 1250 H St Greeley, CO 80631 Sale Date: Sale Price: Price/SF: Pro Forma Cap Actual Cap Rate: Comp ID: 4739797 Research Status: Confirmed 04/11/2019 $4,700,000 - Confirmed $134.50 • Weld County Bldg Type: Class B Office Year Built/Age: Built 1998 Age: 21 RBA: 34,944 SF Parcel No: 080331111004 Sale Conditions: Copyrighted report licensed to Ryan LLC - 499447. 5/12/2021 Page 5 NORTH AMERICA CAP RATE SURVEY I SECOND HALF 2019 DENVER SNAPSHOT i I i I i r. rift a. , y. d 1i,>.d 1 1 II y •• „. i .1t.ti'. I .• l !1• • I I I J „b. • tt: I ,•. i; :Ii* 1 �6+11 • \ I I I 1�d I II 'n��, �• I1r �I �I - • I '�1{ y.r.�II I I ti d • I .rte, : ' j�• . r. a • 1 .. �. ___— ,,- �-- •551 '�'5 yY•�S•r s, •ti •': -.�,� $"..w{f5,' y+ .fit ' •' " 1 - • \ CBRE • f I I I • DENVER CAP RATES AND EXPECTED RATES OF RETURN BY PROPERTY TYPE, SEGMENT, AND CLASS PROPERTY TYPE SEGMENT STABILIZED PROPERTY ACQUISITIONS CAP RATE SPREAD OVER 10-YR TREASURY RATE H2 2019 H1 2019 CHANGE CLASS (%) (%) (bps) H2 2019 (%) EOP H1 2019 (%) EOP 1.92 2.00 VALUE -ADD PROPERTY ACQUISITIONS EXPECTED RETURN ON COST SPREAD OVER 10-YR TREASURY RATE H2 2019 H1 2019 CHANGE (%) (%) (bps) H2 2019 (%) EOP H1 2019 (%) EOP 1.92 2.00 OFFICE ALL 6.38 6.44 -6 446 444 7.38 7.50 -13 546 550 AA 5.00 5.00 0 308 300 CBD A 5.50 5.50 0 358 350 6.38 6.50 -13 446 450 B 6.50 6.75 -25 458 475 7.00 7.25 -25 508 525 C 8.50 8.50 0 658 650 8.75 8.75 0 683 675 ALL 7.34 7.53 -19 542 553 8.58 8.83 -25 666 683 AA 5.75 6.00 -25 383 400 SUBURBAN A 6.75 7.00 -25 483 500 7.50 7.75 -25 558 575 B 7.63 7.88 -25 571 588 8.13 8.63 -50 621 663 C 9.25 9.25 0 733 725 10.13 10.13 0 821 813 INDUSTRIAL ALL ALL 5.63 5.88 -25 371 388 6.63 6.71 -8 471 471 A 4.50 4.63 -13 258 263 5.25 5.25 0 333 325 B 5.25 5.50 -25 333 350 6.25 6.50 -25 433 450 C 7.13 7.50 -38 521 550 8.38 8.38 0 646 638 RETAIL NEIGHBORHOOD/ COMMUNITY ALL 7.17 7.21 -4 525 521 8.75 8.75 0 683 675 A 5.75 5.63 13 383 363 B 7.00 7.00 0 508 500 8.00 8.00 0 608 600 C 8.75 9.00 -25 683 700 9.50 9.50 0 758 750 POWER ALL 8.46 8.96 -50 654 696 12.13 10.25 188 1021 825 A 6.88 7.13 -25 496 513 B 8.00 8.50 -50 608 650 9.25 9.50 -25 733 750 C 10.50 11.25 -75 858 925 15.00 11.00 400 1308 900 HIGH STREET A MULTIFAMILY IN FILL ALL 4.92 5.13 -21 300 313 6.33 6.50 -17 441 450 A 4.50 4.63 -13 258 263 5.75 6.00 -25 383 400 B 5.00 5.25 -25 308 325 6.50 6.50 0 458 450 C 5.25 5.50 -25 333 350 6.75 7.00 -25 483 500 SUBURBAN ALL 5.04 5.21 -17 312 321 6.54 6.67 -13 462 467 A 4.75 5.00 -25 283 300 6.13 6.38 -25 421 438 B 5.00 5.13 -13 308 313 6.50 6.50 0 458 450 C 5.38 5.50 -12 346 350 7.00 7.13 -13 508 513 HOTELS ALL 7.25 7.50 -25 533 550 LUXURY 5.75 6.25 -50 383 425 CBD FULL SERVICE 7.25 7.25 0 533 525 SELECT SERVICE 7.38 7.88 -50 546 588 ECONOMY 8.63 8.63 0 671 663 ALL 8.16 8.25 -9 624 625 LUXURY 7.25 7.25 0 533 525 SUBURBAN FULL SERVICE 8.38 8.38 0 646 638 SELECT SERVICE 8.00 8.38 -38 608 638 ECONOMY 9.00 9.00 0 708 700 Source: CBRE Research O4 2019, U.S. Department of the Treasury. EOP = end of period. Note: H1 Treasury Yield as of December 31, 2019. Note: Some numbers may not total due to rounding. Note: Retail Class A, return on cost for value add was not reported due to the limited properties represented by this category. CBRE Research © 2020 CBRE, Inc. lei i dot fis: Nos 'ft* Lia U.S. CAP RATE SURVEY SPECIAL REPORT Q3 2020 A survey of CBRE investment and valuation professionals conducted between August 12, 2020 and August 26, 2020 CBRE CBRE RESEARCH STABILIZED CAP RATES • The COVID-related decline in investment sales and disruption to net operating income for many properties have created challenges in assessing average capitalization rates. To best ensure accuracy, hotels were excluded from this survey and retail cap rates were collected only for grocery -anchored properties. To supplement the cap rate data, CBRE capital markets and valuation professionals were also surveyed on current investment market conditions. • Although liquidity and investor sentiment remain strong in some segments of the market, investment volume is down significantly across all property types relative to levels prior to COVID-19. With the market still cautious, most of the cap rate compression recorded in this survey is not a reflection of rising asset values. Instead, assets are being underwritten with lower year -one income assumptions, resulting in lower cap rates (because cap rates are calculated as NOI/acquisition price). • Cap rates for Class A properties as of August 2020 differed minimally from rates at the end of 2019. For all surveyed property types except retail, the largest share of markets reported flat cap rates. The rest reported increases or decreases of between approximately 25 and 50 basis points (bps). • The suburban multifamily sector had the most markets (36%) reporting cap rate decreases, while both the CBD and suburban office sectors had the most markets (each roughly one-third) reporting cap rate increases. • 76% of markets reported unchanged industrial cap rates. Industrial was the only sector with no markets reporting increases from H2 2019. • A majority of survey respondents expect cap rates to remain unchanged through year-end 2020►, as the cautious resumption of investment activity will continue to delay extensive price discovery. INVESTMENT MARKET CONDITIONS • CBRE professionals report that a disconnect between buyer and seller expectations has emerged, with more than 60% of buyers looking for discounts from pre -pandemic prices versus 9% of sellers willing to offer them. • One-third of survey respondents were underwriting with the same rental income assumptions as in Q1 , with the remaining two-thirds adopting more conservative assumptions. Half of those with unchanged underwriting assumptions were industrial -focused respondents. • CBRE professionals indicate that investors are placing greater importance on certain investment criteria than before the pandemic, particularly tenant credit quality (cited by 85% of respondents), length of remaining lease term (64%) and building occupancy (64%). • Roughly two-thirds of survey respondents believe that investment activity will recover to pre -pandemic levels within one year. C BRE RESEARCH 2 U.S. CAP RATE SURVEY I Q3 2020 MARKET Atla nta Austin Ba lti mo re Boston Charlotte Chicago Dallas/Ft. Worth Denver Houston Minneapolis/St. Paul Nashville N. CA: Oakland N. CA: San Francisco N. CA: San Jose NY: New York City INCREASE CLASS A CBD OFFICE RATES (%) H2 2019 5.50 - 6.50 5.50 - 6.00 7.50 - 8.50 4.25 -5.25 6.00 - 7.00 5.50 - 6.75 6.00 - 7.25 5.25 - 5.75 6.25 - 6.75 5.75 - 6.75 6.00 - 6.50 4.50 - 5.50 4.50 - 5.00 6.00 - 7.00 4.50 - 4.75 V DECREASE SUMMER 2020 CHANGE 6.00 - 7.00 5.75 - 6.25 7.50 - 8.50 4.50 - 5.00 6.25-7.25 6.00 - 7.00 5.25 - 6.25 5.75 - 6.25 6.00-6.50 r 5.75 - 7.00 6.50 - 7.00 4.50-5.00 T 4.25 - 5.00 5.50 - 6.50 4.25 - 4.50 STABLE N/A CLASS A► SUBURBAN OFFICE RATES (%) H2 2019 6.00 - 7.00 6.50 - 7.25 7.50 - 8.50 6.75 - 8.00 6.25 - 7.00 7.25 - 8.25 6.50 - 7.50 6.50 - 7.00 6.50 - 7.00 6.75 - 7.75 6.25 - 7.00 6.00 - 6.50 SUMMER 2020 CHANGE 6.00-7.00 6.75 - 7.50 7.50 - 8.50 6.75 - 8.00 6.75-7.75 7.50 - 8.50 6.00 - 6.75 V 6.75-7.25 6.50 - 7.00 6.75 - 8.00 6.75 - 7.25 6.00 - 6.50 6.00-6.75 5.25-6.50 V MARKET NY: N. New Jersey Orlando Philadelphia Phoenix Portland Raleigh -Durham S. CA: Los Angeles CLASS ACBD OFFICE RATES (%) H2 2019 6.50 - 6.75 6.25 - 6.75 5.75 - 6.75 5.00 - 6.00 6.00 - 6.50 4.50 - 5.50 S. CA: Orange County 4.50 - 5.50 S. FL: Miami Sacramento San Diego Seattle Tampa Washington, D.C. Note: Survey conducted during August 2020. Change is from H2 2019. Changes less than 15 bps considered stable. Source: CBRE Research, September 2020. 4.75 - 6.25 6.00 - 7.00 5.75 - 6.25 4.75-5.25 6.50 - 7.00 5.25 - 5.75 CLASS A SUBURBAN OFFICE RATES (%) SUMMER 2020 CHANGE H2 2019 7.00 - 7.50 7.00-7.25 7.00- 7.50 6.25-6.75 7.00- 7.50 5.75-6.75 6.00- 7.00 5.00 - 6.25 6.25 - 7.50 5.50-6.50 V 6.25- 6.50 4.75-6.00 5.25- 6.75 4.75-6.00 5.50-6.50 4.70 -5.25 V 5.50 - 6.25 6.00-7.25 6.50- 7.00 5.75 - 6.25 6.25 - 6.75 4.75- 5.50 5.75- 6.25 6.50-7.00 7.25-7.75 5.25 -5.75 6.50 - 7.25 SUMMER 2020 CHANGE 7.00 - 7.50 7.50 - 8.00 7.00 - 7.50 5.50 - 6.50 T 6.00 - 7.50 5.50-6.50 5.50 - 7.00 6.00 - 6.75 5.75 - 7.75 6.50 - 7.00 6.25 - 6.75 5.75 - 6.50 7.25 - 7.75 6.50 - 7.25 CBRE RESEARCH 3 U.S. CAP RATE SURVEY 1O3 2020 3/11/2021 Stress Tests Reveal Office Values Could Fall 50% if WFH Sticks I GlobeSt NOT FOR REPRINT $ Click to print or Select 'Print' in your browser menu to print this document. Page printed from: https;//www.globestcom/2021/2021103/11/stress-tests-reveal-office-values-could-fall-50-if-wfh-sticks•/ Stress Tests Reveal Office Values Could Fall 50% if WFH Sticks Fitch ran various stress scenarios to determine how telework would impact demand, rent and net cash flow on 2012-2020 vintage office CMBS transactions. By Les Shaver I March 11, 2021 If work -from -home trends stick after the pandemic, it could cause a permanent decline in demand for space and have a severe impact on property values, according to Fitch Ratings. Fitch ran various stress scenarios to determine how telework would impact demand, rent and net cash flow on 2012-2020 vintage office CMBS transactions. Under scenarios of moderate and severe stresses, it found that 4.4% and zero, respectively, of 114 US CMBS office single- asset/single-borrower bonds maintain their current ratings. Under its moderate stress scenario, Fitch assumes that employees will work remotely 1.5 days per week. That would result in a 20% decline in office workers and a 10% decline in office space demand. Fitch's severe scenario doubles these assumptions. It assumes that rents decline at 1.25 times the reduction in space. In this occurrence, increased vacancies magnify declines in rent levels. Under the moderate and severe scenarios, net cash flow declines 15% and 30%, respectively. Fitch assumes cap rates from its most recent surveillance review of 7.23% on average with these two scenarios. Those rates are significantly higher than the 4.73% appraisal cap rates at loan origination. Using those assumptions, Fitch saw average market -value declines from at -origination appraised values of approximately 44% and 54%, respectively, for moderate and severe scenarios. If those declines occurred, 25% and 55% of investment -grade bonds could potentially fall below investment -grade under the moderate and severe scenarios, respectively. Already, property values fell by 38% on average in Fitch's current rating analysis For comparison, office property values fell approximately 43% during the 2008 Great Recession. They recovered over three years. With a possible secular shift to working from home, values could take a lot longer to recover following this recession. What ultimately determines if values will fall and how much is whether workers return to the office. (https://www.globest.com/2021/03/11 /the- futu re-of-the-office-its-sti I I -tba/) https://www.globest.com/2021/03/11 /stress-tests-reveal-office-values-could-fall-50-if-wfh-sticks/?printer-friendly 1/2 3/11/2021 Stress Tests Reveal Office Values Could Fall 50% if WFH Sticks I GlobeSt In a segment on CNBC's 'Squawk on the Street,' Brett White, Cushman & Wakefield's CEO and executive chairman, said the number of people working from home could double from 5% to 10%. An additional 30% of office workers were allowed to work from home one or two days a week. White thinks that number will jump 50% to 60% after the pandemic. Additionally, 3 million workers lost their jobs in March and April and only 1.8 million have been rehired. Overall, he could see companies with these agile workforces reduce their footprint by 10%, 15% or even 30%. "A lot of employers should and will think of creative ways to use their space more efficiently," White says. "And that's going to be a drag on occupancy.