Unique financing model for Peak Innovation Park aims to spur job growth and economic development for region
D.A. Davidson & Co. has sold approximately $45 million of limited tax general obligation senior and subordinate bonds for the continued development of Peak Innovation Park located in Colorado Springs, Colo. The financings will fund critical infrastructure for the project, and bring significant technological and aeronautic innovation, employment and economic growth to the City of Colorado Springs.
At full build-out, the Peak Innovation Park will encompass more than 900 acres with more than 12 million square-feet of customized commercial space including a new state-of-the-art research and development (R&D) facility for Aerospace Corporation (COS-2), Amazon fulfillment and distribution centers, offices with a focus on aerospace, defense, cybersecurity and technology tenants, hotels and industrial uses.
“This is a significant project for Colorado Springs’ business communities and surrounding regions, with Peak Innovation Park representing the largest speculative office complex built in this city since 2001,” said Brooke Hutchens, managing director at D.A. Davidson. “Thanks to our financing model and ability to create strong partnerships involving the City, Peak Metropolitan District and Urban Frontier, D.A. Davidson has turned this vision into a reality. We are honored to be involved in this project and look forward to the positive impact that Peak Innovation Park will bring to its communities.”
Urban Frontier is the developer of the project. The developer entered into a Master Developer Agreement with the City of Colorado Springs by and through its enterprise, the Colorado Springs Airport providing a unique model for partnership between the airport and the Metropolitan District to fund public infrastructure on site. The Metropolitan District contains 485 acres within Peak Innovation Park, a commercial development located directly south of Colorado Springs Airport.
Peak Innovation Park is situated within a federal opportunity zone, a state enterprise zone and a local commercial aeronautical zone that include certain tax breaks and incentives tied to employment levels. Within these zones, investors can defer capital gains taxes on the sale of stocks, business assets or property by investing in certain qualified investment funds called “Opportunity Funds.”
“Colorado Springs is a reputable hub for industries across aerospace, defense, information technology, cybersecurity, healthcare, and more, with hundreds of manufacturers in the region. The continued development of Peak Innovation Park will likely attract additional Fortune 500 companies, national business operations and a highly educated workforce,” said Garrett Baum, managing partner at Urban Frontier. “Given its close proximity to the Colorado Springs Airport, business centers and access to nearby interstates and city centers, the Peak Innovation Park is primed for strong economic activity and continued connection among industries nationwide. We appreciate the financial models in place and our partnership with D.A. Davidson, both of which have made this project possible.”
Representing the first of a two-phased development timeline on the larger 900-acre site the property, upon completion, the development property plans to include the following projects, several of which are already under construction:
- Aerospace Corporation will deliver a second state-of-the-art, close to 90,000 square-foot research and development facility.
- An approximately 278,000 square-feet facility.
- Two office properties leased to a Denver-based commercial developer, the first phase consisting of nearly 215,000 square-feet, intended for aviation and space-related uses by design, and the second phase consisting of approximately 240,000 square-feet, intended for traditional office uses.
- Several small pad retail sites intended for a mix of restaurant and retail uses.
- Approximately 550,000 square-feet of speculative industrial space for warehouse, storage and related usage.
- Two hotel properties to accommodate residents, visitors and the local workforce.
These early-stage bond transactions were managed by the Special District Group at D.A. Davidson, comprised of 15 individuals exclusively dedicated to financing public infrastructure across the country. The group has extensive transaction experience, with more than 100 transactions and more than $2 billion of par amount issued in the past year.
D.A. Davidson & Co.’s Fixed Income Capital Markets group is a national leader in raising capital through fixed income banking, distribution and depository strategy. With 33 locations in 19 states, the group is consistently ranked among the top firms in the country. The fixed income team serves new issue clients in public finance and taxable debt issuance, and maintains a diverse sales and trading group interacting with taxable and tax-exempt investors including banks, credit unions, insurance companies, bond funds, money managers and trust companies.
About D.A. Davidson Companies
D.A. Davidson Companies is an employee-owned financial services firm offering a range of financial services and advice to individuals, corporations, institutions and municipalities nationwide. Founded in 1935 and headquartered in Montana, with corporate offices in Denver, Los Angeles, Portland and Seattle, the company has approximately 1,400 employees and offices in 27 states.
Subsidiaries include: D.A. Davidson & Co., the largest full-service investment firm headquartered in the Northwest, providing wealth management, investment banking, equity and fixed income capital markets services, and advice; Davidson Investment Advisors, a professional asset management firm; D.A. Davidson Trust Company, a trust and wealth management company; and Davidson Fixed Income Management, a registered investment adviser providing fixed income portfolio and advisory services.
For more information, visit dadavidson.com.