►" Copyright 2021. ALM Media Properties, LLC. All rights reserved. https://www.globest.com/2021/03/11 /stress-tests-reveal-office-values-could-fall-50-if-wfh-sticks/?printer-friendly 2/2 5/11/2021 Denver Office Market Struggles Through Pandemic I GlobeSt NOT FOR REPRINT 44 Click to print or Select 'Print' in your browser menu to print this document. Page printed from: https;//www. globest com/2020/2020/11/04/deriver--office-market-strug►files-through-pandemic/ Denver Office Market Struaales Through Pandemic Leasing volume has fallen to its lowest point in a decade, and more than 1 million sc u nre feet of sublease space has come to the market. By Kelsi Maree Borland I November 04, 2020 The Denver office market has struggled through the pandemic. The latest stats from. 5avills'third quarter report show that leasing activity has fallen by 1 million square feet, the lowest point in a decade, and 1 million square feet of sublease space has come to the market, bringing the total to 4.6 million square feet. In addition, the office vacancy rate in the market has increased to 21.6%, the highest in eight years. "We see the availability rate as a more useful metric, that includes all sublease space and new buildings that are under construction," Rick Schuham, director at the Denver office at Savills, tells GlobeSt.com. "That number for downtown Denver is 27.5% and that is what tenants care about. What are my choices? What can I negotiate a lease on? The vacancy number is relevant for both landlords and investors and that is why our competitors are tied to that metric." In many cases, this is good news for tenants, who have ample options and room for negotiation on lease terms. "I had an out-of-town client that recently came to Denver to look at options that would provide space for 200-500 jobs," says Schuham. "This specific client only wanted to look at sublease space and we had 19 unique locations to view. In many cases, it was suggested that we could write our deal as we saw fit. This availability puts pressure on all categories of space owners both direct to landlord and sublease." Downtown Denver has the highest vacancy rate in the market at 27.5%. In addition, the market has nearly half of the sublease space in the greater market at 2.1 million square feet. Companies across the board are placing sublease space on the market. "There is no limitation on sectors that are experiencing pressure downtown," says Schuham. "Largely it is the energy and tech sectors that are putting their space on the market." Downtown Denver has a high concentration of energy business and technology business, which are driving the sublease supply. In addition, the submarket has several large developments that are delivering downtown mostly unleased. While thevacancy rate in the market has skyrocketed, rents have not meaningfully adjusted yet. In fact, according to the report, overall asking rents increased slightly to $29.83 per square foot from $28.18 per square foot. 'We have seen some adjustments. Concessions are up substantially, and in many cases, rents are already down. Asking rates and taking rates are quite different," says Schuham. "Tenants who have the flexibility to make decisions and are financially capable are in control." There won't likely be a change in these trends through the end of the year. Schuham predicts limited activity. "Only the clear visionaries are making big -picture real estate decisions and they are being handsomely rewarded with long-term low occupancy costs," says Schuham. "We will continue to see more companies kicking the tires for relocating to metropolitan Denver from the coasts and large urban centers across the country. The pandemic has changed everything, not just for decision makers, but more importantly the broader educated skilled workforce. Quality of life and access to the outdoors has never been more important. Colorado checks all the boxes." https://www.globest..com/2020/11/04/denver-office-market-struggles-through-pandemicl?printer-friendly 1/2 7/10/2020 What will happen to office lease rates? - Colorado Real Estate Journal What will happen to office lease rates? By CREJ June 15, 2020 The volume of office leases being signed in Denver is so low that judging the market it difficult, its not fair to say that the market is declining, rising or even staying steady - it s only fair to say that the market has disappeared for the moment. Are office lease rates dropping? David Shirazi Vice president, tenant representation, JLL I get some version of this question every day, from clients and colleagues as well as from friends and family who generally have little interest in the commercial real estate market. It seems like it should be a given, right? Unemployment is sky high, the stock market is down, many companies have not returned to the workplace yet and may not do so for some time, and, to top it off, oil and gas companies are facing unprecedented headwinds. So, have office lease rates in Denver crashed as well? As it sits today, it s not fair to say that the market is declining, rising or even staying steady - it s only fair to say that the market has disappeared for the moment. The market is only as good as the https://crej.com/news/what-will-happen-to-office-(ease-rates/ 1/4 7/10/2020 What will happen to office lease rates? - Colorado Real Estate Journal latest transactions tell us it is, and right now the volume of ofCce leases being signed in Denver is so low that deCning the omarket rateO is just not feasible. What transactions that are being consummated are mostly short-term extensions on existing leases. Landlords and tenants seem to be coming to the table so that both sides can have more time to make long-term leasing decisions. What does history tell us on this topic? You might be surprised at the amount of lag time between a stock market crash and the corresponding decline in Denver ofOce rental rates. After the dot-com bust in 2001, ofOce rates in Denver didnot hit their low for 15 quarters, and they didnot make a full recovery for over seven years. When the economy crashed in 2008, rates did not hit their low for nine quarters and didnot fully recover for eve years. Denver office market performance $30 $25 $22 $19 $14 $21.22 2001: rents fall 24%%o and vacancy climbs to 21.3% 15 23.8% b 29 qtrs •—$16.16► totalvacancy (R) avg asking rent (L) $21.83 -4\ s 20 qtrs $20.11 Rents increased 53% in past 10 years to today's record -high r $22.03 $31.10 2008: rents decline 9% and vacancy reaches 18.4% 22.0% 18.0% 14.0% 10.0% 6.0% $10 a 2.0% 20O0 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 After the dot -corn bust in 2001, ofCce rates in Denver didnot hit their low for 15 quarters and didnot make a full recovery for over seven years. When the economy crashed in 2008, rates did not hit their low for nine quarters and didnot fully recover for Cve years. As of now, there just isnot enough evidence to say how far rates have dropped or how far they will drop, but youad be hard pressed to and someone in the industry who doesnot see rates declining in the coming months. To give some perspective, we need to understand what ultimately drives lease rates down: An increase in vacancy. 'Us only been about 75 days since most of us left our ofCces and started working from home, not enough time for tenants and landlords to really evaluate their situations. Smaller companies still may be enjoying the beneCts of their Paycheck Protection Program loans, and using those funds to pay rent, but that money will run out soon. Some other companies have withheld rent (or have been unable to pay rent), but Gov. Jared Poliso temporary ban on evictions is artiCcially keeping vacancy low for the moment. There is one major indicator that points toward a decline in DenverOs ofCce lease rates 'i the amount of sublease space coming onto the market. Today, we have over 1.5 million sf of ofCce space on the sublease market in the central business district alone. This is more sublease space on the market than weave had for at least 20 years, up from just over 1 million square feet at the beginning of 2020.9 Sublease opportunities traditionally offer tenants the ability to secure a below -market lease rate, and, indeed, most sublease opportunities on the market right now are quoting rates that are below the rate that the building owner is asking for � sometimes far below. The sheer volume of available sublease space is going to force landlords to compete at rates lower than theyod like. From the tenant point of view, there will be good options in the marketplace right now, and youoll probably get a better deal today than pre-COVID-19, but there almost certainly is an advantage for those who can wait a little longer before transacting. Tenants should be keeping an eye on the ototal vacancya Cgures. At the end of the Crst quarter, total vacancy in Denveras CBD was 14%; once that Cgure creeps up to 18% most landlords are going to become signiCcantly more aggressive. https://crej.com/news/what-will-happen-to-office-lease-rates/ 2/4 Adams County Arapahoe County Boulder County Broomfield County Denver County Douglas County Eagle County Jefferson County Larimer County Mesa County Routt County Weld County Colorado Assessor's Study of the effects of the Covid-19 Pandemic on Non -Residential Property Valuation Executive Summary Introduction Covid-19 was declared a global health crisis by the World Health Organization on March 11, 2020. On March 11, 2020, Colorado Governor Jared Polls reacted to the pandemic by declaring a Disaster Emergency due to the presence of Covid-19 in Colorado (D 2020-003). The Governor and CDPHE subsequently issued orders closing all public gathering places such as bars, restaurants, theaters, gymnasiums, casinos, ski resorts, and public/private elementary and secondary schools statewide. On March 22, 2020, the Governor ordered all non -essential Colorado employers to reduce their in -person work forces to 50%. The Governor's Stay at Home Order (D 2020-017) was issued on March 25, 2020 and was immediately followed by Public Health Order 20-24 from the Colorado Department of Public Health and Environment (CDPHE)I These orders mandated Coloradans to stay at home, addressed self -isolation measures, limitations on public/private outdoor gatherings, business restrictions, travel restrictions, and provided social distancing requirements. The Covid-19 pandemic led to substantial economic, social and market occurrences, including: • Disaster declarations were issued at the federal, state and local levels • A statewide stay at home order was issued by the Governor of Colorado, along with many related Executive Orders that had significant social and economic impacts • Downturns were observed in some -but not all commercial sectors • Loss and/reductions in rental income for some commercial properties Prior to the March shutdown, the Colorado economy was exceptionally healthy, and outperforming most of the Country, however beginning in April it followed the rest of the United States into the pandemic recession. These events made it clear to County Assessors in Colorado that potential impact on commercial real estate values merited investigation. Property valuation and assessment for ad valorem purposes varies from state to state, and on an international basis, from country to country. In the State of Colorado, County Assessors value all real property in their jurisdictions every two years in odd numbered years. This requirement is dictated by Colorado Statute, along with methodology by which this is to be accomplished. Real property is valued as of a specific date, known as the "valuation date", which is always June 30th of the year preceding the reappraisal, and is June 30, 2020 for the upcoming 2021 general reassessment. Assessors are to consider data from the preceding 18 months, known as the "study period", and rely heavily on transactions of real property to perform their valuation analysis. This said, it is important to acknowledge that most Assessors avail themselves of the statutory option to increase the study period in six-month increments for a total 24 -month study period. According to the State Constitution, only sales of similar properties can be used to value residential property, however non-residential property valuation is valued with due consideration given to the Cost, Sales Comparison, and Income approaches to value. In addition, Assessors are required by law to adjust all property sales to the June 30th valuation date, which is commonly known as "time trending". This is accomplished through a thorough review of market evidence, particularly sales activity. As it sounds, sale prices are adjusted up from the date of sale to account for an appreciating market and adjusted down if the market is declining as of the valuation date. This time trending step is critical to the valuation process and is specifically analyzed as part of the annual State Board of Equalization audit process to ensure accurate and uniform valuations throughout Colorado. The timing of Covid-19 global pandemic caused great concern to Colorado Assessors with respect to time trending --or adjusting sales. Sales activity was occurring with a typical volume of transactions throughout Colorado until the Covid-19 crisis emerged in March 2020. While a significant decrease in residential transactions was observed, commercial real estate transactions fundamentally ceased to occur between the onset of the pandemic in March, and the valuation date of June 30, 2020. The primary concern of the assessment community is that without transactions between the Covid-19 shutdown and the valuation date, it is very difficult to determine what, if any, impact the pandemic had on commercial property values as of the valuation date. In a proactive effort to determine the impacts of the pandemic on the commercial real estate market in Colorado, a group of County Assessors came together and dedicated staff to conduct a comprehensive study on six commercial real estate sub -markets: Office; Retail; Warehouse; Apartments; Commercial Condominiums; and Lodging. Additionally, it was important for each team of Commercial Appraisers to identify sub -markets that required separate research and analysis and provide suitable recommendations. This report is the result of that exhaustive effort and contains specific recommendations and methodologies where adjustment may be appropriate to commercial property values for the 2021 revaluation. We are grateful for the efforts of the County Assessors and Appraisers who have contributed to this important endeavor. This will have several outcomes, the greatest being a consistency in our recognition of the pandemic on commercial property valuation for tax years 2021 and 2022. This effort has been unprecedented in the history of the State of Colorado, and we credit those leaders and future leaders for the knowledge, skill and experience they have lent to this study. Executive Summary The following information is summarized findings from each of the six study groups. Recommendations are general in nature and specific local market information should always be relied on most heavily. A property that sold prior to the start of the pandemic may not have sold for that same amount on June 30, 2020. Therefore, a sale that occurred before the pandemic may need an adjustment to account for changes in market conditions that were present on the date of value. Sales data is very limited, and it is difficult to extract reliable market wide conclusions from such a small sample. The various aspects of the income approach did provide some indication of changes in the market that could be used to calculate an adjustment to the pre -pandemic sales. The recommended range of impact is summarized below. Each county should review their individual markets and determine how it applies to them. Rental Rates Concessions Vacancy Collection Loss Expenses Cap Rates No adjustment recommended. Depends on the individual market. In markets where 4-6 months free rent on a 64 to 66 - month lease are common this represents a 6% to 9% reduction in revenue. Depends on the individual market. Most markets saw 0.7-2.0 increase in vacancy. Other markets saw no change. No adjustment recommended. An increase of 3-5% in expenses is supported. This may also be reported as $0.25-$0.50 per square foot. Depends on the individual market. An adjustment of 0-3% is supported. Once a county has determined what adjustments apply to their markets, they should apply these adjustments to their base period sales for an adjusted sales price reflective of the market as of 6/30/2020. This adjusted sales price could then be used to support market values. Retail 7 Small Retail, Restaurants & Entertainment Uses A Covid-19 adjustment of approximately -11% should be made to the estimated income values for sit-down restaurants, bars, taverns, and entertainment venues. An adjustment for salons, barbershops, daycares, and fitness centers may also be appropriate when county -specific data reflects a measurable decrease in the income generating potential for these property types. Anchored & Non -Anchored Shopping Centers The most reliable data available for both the pre-Covid and post-Covid timeframes is most relevant to the Income Approach method of valuation, which is also the most common method used by market participants for Group B properties. The movement of lease, vacancy and cap rates is slight as of the date of valuation. As of the date of valuation, lease rates were slightly decreasing, vacancy rates were slightly increasing, and capitalization rates had increased approximately 50 basis points. The combination of these factors potentially results in slight decreases in value for Group B properties. While a common myth is that retail property values plunged as impacted by Covid-19, the data does not support a drastic decrease in Group B retail property values as of June 30, 2020. In terms of market sales activity and comparable sales data, this data also does not support a drastic decrease in retail property values. Sales data shows that sale prices and unit prices per square foot did not decrease on an overall basis. Investors continue to look for properties to purchase; although it is noted that the pool of potential buyers is smaller as lending requirements are more stringent, which is offset by fewer properties available for sale. The drop in the number of sales during the Covid-19 period is not attributed to decreasing property values, but rather to the uncertainty of market conditions moving forward. This is illustrated in the slight increase in capitalization rates reflecting the perceived inherent risk of future unknowns regarding Covid-19, including the unknown time frame when it will no longer negatively impact social and business activity. Overall, our analysis found the following: • Slight downward movement of lease and vacancy rates • Slight increase of capitalization rates around 50 basis points • No measurable change in sales prices or unit prices per square foot We recommend as an alternative to paired sales analysis for pre -pandemic and post -pandemic sales that counties look at changes in the components of their submarket Income Approach parameters as a method of adjusting pre -pandemic study period sales. Big Box Retail and Regional Malls Big Box retailers were generally considered Critical businesses and did not close during the pandemic and by all accounts appear to have fared well through the study period. Thus, in general, we do not believe an adjustment to value is merited due to the pandemic. Nevertheless, there may be some properties within this category► that were not considered critical that specifically experienced hardships related to the closure, we recommend that counties consider these properties during the protest period based upon the specific information provided by the property owner during the appeal process. For Regional Malls we recommend focusing on the key components of the Income and/or Cost Approaches for the 2021 re -appraisal. Since the Income Approach parameters are highly variable from mall to mall, we believe that the valuation analyses should be based on the geographic and economic climate of each property. Special attention should be given to vacancy/collection losses and capitalization rates when using the Income Approach and determining if economic obsolescence is apparent in the marketplace when evaluating depreciation within the context of the Cost Approach. Warehouse First, regional sales data was gathered and combined from the participating counties to explore trends over the base period, and specifically, to identify any sudden changes after the pandemic started in March 2020. While there was a precipitous drop in sales volume, the sales rebounded in June 2020 to a level consistent with the overall trend observed from most of the base period data, from July 2018 to Feb 2020. Further stratification of this regional data to small and large warehouse properties, defined by building size, produced the same results as the entire data file. Overall, this analysis provided no basis for an adjustment based on warehouse sales. The next two research and analysis sections focused on the variables pertinent to the income approach to value, cap rates, vacancy, and rent rates. To examine these variables, data was collected from CoStar and available research reports from national brokerage firms. Like the sales analysis, data was analyzed over the base period to measure trends occurring pre and post pandemic, as well as any abrupt changes after the pandemic began. Data from these analyses provided no clear indication of an immediate or measurable change directly related to the pandemic. To summarize, no adjustment specific to the impact of the Covid-19 pandemic is recommended for the warehouse subclass from this report. It is recommended that each county verify the results of this report with county -specific data to validate and confirm similar conclusions. Apartments The Covid-19 pandemic's effect on values of apartments in Colorado was minimal as of the appraisal date, June 30th, 2020. With a moratorium on evictions and high unemployment, one would expect values to decline more severely. Government assistance to typical renters is a possible explanation for the minimal effect on values. On March 20, 2020, the Governor's executive order D2020-012 allocated $3 million from the Disaster Emergency Fund to provide short-term rental and mortgage assistance to low-income households facing financial hardship due to Covid-19. The US Congress passed H.R. 748, the CARES act, which provided an additional 13 weeks of unemployment benefits through December 31, 2020, and an additional $600 per week per individual. The benefit included workers not traditionally eligible for unemployment benefits (self- employed, independent contractors, etc.) who were unable to work because of Covid-19 issues. In addition, the CARES act created an advanced tax refund of $1,200 per individual, $2,400 per couple, and an additional $500 per child. These measures appeared to allow tenants to pay rents through June 30th, 2020 and in turn keep apartment values from plummeting. On April 24th, the Paycheck Protection Program and Health Care Enhancement Act became law which provided additional lending authority► for the Small Business Administration to respond to payroll needs created by the Covid-19 outbreak. Apartments are not out of the woods, in fact the modest decline in some areas of Colorado is indicative of the uncertainty looming due to eviction moratoriums and the eventual expiration of government assistance. Additionally, there are trends beginning to emerge including tenants migrating from downtown Denver to more affordable areas, teleworkers needing apartments with office space, and multiple households are coalescing which is creating a need for larger apartments. Commercial Condominiums In reviewing all of the data in the Multi -County study, the main conclusion is that commercial condominiums, regardless of type (Industrial, Office, Retail and Warehouse), had an increase in value from the previous base period; with the pandemic having little if any effect upon the property class value. While the volume of sales in the last quarter of the base period declined once the pandemic and lock down were in full effect, caution must be used in drawing conclusions about the impact of the pandemic. The majority of sales that did occur followed similar value increases and trends from the previous 7 quarters, with values increasing over the two- year data collection period as a whole. Post-Covid trends in average sales prices for all property types vary between counties with Mesa, Weld, Larimer and Douglas showing a flattening out after March 2020, while Arapahoe, Eagle and Boulder Counties show ongoing growth in sales prices. Though some county condominium sales didn't increase in value as much as some of the other counties surveyed, a distinct rise in sales prices by June 30, 2020 was clear and evident, and followed the study's increasing trend of value overall for commercial condominiums through the two- year data collection period. As a check of reasonableness, a review of post study period sales indicates that there is a continuation of the increasing trend in sales prices and sale price per square foot in the surveyed counties. Lodging The adjustments summarized below provide a range of typical value adjustments resulting from the pandemic for three stratifications of lodging properties. The notion here is that hotel owners experienced this loss in value from December 2019 to June 2020 and does not reflect a reduction in the Assessor's Actual Value from the prior reassessment (June 30, 2018). To summarize, value reductions are more intensive in convention hotels and other group travel business properties. In addition, some of the typically strongest leisure travel properties have experienced the greatest value loss resulting from the collapse in the travel industry. Conversely, economy and midscale properties located in rural, mountain, suburban and drive -to destinations did not experience the same drop in average daily rate (ADR), occupancy, or revenue per available room (RevPar), and from a forward -looking point of view, are believed to have a greater chance of recovering in a shorter timeframe. The simple fact that lodging property performance is so directly tied to location, even without a pandemic in play, requires a specific analysis of the submarkets in each county. Lodging property performance has always been highly dependent on location. As a result, Colorado Assessors must evaluate their local markets to determine the specific effects of the pandemic on their market of hotels. Scale Location Service Adjustment Group A Group B Economy, Midscale Rural, Mountain, Suburban, Drive -to Limited, Extended 0-20% Upper Midscale, Upscale Rural, Mountain, Suburban, Drive -to Limited, Select, Extended 10-30% Group C Upper Upscale, Luxury Urban, Large City, CBD, Fly -to destinations Full Service, Convention 20-30% CBRE MARKETVIEW DENVER OFFICE Q 1 2021 Vacancy reaches near record high one year into the pandemic Vacancy Rate 16.8% Avenge [.ease Rate $29.43 FSG • Metro Denver posted 954,000 sq. ft, of negative absorption in Q1 2021— the fourth straight quarter with negative activity. • The average direct asking lease rate increased $0.32 quarter -over -quarter to $29.43 per sq. ft. FSG. • Total vacancy reached the highest level in nearly 10 years, increasing 87 bps quarter -over -quarter to 16.8%, • Sublease availability declined by 3% quarter -over -quarter to 4.6 million sq. ft., but is still up 81% from the onset of the pandemic in Q1 2020. • 2.4 million sq. ft. was under construction at the end of Q1 2021. • Investment sales activity improved in Q1 2021, recording $393 million in transactions, Net Absorption (954,274) SF 0 Under Construction 0 Completions 2.4 MSF 210,169 SF *Arrotivs indicate change from previous quarter. MARKET SUMMARY The Denver office market saw continued softening in the first quarter of 2021, posting negative net absorption of 954,274 sq. ft. After ten years of expansion, this is the fourth straight quarter of negative net absorption. Class B properties drove the bulk of this activity, recording over 700,000 sq. ft of negative net absorption. In line with absorption, total vacancy also grew 87 bps from last quarter to 16.8%, the highest rate seen since 2010. For the first time in four quarters, sublease availability decreased in Q1 2021 to 4.6 millionsq. ft. on the market. Although this was a decline from last quarter, the available sublease volume is still 81% higher than the onset of the COVID-19 pandemic in Q1 2020. Energy users continued to hold the lion's share of sublease availability downtown, while telecom companies led activity in the Southeast. The average direct asking lease rate continued to grow, reaching $29,43 per sq. ft. full service gross (FSG). Construction starts have slowed over the past year due to the uncertainty surrounding the pandemic. As of Q1 2021_, 2.4 million sq. ft. of office space was under construction with one 210,000-sq.-ft adaptive reuse project delivering this quarter. Q1 2021 CBRE Research O 2021 CBRE, Inc. 1 CBRE MARKETVIEW DENVER OFFICE f O1 2021 Figure 1: Denver Market Statistics Submarket Rentable Area (SF) Direct Vacancy Rote (%) Availability Rate %) Sublease Availability (SF) Under Construction Average SF) Lease Rote ($/SF/YR FSG) Net Absorption SF Aurora Boulder Capitol Hill Cherry Creek. Colorado BIvd/Midtovrn Downtown Longmont North Northeast Northwest River North Southeast Southwest West Hampden/Alameda Metro Denver 5,890,941 6,959,655 2,374,643 2,669,665 6,477,508 29,466,136 850,557 3,075,948 1,093,650 8,188,756 2,043,385 36,576,405 5,698,216 6,735,813 1,030,097 119,130/435 Source: CORE Research, 01 2021. 12.6 13.2 7.4 13.5 12.3 18.9 15.3 19.6 15.7 27.1 7.0 8.1 12.9 15,4 15.9 19.7 12.5 22.9 23.4 29.7 14.8 25.4 16.7 15.8 13,0 18.7 16.3 20.1 14.6 23.2 18.8 22.1 OFFICE -USING EMPLOYMENT Office -using employment -including jobs in the information, financial activities, professional and business services, and government sectors declined by 2.5% in 2020, shedding 18,500 jobs. Although all office -using sectors recorded losses, the government and professional and business services sectors were hit the hardest. On a positive note, office -using employment is improving with. February jobs 2.3% higher than the trough in July of last year. Additionally, the office -using sectors have been less impacted than other industries and are expected to recover faster. The unemployment rate for metro Denver sat at 6.8% in February 2021, just above the U.S. rate of 6.2%. In comparison, unemployment was at 2.4% in February 2020 before peaking at 12.1% in April 2020. 42,098 333,121 290,000 35,533 62,342 11,986 127,208 1,861,693 4,613 41,345 64,000 62,000 1,192,681 25,058 191,399 186,000 52,779 1,708,781 549,500 28,762 133,813 6,244 4,579,375 2,431,581 18.28 32.64 29.12 36.45 26.35 35.46 21.36 23.61 19.83 28.24 42.00 27.21 25.61 24.18 17.28 29.43 Figure 2: Office -Using Employment Growth Jobs Added (000's) 30 20 10 0 -10 - 20 - 30 - 40 • Government Financial Activities (27,313) (65,434) (14,438) 20,938 (88,752) (400, 780) (5,599) 1,564 3,505 (19,845) (32,169) (300,912) 25,395 (33,220) (17,214) (954,274) 2015 2016 2017 2018 2019 2020 YoY'iT0 Feb 2021 • Professional & Business Services ■ Information Source: U.S. Bureau of Labor Statistics, February 2021. O1 2021 MIME Research C� 2021 CBRE, anc. 2 CBRE MARKETVIEW DENVER OFFICE Q1 2021 Figure 3: Total Vacancy and Lease Rate Vacancy (%) 20 18 16 14 12 10 - 8 cy aS a serespp de 2010 2011 2012 2013 2014 2015 Source: CORE Research, 012021, VACANCY Total Vacancy Rate Total vacancy reached 16.8% in Q1 2021, growing 87 bps from Q4 2020 and a staggering 374 uptick year -over -year. This was the highest vacancy rate recorded in metro Denver since Q4 2010. Direct vacancy increased to 14.6%, a 297 bps spike since Q1 2020. Direct vacancy Downtown increased 133 bps quarter -over -quarter to 15.7%, up 134 bps on the year. Direct vacancy in the Southeast increased 105 bps from last quarter and 351 bps year -over - year to 14.8%. SUBLEASE AVAILABILITY Growth in sublease availability metrowide stabilized in Q1 2021, decreasing 120,000 sq. ft. or 2.6% quarter -over -quarter to 4.6 million sq. ft, available. Although a decrease from last quarter, sublease availability is still up 81.3% from the onset of the pandemic one year ago. Class A properties saw the greatest amount of sublease availability, ending the quarter at 2.4 million sq. ft. available metrowide, a 60.1% increase year -over - year. Class B properties registered the largest uptick in sublease space, increasing 112.1% from last year to 2.1 million sq. ft. available. Downtown Denver, which holds the largest share of availability, decreased marginally to 1.9 million sq. ft. The Southeast saw a slight uptick from last quarter, ending Q1 2021 at 1.7 million sq. ft. Direct Asking Lease Rate ($) 40 ag. ala as ell 2016 2017 2018 2019 Direct Asking Lease Rate Figure 4: Sublease Availability Sublease Available Sq. Ft (Millions) 5.0 4.0 3.0 2.0 1.0 0.0 2020 012021 35 30 25 -- 20 012020 02 2020 03 2020 04 2020 012021 • Downtown Sublease Available • Southeast Sublease Available • Other Sublease Available Source: ORE Research, 01 2021. 15 10 1 20211 CBRE Research © 2021 CBRE, Inc. 3 CBREMARKETVIEW DENVER OFFICE Q1 2021 CONSTRUCTION 2.4 million sq. ft. of office product was underway in Q1 2021. Speculative (spec) construction totaled nearly 1.3 million sq. ft. - 69.4% of the total development footprint. Overall, downtown projects totaled 1.2 million sq. ft. (48.4%) and suburban construction totaled 1.3 million sq. ft. (51.6%) of all development activity. The Link, a 210,000-sq.-ft. adaptive reuse project located downtown delivered this quarter. The building had no preleasing upon completion. Of the 1.2 million sq. ft. of projects underway downtown, notable spec projects include Block 162 (595,000 sq. ft.) in the raid-CBD micromarket, Market Station (95,130 sq. ft.) in Skyline Urban Renewal and McGregor Square (208,000 sq. ft.) in Lower Downtown. All three of these projects are expected tocomplete over the next year. Preleasing in downtown projects under construction has increased in recent months with 20.6% of projects precommitted in Q1 2021. In the suburban submarkets, notable projects include 240 Saint Paul St (68,400 sq. ft., Cherry Creek), Boulder Commons Phase 11(52,000 sq. ft., Boulder), REVE Boulder (118,000 sq. ft., Boulder) and the headquarters for Vectra Bank (99,500 sq. ft., Southeast). Figure 5: Speculative Preleosed Construction 1.7MSF Speculative Under Construction 69.4% 30.6% ■ Preleosed Sq. Ft. a Available Sq. Et. Source: CBRE Research, 01 2021. Figure 6: Construction, Net Absorption & Direct Vacancy Net Absorption & Construction (MS F) 6 5 4 3 2 1 0 -1 -2 2016 2017 2018 2019 2020 01 2021 Under Construction Source: CBRE Research, 012021. YTD Absorption Direct Vacancy Rate (%)8 I Direct Vacancy Rate 15 12 9 6 3 0 1O i 2021 CBRE keseyunn}� © 2021 CBRE, inc. 4 CBRE MARKETVIEW DENVER OFFICE I Q 1 2021 NET ABSORPTION Metro Denver posted negative 954,000 sq. ft. of net absorption in Q1 2021, the fourth consecutive quarter of negative activity. Class B properties drove this activity, positing 706,000 sq. ft. of net absorption. Class C buildings followed with 150,000 sq. ft. of negative net absorption and Class A properties registered negative 116,000 sq. ft. of net absorption. Activity was driven by contractions taking place downtown combined with a number of buildings that were formerly occupied by owner/users hitting the market for lease. Downtown Denver posted negative 441,000 sq. ft. of net absorption and the Southeast recorded negative 301,000 sq. ft. of net absorption. LEASING ACTIVITY Over 620,000 sq. ft. was transacted in Q1 2021, making the rolling four quarter volume 3.0 million sq. ft. This represented a 57% decrease in volume since the onset of the pandemic last year as many companies are still reevaluating future space requirements. Leasing activity was proportionally dispersed among industries over the past year. The technology sector continued to lead activity with 408,000 sq. ft. transacted, narrowly edging out business services companies, which signed for 406,000 sq. ft. Aerospace & Defense users followed with 367,000 sq. ft. Legal users rounded out the top industries, leasing 366,000 sq. ft. over the past year. Notable leases signed in Downtown Denver in Q1 2021 included: Sherman & Howard inking 59,000 sq. ft. at Block 162, Akerman taking 22,000 sq. ft. at 1900 16th St and Crispin Porter Bogusky leasing 18,000 sq. ft. at McGregor Square. The Northwest submarket saw a couple of sizable leases between Nuvasive claiming 28,000 sq. ft. at 12101 Airport Way and inovonics taking 24,000 sq. ft. at 11000 Westmoor Cir. Figure 7: Net Absorption vs. Lease Rate Net Absorption (000's) 4,000 3,000 2,000 1,000 0 - 1,000 - 2,000 Direct Asking Lease Rate ($) 30 2016 2017 2018 2019 2020 2021 a 01 Q2 03 04 YID Total Asking Lease Rote Source: CBRE Research, 01 2021. Figure 8: Leasing Activity by Industry Type (02 2020-01 2021) • Technology • Aerospace & Defense a Financial Services n Health Core • Government & Non -profits Other ■ Creative Industries Source: CBRE Research, 01 2021. • Business Services ■ Legal Manufocturing & Life Sciences • Energy Insurance Telecornmunico uns 29 28 27 26 25 24 23 O11 2021 CURE Research C? 2021 CBRE, Inc. 5 CBRE MARKETVIEW DENVER OFFICE I O1 2021 AVERAGE ASKING LEASE RATES Despite the economic uncertainty, the direct asking lease rate for the metro Denver area continued to increase in Q1 2021, reaching $29.43 per sq. ft. FSG, up $0.32 quarter -over -quarter and up $0.60 from Q1 2020. The spike in rates is attributed to newly constructed space added to the market at premium rates coupled with landlords electing to increase concessions and incentives in lieu of reducing asking rates. Class A asking rates increased $0.66 from Q4 2020 to $32.55 per seq. ft. FSG in Q1 2021. Asking rates for Class B assets rose $0.20 quarter -over -quarter to $28.46 per sq. ft. FSG. Adversely, asking rates in. Class C buildings decreased $0.65 from last quarter to $22.90 per sq. ft. FSG, further demonstrating the flight to quality occurring amid this recession brought on by the pandemic. The direct asking rate in downtown Denver increased $0,30 to $35.46 per sq. ft. quarter -over -quarter. The Southeast submarket recorded saw a $0.06 uptick in asking rates, ending Q1 2021 at $27.21 per sq. ft. INVESTMENT TRENDS The office investment sales activity in metro Denver continued to strengthen in the first quarter of 2021_, recording a volume of $392.7 million across eleven transactions for an average price per sq. ft. of $238.50. The Northwest and Boulder submarkets saw a bulk of the investment activity this quarter, accounting for six of the transactions or nearly one-third of the entire volume. Even though office sales activity has improved over the past couple of quarters, the volume recorded in Qi 2021 was still down 52.6% year -over -year. Notable sales in Qi 2021 included the trade of 4600 S Syracuse in the Southeast for $69.3 million ($288 per sq. ft.) to Miller Global Properties, INOVA Dry Creek 2 also located in the Southeast sold for $63.2 million ($284 per sq. ft.) to Libitzky Property Companies and ATRIA in the Northwest transacted for $50.3 million ($320 per sq. ft.) to Kennedy Wilson. Figure 9: Average Asking Lease Rale Average Direct Asking Lease Rate (S) 34 32 30 28 26 24 22 20 - — •-a- re' arareeranraMmealtat Sire'. alliMar ems ad 2016 2017 2018 2019 2020 012021 Class A NIS Class B Direct Asking Lease Rate Source: CBRE Research, 01 2021. Figure 10: Lease Rate vs. Availability AvailabilityRate (%) 25 20 15 10 5 0 02 2020 032020 Direct Availability Rate e► Direct Asking base Rate Source: CBRE Research, 012021. Figure ll: Investment Sales Investment Sales (S100 Millions) 10.0 8.0 6.0 4.0 2.0 0.0 Average Asking Lease Rate (S)4 36 32 28 24 20 04 2020 01 2021 Sublease Availability Rate Sublease Asking lease Rate Price per Sq. Ft (S) 400 300 200 100 WM 01 2020 02 2020 03 2020 04 2020 01 2021 aim Suburban Downtown )Metro Average Price Per Sq. Ft. Source: (BRE Research, 012021. ��......�_ sra.aa.. t._ Qi 6,1 2 1 CHRK Research © 2021 CBRE, Inc. 6 CBRE MARKETVIEW DENVER OFFICE O1 2021 CONTACTS LAYNE VOORHEES Research Analyst +1 303 583 2016 layne.voorheescacbre.co m TAYLOR KNABE Research Analyst +1 303 628 1788 taylor.knabeoaU cbre.c cam SUE BELLE Associate Research Director +1 303 628 1760 sue. Belle cbre.com To learn more about CBRE Research or to access additional research reports, please visit the Global Research Gateway at www.cbre.comf researchgateway MARKET OUTLOOK The Denver office market continued to see softening fundamentals in Q1 2021, following multiple years of robust expansion. The market is realizing the distresses of the recession brought on by the COVID-19 pandemic as negative net absorption and heightened sublease availability all point to a continued slowdown. Oncoming new supply and continued weakened demand are expected to put persistent upward pressure on vacancy. Despite the weakening fundamentals, landlords have not decreased asking rates, opting instead to offer increased concessions and incentives to attract occupiers. Looking forward into 2021, widespread vaccinations and stimulus may enable economic stabilization by mid -year, Denver remains a market best poised to recover from this recession due to the its favorable pricing, diverse industry mix, highly educated labor pool and quality of life. CBRE OFFICES DOWNTOWN DENVER 1225 17th Street, Suite 3200 Denver, CO 80202 DENVER TECH CENTER 5455 Landmark Place, Suite C102 Greenwood Village, CO 80111 BOULDER 1805 11th St, Unit A Boulder, CO 80302 COLORADO SPRINGS 121 South Tejon Street, Suite 1111 Colorado Springs, CO 80903 FORT COLLINS 3003 East Harmony Road, Suite 300 Fort Collins, CO 80528 Disclaimer: Information contained herein, including projections, has been obtained from sources believed to be reliable. While we do not doubt its accuracy, we hove not verified it and make no guarantee, warranty or representation about it It is your responsibility to confirm independently its accuracy and completeness. This information is presented exclusively for use by (BRE clients and professionals and all rights to the material ore'reserved and cannot be reproduced without prior written permission of (BRE. CBRE MARKETVI EW Denver Office, Q2 2020 Market activity stalls as sublease availability rises Total Vacancy Rate 0 Lease Rate 13.6% $28.81 KG 0 Net Absorption (84,706) sq. ft. Under Construction0 3.7 million sq. ft. Completions 0 sq. ft. Figure 1: Total Vacancy and Lease Rate Total Vacancy (%) 20 18 16 14 12 10 *Arrows indicate change from previous quarter. Direct Asking Lease Rate (5) 40 • • sews so gh• •-nr. car •-••:, nal in in IC +SC- if iretC Celt riFor es Etta tor C. toll .f. _ - t� K.v �_ . .o -IN. neK, .a..,._...{ ..o..n—...near .e.....ilai......r.ago' -.Aft C c-eee- _�......-re_e.W..r.. ,.. x_ _ _ W.W_.._....ea' MIMIOn 4Y.1.a t/vPf..+M..-.+'snfu.n .a 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 02 2020 Total Vacancy Rate Source: CBRE Research, 02 2020. • Metro Denver posted 84,706 sq. ft. of negative net absorption in Q2 2020 —the first time in 13 quarters the market has seen negative absorption activity. ▪ The average direct asking lease rate remained stable at $28.81 per sq. ft. FSG. • Total vacancy increased 55 bps quarter - over -quarter to 13.6%. ▪ Sublease availability increased 33.3% quarter -over -quarter to 3.4 million sq. ft. This uptick drove total availability to 17.8%, a 91 bps increase from last quarter. • The total construction volume reached 3.7 million sq. ft., up 49.8% year -over -year. Direct Asking Lease Rote 35 30 25 20 15 10 The Denver office market felt the impact of the recession brought on by the COVJD-19 pandemic, posting negative net absorption of 84,706 sq. ft. in Q2 2020. Class A buildings recorded positive net absorption of 113,241 sq. ft., while both Class B and Class C properties posted negative net absorption of 134,552 sq. ft. and 64,395 sq. ft. respectively. Despite the negative absorption activity this quarter, the year- to-date absorption remained positive at 330,649 sq. ft. Total availability increased 91 basis points (bps) to 17.8%, driven by the 33.3% increase in available sublease space this quarter. Total vacancy climbed 55 bps to 13.6%. The direct average asking lease rate was steady quarter -over -quarter, decreasing $0.01 to $28.81 per sq. ft. full service gross (FSG), The Denver market saw no completions in Q2 2020 but construction activity remained strong with 3,7 million sq. ft. currently underway. O2 2020 CBRE Research 2020 CBRE, Inc. I CBRE MARKETVIEW DENVER OFFICE Figure 2: Denver Market Statistics Su bra rket Net Rentable Area (N RA) (Sq. Ft.) Direct Vacancy Rote e/%) Net Absorption (Sq. Ft.) Under Construction (Sq. Ft.) Average FSG Lease Rate ($NSF/Yr) Availability Rate (%) Sublease Availability (Sq. Ft.) Aurora Boulder Capitol Hill Cherry Creek Colorado Blvd/Midtown Downtown Longmont North Northeast Northwest River Noah Southeast Southwest West West Hampden/Alarnedn Metro Denver 5,890,941 6,503,852 2,374,643 2,634,917 6,430,508 29,405,593 935,425 2,983,078 1,021,245 8,230,236 1,732,414 36,353,004 5,482,276 6,946,824 1,262,833 118,187,789 Source: CBRE Research, 02 2020. 9.7 7.3 7.7 9.7 12.6 14.7 3.4 10,6 13.7 12.9 11.6 12.3 8.8 12.2 10.4 12.1 530 (9,679) (52,364) (26,307) (47,548) (143,228) (7,680) 19,910 (10,487) 261,446 10,910 (26,952) (1,347) (36,919) (14,991) (84,706) ECONOMIC/EMPLOYMENT Office -using employment including jobs in the information, financial activities, professional and business services, and government sectors accounted for roughly two-thirds of all jobs created in the metro Denver area (Denver -Aurora and Boulder MSAs) through May 2020. These sectors added 7,000 jobs on an average year-to-date basis of the 11,400 jobs created overall in the same period. Job growth in these sectors was stunted in April and May as stay-at-home orders resulting from the COVID-19 pandemic shuttered businesses, but strong growth in the first three months of the year buoyed the year-to-date average. Professional and business services experienced the largest growth of 2%, an additional 6,300 new jobs, the most of all office -using industries in absolute terms. The metro area's unemployment rate rose to 10,2% in May, driven by pandemic -related job losses that are mostly expected to be temporary, below that of the U,S,, which clocked in at 13.3%, 0 349,226 62,342 64,000 1,476,571 212,322 353,333 1,154,811 low 3,734,605 18.50 33.35 28.73 36.58 26.70 35.00 21.82 19.86 20.95 27.73 36.20 26.87 28.73 24.14 15.36 28.81 Figure 3: Office -Using Employment Growth Jobs Added (000's) 20 15 10 5 0 -5 14.0 15.8 9.9 12.4 16.5 20.4 5.8 15,614 254,908 41,657 29,945 30,943 1,689,066 13.2 50,314 18.9 19.1 131,685 11.1 14,951 18.5 973,011 21.2 10,824 16.8 124,157 10.5 17.8 3,367,075 2016 2017 2018 2019 YoYYTD May ■ Government # Financial Activities 2020 ■ Professional & Business Services ■ information *Employment figures based on overage year-to-date comparisons from January, to May 2019 and 2020. Source: U.S. Bureau of Labor Statistics, May 2020. Q2 2020 CBRE Research O 2020 CBRE, Inc. I 2 CBRE MARKETVIEW DENVER OFFICE CONSTRUCTION Development activity in metro Denver reached over 3.7 million sq. ft. in Q2 2020, Speculative (spec) office construction totaled 3.0 million sq. ft. — 81.4% of the total development footprint. Overall, Downtown projects totaled 1.5 million sq. ft. (39,5%) and suburban construction totaled 2,3 million sq. ft. (60.5%) of all development activity. Two projects broke ground this quarter, the 64,000-sq,-ft. office building at 240 St. Paul St in Cherry Creek and the 43,500-sq.-ft. adaptive reuse project, Emily's Office in the Downtown submarket. There were no office completions in metro Denver this quarter, }gut several projects are slated to deliver in the coming months. Of the 1.4 million sq. ft. of office buildings underway Downtown, spec projects include Block 162 (595,000 sq. ft.), One Platte (250,400 sq. ft.), The Link (224,000 sq. ft.), McGregor Square (208,400 sq. ft.) and Market Station (95,400 sq. ft.). just 7.5% of the spec office projects were preleased at quarter end. In the suburban submarkets, notable builds are 6900 Layton (Southeast, 370,800 sq. ft.), 4899 S Quebec St (Southeast, 334,000 sq. ft.), Rev360 (RiNo, 130,000 sq. ft.) and REVE Boulder (Boulder, 118,000 sq. ft.). At the end of Q2 2020, 21.0% of spec projects metrowide were preleased. LEASING ACTIVITY The technology sector continued to lead leasing activity with 1.4 million sq. ft., or 23.5% leased over the past four quarters. The financial services industry followed, representing 11.8% of the total volume, Activity was fueled by SurveyGizmo's sublease at 168 Centennial Pkwy in Louisville for 26,500 sq. ft., Agility Recovery Solutions' 22,000-sq.- ft. lease at 17th Street Plaza downtown and a 20,200 sq. ft. deal by The Trade Desk at 1595 Wynkoop St also located downtown. Another notable transaction was NGL Energy Partners' lease at 9th & Colorado for 48,000 sq. ft., in the Colorado Blvd submarket. Other significant deals this quarter included Somalogic's renewal for 30,900 sq. ft. at 2945 Wilderness PI in Boulder, Kilpatrick Townsend's renewal of 28,600 sq. ft. at 1400 Wewatta downtown and Bank of Colorado preleased 18,700 sq, ft. at McGregor Square, the first office lease signed at the project currently under construction. Figure 4: Speculative Preleased Construction 3.0MSF Speculative Under Construction 79.0% 21 .0ciiU • Preleased Sq. Ft ® Available Sg, Ft. Source: CBRE Research, 02 2020. Figure 5: Leasing Activity by Industry Type (03 2019-02 2020) • Technology • Healthcare & Insurance ri Other • Government & Non -profits ® Financial Services I Business & legal Services • Energy • Manufacturing Source: CBRE Research,02 2020 • Aerospace & Defense Creative Industries • Telecommunications Life Sciences Q2 2020 CBRE Research CO 2020 CBRE, Inc. 1 3 CBRE MARKETVIEW DENVER OFFICE VACANCY/AVAILABILITY Total vacancy reached 13.6%, a 55 bps change from Q2 2020. Class B buildings saw the largest increase of 104 bps to 14.7%. Direct vacancy increased 48 bps quarter -over -quarter to 12.1% in Q2 2020, this also represented a 15 bps uptick year -over -year. Downtown Denver saw a spike in direct vacancy, up 34 bps from Q1 2020 to 14.7%. Direct vacancy in the Southeast submarket climbed 101 bps to 12.3% in Q2 2020. Total availability also increased by over 1.0 million sq. ft. or 91 bps quarter -over -quarter to 17.8%. Availability in the Downtown submarket rose to 20,4%, up 185 bps quarter -over -quarter. The Southeast submarket dipped 26 bps from Q1 2020 to 18,5%. Overall sublease availability increased 33.3% to 3.4 million sq. ft. as many companies have had to conduct layoffs and are re-evaluating space requirements moving forward. Class B space saw the largest uptick, increasing over 697,000 sq. ft.. or 78.5% to 1.6 million sq. ft of sublease space. Class A followed, climbing 137,600 sq. ft. quarter -over - quarter to 1.7 million sq. ft. available. Downtown sublease availability rose to 1.7 million sq. ft. —a 34.7% increase in sublease space quarter -over - quarter. The Southeast market saw a 30.0% increase from last quarter to 973,000 sq. ft ABSORPTION Metro Denver posted negative 84,706 sq. ft. of absorption in Q2 2020, the first time in 13 quarters that negative absorption has been recorded. Class B and Class C buildings drove this activity, logging a cumulative negative 197,947 sq. ft. of net absorption. A few sizable occupancies in Class A space helped offset the negative activity, the asset class posted 11.3,241 sq. ft. of positive net absorption in Q2 2020. The Northwest submarket led net absorption activity, recording over 261,000 sq. ft. Crocs occupied 88,300 sq. ft. at ATRIA, Blue Canyon Technologies moved into 80,100 sq. ft. at 2550 Crescent and Ball Aerospace took 97,800 sq. ft. at Westmoor Technology Park. Negative net absorption activity was driven by numerous mid- sized[ tenants closing and the space going direct. Despite the negative absorption in Q2 2020, the year-to-date absorption volume remained elevated, with 330,649 sq. ft. of positive net absorption. Figure 6: Sublease Availability Sublease Available Sq. Ft (000's) 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 01 2019 02 2019 03 2019 04 2019 012020 02 2020 ■ Downtown Sublease Available ■ Other Sublease Available Source: CBRE Research, 02 2020. Figure 7: Net Absorption vs. Lease Rate Net Absorption (000's) 3,500 3,000 2,500 2,000 1,500 1,000 500 0 -500 ® Southeast Sublease Available Direct Asking Lease Rate ($) 30 29 28 27 26 25 24 23 22 2016 2017 2018 2019 2020 01 02 03 04 • YID Total Asking Lease Rate Source: CBRE Research, 02 2020 Q2 2020 CBRE Research --err O 2020 CBRE, Inc. I 4 CBRE MARKETVIEW EW DENVER OFFICE AVERAGE ASKING LEASE RATES The average direct asking lease rate for the metro Denver area remained stable quarter -over -quartet, decreasing $0.01 to $28.81 per sq. ft. FSG, Class A buildings saw the largest decrease of $0.38 to $31.46 per sq. ft. FSG. Adversely, asking rates in Class B buildings increased $0.51 to $27.98 per sq. ft. FSG and Class C rates saw a slight increase of $0.06 to $23.65 per sq. ft. FSG. The lease rate change is attributed to the uptick in availability in Class B and Class C buildings. Due to the increase in activity, the overall sublease asking lease rate climbed $1.52 from Qi 2020 and a staggering $3.55 on the year to $29.57 per sq. ft. FSG. This was driven by the sublease availability in the Downtown submarket which consistently demands premium rents. The Downtown submarket direct average asking rates fell $0.21 to $35.00 per sq. ft. PSG. The Downtown sublease asking rate increased $0.71 from Q1 2020 and $1.53 year -over -year to $34.44 18 per sq. ft. FSG. The Southeast submarket direct asking rate saw an increase of $0,10 to $26.87 per sq. ft. FSG. Sublease asking rates in the area also spiked to $23.99 per sq. ft. FSG— a $0.58 increase from Q1 2020 and $1.12 on the year. INVESTMENT TRENDS Office investment sales halted in QZ 2020 as investors struggle to underwrite properties due to the uncertainty brought on by COVID-19. One office sale took place in metro Denver this quarter bringing the year-to-date volume up to $871,9 million, a 44.9% decrease from the first half of 2019. Matador Equity Partners purchased 3200 Cherry Creek Dr in the Cherry Creek submarket for $44 million or $336.77 per sq. ft. 16 14 022019 032019 042019 012020 Q22020 Figure 8: Average Asking Lease Rate Average Direct Asking Lease Rate (5) 35 30 25 20 2O16 2017 2018 2019 02 202O Class A . , Class B ... a Direct Asking Lease Rate Source: CBRE Research, Q2 2020, Figure 9: Lease Rate vs. Availability Availability Rate (era) 20 earn Average Asking Lease Rate ($) ...35 w.. f.— .nn.-_.-_n._....n'..vf...,. r.P.P...aan.. 30 25 20 Direct Availability Rate binisid Sublease Availability Rate Direct Asking Leese Rate eSublease Asking Lease Rote Source: CBRE Research, 02 2020. Figure 10: Investment Sales Investment Sales ($10O Millions) 10.0 8.0 _ 6.0 _ 4.0 — 2.0 0.0 os. Price per Sq. R. ($) 400 300 2O0 100 02 2O19 O3 2O19 04 2O19 01 2020 02 2020 Suburban Downtown k 'Metro Average Price Per Seq. Ft. Source: CBRE Research, Q2 2020. O2 2020 CBRE Research = © 2020 CBRE, Inc. I 5 CBRE MARKETVIEW DENVER OFFICE River itorih CONTACTS Layne Voorhees Research Analyst +1 303 583 2016 layne..voorheesacbre.co m Sue Scale Associate Research Director +1 303 628 1760 sue.selleia cbre.corn To learn more about CBRE Research or to access additional research reports, please visit the Global Research Gateway at www. core. con/researchgatewaya. MARKET OUTLOOK Virology, not the business cycle, has dictated the course of the world's economy this year. COVID-1.Y forced a nationwide shutdown of most economic activity in March, with the largest economic centers, especially the Northeast and Pacific coast, facing the strictest lockdowns. The economic fallout proved severe, pushing unemployment to over 15% and likely causing the economy to contract by more than 30% per annum in the second quarter. These morbid economic conditions inspired many governors to ease lockdowns, especially in Sunbelt states where the case count was less severe than in more densely populated regions. These re - openings have energized activity. Several high - frequency indicators, such as hotel occupancies, restaurant traffic and hours worked, suggest the US economy bottomed in April and has been trending slightly upward since. This has renewed demand for labor as many hard-hit sectors, such as hospitality and healthcare, began to bring back furloughed workers in May. CBRE OFFICES Downtown Denver 1225 17th Street, Suite 3200 Denver, CO 80202 Denver Tech Center 5455 Landmark Place, Suite C102 Greenwood Village, CO 801.11. Boulder 1805 11th St, Unit A Boulder, CO 80302 Colorado Springs 121 South Tejon Street, Suite 1111 Colorado Springs, CO 80903 Fort Collins 3 003 East Harmony Road, Suite 300 Fort Collins, CO 80528 Disclaimer: Inforrnation contained herein, including projections, hos been obtained from sources believed to be reliable. While we do not doubt its accuracy, we have not verified it and make no guarantee, warranty or representation about it. It is your responsibility to confirm independently its accuracy and completeness. This information is presented exclusively for use by CBRE clients and professionals and all rights to the material are reserved and cannot be reproduced without prior written permission of CBRE. FOR, PROPERTY TAX REPRESENTATION Property Owner See Attached List Subject Property See Attached List Junsdiction n sdictio n and State 202112022 Year This letter authorizes Ryan, RC and its affiliate, Ryan Tax Compliance Services, LLC to represent the above -named property as its property tax agent in the jurisdiction and state named above. This authorization includes but is not limited to. filing properly renditions or retums, signing and filing appeals; examining property tax records; and, appearances before the assessor, boards of equalization or review, or other governmental agencies responsible for the assessment of property. If there are any questions concerning this authorization, please contact the following: Ethan Horn, (720)524 022, ethan.hom@ryan.com A copy of any application or appeal attached to this authorization has been provided to the undersigned property owner. A facsimile or scanned image of a signature below shall constitute an original signing of this authorization and the document containing the original signature will be submitted upon request. This authorization shall remain effective as long as permitted by law or until revoked in writing by the owner. The person signing below certifies that they are a duly appointed officer, representative or agent of the owner and that they have the legal capacity to execute this authorization. SiQP\r)c,(\ kobC, Printed Name Sworn and subscribed before me this Z. Se- day of Al S/18'I Zez\ , 2021. Date Notary Public My commission expires: VS t /z o Banner Health and all Subsidiaries Property list State Ownership Entity Address Parcel Jurisdictio F CO Global Village Acadcrnv-Nerthglenn Building Corp Grant Drive R0122457 Adams C CO Global Villa a Aeadcm -North lenn Building Corp Grant Drive R0122457 Adams g � g CO CO Global Village Academy-N©nhglenn Building Corp Grant Drive R0122458 Adams I Global Village Academy-Nor1hglenn Building Corp Grant Drive Rili22458 Aims BANNER HEALTH 1230 14th STS 1 1 13 Larim�crCO BANNER HEALTH H 1230 14th ST SW P,1652135 Larirner CO Lan r CO BANNER HEALTH 1620 HOFFMAN DR R0334O22 CO BAN NER HEALTH 1620 HOFFNIA141 OR 80334122 I BANNER HEALTH 1632 Hoffman Drive R0334049 Lari r CO BANNER HEALTH 1632 Hoffman Drift e R0334049 l afi mer CO Banner Health 1813 CHEYENNE A VE 14062 7151 Larirncr CO - CO Banner Health 1813 CHEYENNE AVE R0627151 Larimer Banner Health 401 I ffi -t 1 STREET R1218956 Larimer CO CO Banner Health 401 10TH STREET R1218956 2.18956 Larinx r BANNER HEALTH 47(X) LADY MOON DR 81655133 Lavin r CO CO BANINIER HEALTH 4700 LADY MOON DR 1 1+ 55133 I arimer CO BANNER HEALTH 111 E COUNTY Y ROAD 32 R 15137'9, Larilner CO BANNER HEALTH 111 E COUNTY ROAD 32 R 1 I X7 6 Lari mcr BALER HEALTH 203 'E COUNTY RD 32 R151375A 137 S CO BANNER HEALTH 203 E COUNTY RD 32 R1513788 Larimer CO BANNER HEALTH 2923 GINNALA DR R1104764 Larimer CO BANNER HEALTH 2923 G1NNALA DR R1104764 Larimer CO CO BANNER HEALTH 2924 GINNALA DR RIR1104896 Larimer BANNER HEALTH 2924 C1NNALA DR RI 1048% Larimer CO CO BANNER HEALTH 2995 GINNALA DR R1104756 Larirner BANNER HEALTH 2995 C1NNALA DR R1104756 Larimer CO R0660124 Larimer CO BANNER HEALTH I9O N BOISE AVE 3 R0660124 Larimer CO BANNER HEALTH 1907 N BOISE AVE3 Latimer CO Banner Health 303 Calland Dr RI6O4151 R1604151 Larimer CO Banner Health 303 Colland Dr 1703E 18TH ST R1623802 1.arimer CO BANNER HEALTH R 1623802 Larimer CO BANNER HEALTH 1703 E 18111 ST R0627143 Larimer CO Banner I Icalth 1825 E. 18th Street Banner Health 1825 E. 18th Street R0627143 Larimer CO 81.658759 Larimer CO Banner Health Centerra Office Partin Tract B, BIk I, McWhinney 17 Banner Health Centerra Office Partn Tract B, Mk 1, McWhinncy 17 81658759 Lai inner CO Banner Health dba McKee Medical Cen 2000 N. Boise Ave., R 1648522 Ladner CO Banner Health dba McKee Medical Cen 2000 N. Boise Ave. R16-18522 Larimer s CO BRFNT POWELL FINANCIAL LLC 1808 N BOISE AVE 81659443 Lamner CO R1659443 Larimer CO B1 N- N T POWELL FINANCIAL LLC 1808 N BOISE AVE City Loveland 428-450 N Cleveland Me 80445479 Larimer j CO of R0445479 Lan MC T Oh of Loy cl,aud 428-450 N CIO, and Ate R0445436 Larimer CO 444 N. C l la ntl Me I h ni Ci1\ of Unit:land R Uui rncr Crt� +f Loveland 444 N. Cie► land AN c that -- R 1+[> 2t12 City of Lo\ eleand 320 N Cies elm Larur r CCr 02 Oh of Lovelearxl 120 N CloeLindI Lari f CD Ci3 tix7 ] v n rr r Golden Stone es LLC 1618 E MTh Street Larinrr C 11 76 91- Golden Store Pmperties LLC 1 618 E Mil Street H AWE LARRY B 1808 N BOISE AVE 121 1-.ann r 1 1�6► 94-�a HAWE LARRY f: 1108 N BOISE AVE 120 Lri�er CO h;D�► Holdings LLC' 1.808 N Boise Ave 200 . r KDXHoldin�LLC 1 iSNBuieAre211 ' CO La�imear ION e 450 l 42 i N. CLE' . ELLAND ASE .l_.�C. lose 450 LlaC 428 N. CLEVELAND AVE CO R1629183 .2r of CO LOVELAND MEDICAL ENTERPRISES !_.LC ?555 E I37 ST R 1629183 La,nr r CO LOVELAND MEDICAL ENTETSRISES [IC R1629191Lari r CO LOVELAND MEDICAL ENTERPRISES LLC 2555 E 13T]1 STREET CO L n rncr LOVELAND MEDICAL ENTERPRISES LLC 2555 E 131.`H mien' PERCIVAL JOHN M REVOCABLE TRUST 1810 N BOISE R1659441 CO R1659442 9442 Lartrnter PERCIVAL JOHN M REVOCABLE TRUST 1810 N BOISE tone ail Cn k h L LL.p 1808 N Boise Ave R1659444 CO R1659414 Latimer CO tone all Creek Ranch LLLP 1808 N Boise Me I Logan CO 38052530303(k)3 B.�n ner H lth 1i121iA Y"S A�v'E Banner Health 102 l l i rr ASE 3805 530303003 Logan CO Bantle r f I cal th 1.1 }5 8th A,� a 3805 146291.1 Logan 3g05257,1462911 Login CO i Banner Health I 5 h A+ir erwc 38052531 462001 Logan CO Banner Health l 5 h Avenue 38052531462001 Logan CO Banner Health 1421 S. 8th Avenue 38052531462002 Logan CO FP P 1 S. Iith Avenue 38052531461002 Logan CO Banner Health Banner Health 507-515 Iris Dr. 38073505203010 Logan CO Banner Health 507-515 iris Dr 38073505203010 Logan CO Banner Health System 603 Holly Dr 38052531455025 Logan CO B anner Health System (3 -taltj; Dr 18052.511.45502i Logan CO i R0296001 Weld CO Banner Health Birncc r Health R0296001 Weld CO Banner Health 110295801 Weld Cf 80295# 011 d �` Banner Health Banner Health 1630 17th Ave Banner Health 1630 17th Me -R3123986 F 3123 i 'Meld O Banner Health 1630 17th A' c 'geld tO Banner Health 2020 1 tnth St R0038293 Weld CO Banner Health 2020 16th St 80038293 Weld CO Banner Health 21015 35th A\ ti: 38 eld CO Banner l lealth 2015 35th .A\ c CO Banner F lealth. [ 00 S Cherry Ave 1 R2791704 Weld I CO Banner Health 100 S Cherry Ave 1 R2791704 Weld i CO Banner Health 3401 11th St R8940089 Weld i CO Banner Health 3401 1 Ith St R8940089 Weld CO Banner Health 222 Johnston, n Center DR R027699ti Weld CO Banner Health x 222 30 N% n Center DR ' R0276995 Weld _ CO Banner Health R3124086 Weld CO 1625 17th Ave Banner Health 1625 17th .Ave R 1 1 24086 Weld Co Banner Health 1801 16th Street - T R3119386 Weld CO Weld Co Banner Health 1801 16th Street R3119386 Banner Health Weld CO 3 17340 R3173494- Banner Health R3173404 4 Weld Banner Health R8210700 Weld 2000 70th ANC Banner He l th .00(X) 70th Ave RS210700 WeldCO Banner Health - In 173204 Weld CO 1650 16th Street Banner Health I trig► 16th S P.,3173204 Weld CC) Banner Health R2647503 3 Weld Co Banner Health X623 I' th St -'4 estl e �C link R2647503 Weld CO Banner Health 1300 .plain St R 231 3 Weld CO Banner Health 13($) Main St 8[1213 93 - Weld CO NCMC BH Greeley Il [IC City Ctr West 69th Ave &. 10th 86780572 Weld CO NCMC BU Greeley it LLC I 86780572 Weld CO City- Ctr West 69th Ave & 10th Weld County- School District 6 1218 W. Ash a No A. R01772:49 Weld CO 'Weld County School District 6 11218 W. Ash St. No A. R0177289 Weld CO July 15, 2021 Petitioner: BANNER HEALTH 2901 N CENTRAL AVE STE 160 PHOENIX, AZ 85012-2702 CLERK TO THE BOARD PHONE (970) 400-4226 FAX (970) 336-7233 WEBSITE: www.weldqov.com 1150 O STREET P.O. BOX 758 GREELEY CO 80632 Agent (if applicable): RYAN LLC ETHAN HORN 1999 BROADWAY STE 400 DENVER, CO 80202-3025 RE: THE BOARD OF EQUALIZATION 2021, WELD COUNTY, COLORADO NOTIFICATION OF HEARING SCHEDULED Docket 2021-1993, AS0109 Appeal 2008230175 Hearing 8/4/2021 1:00 PM Account(s) Appealed: R2647503 Dear Petitioner(s): The Weld County Board of Equalization has set a date of August 4, 2021, at or about the hour of 1:00 PM, to hold a hearing on your valuation for assessment. This hearing will be held at the Weld County Administration Building, Assembly Room, 1150 O Street, Greeley, Colorado. You have a right to attend this hearing and present evidence in support of your petition. The Weld County Assessor or his designee will be present. The Board will make its decision on the basis of the record made at the aforementioned hearing, as well as your petition, so it would be in your interest to have a representative present. If you plan to be represented by an agent or an attorney at your hearing, prior to the hearing you shall provide, in writing to the Clerk to the Board's Office, an authorization for the agent or attorney to represent you. If you do not choose to attend this hearing, a decision will still be made by the Board by the close of business on August 5, 2021, and mailed to you within five (5) business days. Because of the volume of cases before the Board of Equalization, most cases shall be limited to 10 minutes. Also due to volume, cases cannot be rescheduled. It is imperative that you provide evidence to support your position. This may include evidence that similar homes in your area are valued less than yours or you are being assessed on improvements you do not have. Please note: The fact that your valuation has increased cannot be your sole basis of appeal. Without documented evidence as indicated above, the Board will have no choice but to deny your appeal. If you wish to discuss your value with the Assessor's Office, please call them at (970) 400-3650. If you wish to obtain the data supporting the Assessor's valuation of your property, please submit a written request directly to the Assessor's Office by emailing assessor@weldgov.com or sending a fax to (970) 304-6433. Upon receipt of your written request, the Assessor will notify you of the estimated cost of providing such information. Payment must be made prior to the Assessor providing such information, at which time the Assessor will make the data available within three (3) working days, subject to any confidentiality requirements. Please advise me if you decide not to keep your appointment as scheduled. If you need any additional information, please call me at your convenience. Very truly yours, BOARD OF EQUALIZATION Esther E. Gesick Clerk to the Board Weld County Board of Commissioners and Board of Equalization cc: Brenda Dones, Assessor July 15, 2021 Agent: RYAN LLC ETHAN HORN 1999 BROADWAY STE 400 DENVER, CO 80202-3025 CLERK TO THE BOARD PHONE (970) 400-4226 FAX (970) 336-7233 WEBSITE: www.weldqov.com 1150 O STREET P.O. BOX 758 GREELEY CO 80632 Petitioner: BANNER HEALTH 2901 N CENTRAL AVE STE 160 PHOENIX, AZ 85012-2702 RE: THE BOARD OF EQUALIZATION 2021, WELD COUNTY, COLORADO NOTIFICATION OF HEARING SCHEDULED Docket 2021-1993, AS0109 Appeal 2008230175 Hearing 8/4/2021 1:00 PM Account(s) Appealed: R2647503 Dear Petitioner(s): The Weld County Board of Equalization has set a date of August 4, 2021, at or about the hour of 1:00 PM, to hold a hearing on your valuation for assessment. This hearing will be held at the Weld County Administration Building, Assembly Room, 1150 O Street, Greeley, Colorado. You have a right to attend this hearing and present evidence in support of your petition. The Weld County Assessor or his designee will be present. The Board will make its decision on the basis of the record made at the aforementioned hearing, as well as your petition, so it would be in your interest to have a representative present. If you plan to be represented by an agent or an attorney at your hearing, prior to the hearing you shall provide, in writing to the Clerk to the Board's Office, an authorization for the agent or attorney to represent you. If you do not choose to attend this hearing, a decision will still be made by the Board by the close of business on August 5, 2021, and mailed to you within five (5) business days. Because of the volume of cases before the Board of Equalization, most cases shall be limited to 10 minutes. Also due to volume, cases cannot be rescheduled. It is imperative that you provide evidence to support your position. This may include evidence that similar homes in your area are valued less than yours or you are being assessed on improvements you do not have. Please note: The fact that your valuation has increased cannot be your sole basis of appeal. Without documented evidence as indicated above, the Board will have no choice but to deny your appeal. If you wish to discuss your value with the Assessor's Office, please call them at (970) 400-3650. If you wish to obtain the data supporting the Assessor's valuation of your property, please submit a written request to assessor@weldgov.com. Upon receipt of your written request, the Assessor will notify you of the estimated cost of providing such information. Payment must be made prior to the Assessor providing such information, at which time the Assessor will make the data available within three (3) working days, subject to any confidentiality requirements. Please advise me if you decide not to keep your appointment as scheduled. If you need any additional information, please call me at your convenience. Very truly yours, BOARD OF EQUALIZATION Esther E. Gesick Clerk to the Board Weld County Board of Commissioners and Board of Equalization cc: Brenda Dones, Assessor August 5, 2021 Petitioner: BANNER HEALTH 2901 N CENTRAL AVE STE 160 PHOENIX, AZ 85012-2702 CLERK TO THE BOARD PHONE (970) 400-4226 FAX (970) 336-7233 WEBSITE: www.weldgov.com 1150 O STREET P.O. BOX 758 GREELEY CO 80632 Agent (if applicable): RYAN LLC ETHAN HORN 1999 BROADWAY STE 400 DENVER, CO 80202-3025 RE: THE BOARD OF EQUALIZATION 2021, WELD COUNTY, COLORADO NOTICE OF DECISION Docket 2021-1993 Appeal 2008230175 Hearing 8/5/2021 Dear Petitioner: On the day indicated above, the Board of County Commissioners of Weld County Colorado convened and acting as the Board of Equalization, pursuant to C.R.S. §39-8-101 et seq., considered petition for appeal of the Weld County Assessor's valuation of your property described above, for the year 2021. Account # Decision The Assessment and valuation is set as follows: Actual Value as Actual Value as Set by Determined by Assessor Board R2647503 Stipulated - Approved Stipulated Value $1,696,640 $1,395,872 A denial of a petition, in whole or in part, by the Board of Equalization must be appealed within thirty (30) days of the date the denial is mailed to you. You must select only one of the following three (3) options for appeal: 1. Appeal to Board of Assessment Appeals: You have the right to appeal the County Board of Equalization's decision to the Colorado Board of Assessment Appeals. A hearing before that Board will be the last time you may present testimony or exhibits or other evidence, or call witnesses in support of your valuation. If the decision of the Board of Assessment Appeals is further appealed to the Court of Appeals pursuant to C.R.S. §39-8-108(2), only the record of proceedings from your hearing before the Board of Assessment Appeals and your legal brief are filed with the appellate court. All appeals to the Board of Assessment Appeals filed after August 10, 2021, MUST comply with the following provisions of C.R.S. §39-8-107(5): (5)(a)(I) On and after August 10, 2021, in addition to any other requirements under law, any petitioner appealing either a valuation of rent -producing commercial real property to the Board of Assessment Appeals pursuant to C.R.S. §39-8-108(1) or a denial of an abatement of taxes pursuant to C.R.S. §39-10-114 shall provide to the County Board of Equalization or to the Board of County Commissioners of the County in the case of an abatement, and not to the Board of Assessment Appeals, the following information, if applicable: (A) Actual annual rental income for two full years including the base year for the relevant property tax year; (B) Tenant reimbursements for two full years including the base year for the relevant property tax year; (C) Itemized expenses for two full years including the base year for the relevant property tax year; and (D) Rent roll data, including the name of any tenants, the address, unit, or suite number of the subject property, lease start and end dates, option terms, base rent, square footage leased, and vacant space for two full years including the base year for the relevant property tax year. (II) The petitioner shall provide the information required by subsection (5)(a)(I) of this paragraph (a) within ninety days after the appeal has been filed with the Board of Assessment Appeals. (b)(I) The Assessor, the County Board of Equalization, or the Board of County Commissioners of the County, as applicable, shall, upon request made by the petitioner, provide to a petitioner who has filed an appeal with the Board of Assessment Appeals not more than ninety days after receipt of the petitioner's request, the following information: (A) The primary method used by the county to determine the value of the subject property; and (B) The rates used by the county to determine the value of the subject property under the method identified in accordance with subsection (5)(b)(l)(A) of this section. (II) The party providing the information to the petitioner pursuant to subparagraph (I) of this paragraph (b) shall redact all confidential information contained therein. (c) If a petitioner fails to provide the information required by subparagraph (I) of paragraph (a) of this subsection (5) by the deadline specified in subparagraph (II) of said paragraph (a), the County may move the Board of Assessment Appeals to compel disclosure and to issue appropriate sanctions for noncompliance with such order. The motion may be made directly by the County Attorney and shall be accompanied by a certification that the County Assessor or the County Board of Equalization has in good faith conferred or attempted to confer with such petitioner in an effort to obtain the information without action by the Board of Assessment Appeals. If an order compelling disclosure is issued under this paragraph (c) and the petitioner fails to comply with such order, the Board of Assessment Appeals may make such orders in regard to the noncompliance as are just and reasonable under the circumstances, including an order dismissing the action or the entry of a judgment by default against the petitioner. Interest due the taxpayer shall cease to accrue as of the date the order compelling disclosure is issued, and the accrual of interest shall resume as of the date the contested information has been provided by the taxpayer. Appeals to the Board of Assessment Appeals must be made on forms furnished by that Board, and must be mailed or delivered within thirty (30) days of the date the denial by the Board of Equalization is mailed to you. The address and telephone number of the Board of Assessment Appeals are: Board of Assessment Appeals 1313 Sherman Street, Room 315 Denver, Colorado 80203 Telephone Number: (303) 864-7710 Email: baa@state.co.us Fees for Appeal to the Board of Assessment Appeals: A taxpayer representing himself is not charged for the first two (2) appeals to the Board of Assessment Appeals. A taxpayer represented by an attorney or agent must pay a fee of $101.25 per appeal. OR 2. Appeal to District Court: You have the right to appeal the decision of the Board of Equalization to the District Court of the county wherein your property is located: in this case that is Weld County District Court. A hearing before The District Court will be the last time you may present testimony or exhibits or other evidence, or call witnesses in support of your valuation. If the decision of the District Court is further appealed to the Court of Appeals pursuant to C.R.S. §39-8-108(1), the rules of Colorado appellate review and C.R.S. §24-4-106(9), govern the process. OR 3. Binding Arbitration: You have the right to submit your case to binding arbitration. If you choose this option, the arbitrator's decision is final and you have no further right to appeal your current valuation. C.R.S. §39-8-108.5 governs this process. The arbitration process involves the following: a. Select an Arbitrator: You must notify the Board of Equalization within 30 days that you will pursue arbitration. You and the Board of Equalization will select an arbitrator from the official list of qualified people. If you cannot agree on an arbitrator, the District Court of the county in which the property is located (i.e. Weld) will select the arbitrator. b. Arbitration Hearing Procedure: Arbitration hearings are held within sixty (60) days from the date the arbitrator is selected, and are set by the arbitrator. Both you and the Board of Equalization are entitled to participate in the hearing. The hearing is informal. The arbitrator has the authority to issue subpoenas for witnesses, books, records documents and other evidence pertaining to the value of the property. The arbitrator also has the authority to administer oaths, and determine all questions of law and fact presented to him. The arbitration hearing may be confidential and closed to the public' if you and the Board of Equalization agree. The arbitrator's decision must be delivered personally or by registered mail within ten (10) days of the arbitration hearing. c. Fees and Expenses: The arbitrator's fees and expenses are agreed upon by you and the Board of Equalization. In the case of residential real property, the fees may not exceed $150.00 per case. For cases other than residential real property, the arbitrator's total fees and expenses are agreed to by you and Board of Equalization, but are paid by the parties as ordered by the arbitrator. If you have questions concerning the above information, please call me at (970) 400-4226. Very truly yours, BOARD OF EQUALIZATION Esther E. Gesick Clerk to the Board Weld County Board of Commissioners and Board of Equalization cc: Brenda Dones, Weld County Assessor August 5, 2021 Agent: RYAN LLC ETHAN HORN 1999 BROADWAY STE 400 DENVER, CO 80202-3025 CLERK TO THE BOARD PHONE (970) 400-4226 FAX (970) 336-7233 WEBSITE: www.weldqov.com 1150 O STREET P.O. BOX 758 GREELEY CO 80632 Petitioner: BANNER HEALTH 2901 N CENTRAL AVE STE 160 PHOENIX, AZ 85012-2702 RE: THE BOARD OF EQUALIZATION 2021, WELD COUNTY, COLORADO NOTICE OF DECISION Docket 2021-1993 Appeal 2008230175 Hearing 8/5/2021 Dear Petitioner: On the day indicated above, the Board of County Commissioners of Weld County Colorado convened and acting as the Board of Equalization, pursuant to C.R.S. §39-8-101 et seq., considered petition for appeal of the Weld County Assessor's valuation of your property described above, for the year 2021. Account # Decision The Assessment and valuation is set as follows: Actual Value as Actual Value as Set by Determined by Assessor Board R2647503 Stipulated - Approved Stipulated Value $1,696,640 $1,395,872 A denial of a petition, in whole or in part, by the Board of Equalization must be appealed within thirty (30) days of the date the denial is mailed to you. You must select only one of the following three (3) options for appeal: 1. Appeal to Board of Assessment Appeals: You have the right to appeal the County Board of Equalization's decision to the Colorado Board of Assessment Appeals. A hearing before that Board will be the last time you may present testimony or exhibits or other evidence, or call witnesses in support of your valuation. If the decision of the Board of Assessment Appeals is further appealed to the Court of Appeals pursuant to C.R.S. §39-8-108(2), only the record of proceedings from your hearing before the Board of Assessment Appeals and your legal brief are filed with the appellate court. All appeals to the Board of Assessment Appeals filed after August 10, 2021, MUST comply with the following provisions of C.R.S. §39-8-107(5): (5)(a)(I) On and after August 10, 2021, in addition to any other requirements under law, any petitioner appealing either a valuation of rent -producing commercial real property to the Board of Assessment Appeals pursuant to C.R.S. §39-8-108(1) or a denial of an abatement of taxes pursuant to C.R.S. §39-10-114 shall provide to the county Board of Equalization or to the Board of County Commissioners of the County in the case of an abatement, and not to the Board of Assessment Appeals, the following information, if applicable: (A) Actual annual rental income for two full years including the base year for the relevant property tax year; (B) Tenant reimbursements for two full years including the base year for the relevant property tax year; (C) Itemized expenses for two full years including the base year for the relevant property tax year; and (D) Rent roll data, including the name of any tenants, the address, unit, or suite number of the subject property, lease start and end dates, option terms, base rent, square footage leased, and vacant space for two full years including the base year for the relevant property tax year. (II) The petitioner shall provide the information required by subsection (5)(a)(I) of this paragraph (a) within ninety days after the appeal has been filed with the board of assessment appeals. (b)(I) The Assessor, the County Board of Equalization, or the Board of County Commissioners of the County, as applicable, shall, upon request made by the petitioner, provide to a petitioner who has filed an appeal with the Board of Assessment Appeals not more than ninety days after receipt of the petitioner's request, the following information: (A) The primary method used by the county to determine the value of the subject property; and (B) The rates used by the county to determine the value of the subject property under the method identified in accordance with subsection (5)(b)(l)(A) of this section. (II) The party providing the information to the petitioner pursuant to subparagraph (I) of this paragraph (b) shall redact all confidential information contained therein. (c) If a petitioner fails to provide the information required by subparagraph (I) of paragraph (a) of this subsection (5) by the deadline specified in subparagraph (II) of said paragraph (a), the County may move the Board of Assessment Appeals to compel disclosure and to issue appropriate sanctions for noncompliance with such order. The motion may be made directly by the County Attorney and shall be accompanied by a certification that the County Assessor or the County Board of Equalization has in good faith conferred or attempted to confer with such petitioner in an effort to obtain the information without action by the Board of Assessment Appeals. If an order compelling disclosure is issued under this paragraph (c) and the petitioner fails to comply with such order, the Board of Assessment Appeals may make such orders in regard to the noncompliance as are just and reasonable under the circumstances, including an order dismissing the action or the entry of a judgment by default against the petitioner. Interest due the taxpayer shall cease to accrue as of the date the order compelling disclosure is issued, and the accrual of interest shall resume as of the date the contested information has been provided by the taxpayer. Appeals to the Board of Assessment Appeals must be made on forms furnished by that Board, and must be mailed or delivered within thirty (30) days of the date the denial by the Board of Equalization is mailed to you The address and telephone number of the Board of Assessment Appeals are: Board of Assessment Appeals 1313 Sherman Street, Room 315 Denver, Colorado 80203 Telephone Number: (303) 864-7710 Email: baa@state.co.us Fees for Appeal to the Board of Assessment Appeals: A taxpayer representing himself is not charged for the first two (2) appeals to the Board of Assessment Appeals. A taxpayer represented by an attorney or agent must pay a fee of $101.25 per appeal. OR 2. Appeal to District Court: You have the right to appeal the decision of the Board of Equalization to the District Court of the county wherein your property is located: in this case that is Weld County District Court. A hearing before The District Court will be the last time you may present testimony or exhibits or other evidence, or call witnesses in support of your valuation. If the decision of the District Court is further appealed to the Court of Appeals pursuant to C.R.S. §39-8-108(1), the rules of Colorado appellate review and C.R.S. §24-4-106(9), govern the process. OR 3. Binding Arbitration: You have the right to submit your case to binding arbitration. If you choose this option, the arbitrator's decision is final and you have no further right to appeal your current valuation. C.R.S. §39-8-108.5 governs this process. The arbitration process involves the following: a. Select an Arbitrator: You must notify the Board of Equalization within 30 days that you will pursue arbitration. You and the Board of Equalization will select an arbitrator from the official list of qualified people. If you cannot agree on an arbitrator, the District Court of the county in which the property is located (i.e. Weld) will select the arbitrator. b. Arbitration Hearing Procedure: Arbitration hearings are held within sixty (60) days from the date the arbitrator is selected, and are set by the arbitrator. Both you and the Board of Equalization are entitled to participate in the hearing. The hearing is informal. The arbitrator has the authority to issue subpoenas for witnesses, books, records documents and other evidence pertaining to the value of the property. The arbitrator also has the authority to administer oaths, and determine all questions of law and fact presented to him. The arbitration hearing may be confidential and closed to the public if you and the Board of Equalization agree. The arbitrator's decision must be delivered personally or by registered mail within ten (10) days of the arbitration hearing. c. Fees and Expenses: The arbitrator's fees and expenses are agreed upon by you and the Board of Equalization. In the case of residential real property, the fess may not exceed $150.00 per case. For cases other than residential real property, the arbitrator's total fees and expenses are agreed to by you and Board of Equalization, but are paid by the parties as ordered by the arbitrator. If you have questions concerning the above information, please call me at (970) 400-4226. Very truly yours, BOARD OF EQUALIZATION Esther E. Gesick Clerk to the Board Weld County Board of Commissioners and Board of Equalization cc: Brenda Dones, Weld County Assessor Hello