Overview
Newmark, acting as exclusive advisor for the Seller, is pleased to present the opportunity to acquire a fee simple interest in 501 N. Division, a 114,534 SF Integrated Operations Center facility (the "Property") that is 100% leased to industry leader, Occidental Petroleum's ("Oxy") (S&P BB+) subsidiary, Anadarko Petroleum Corporation. Situated 38 miles north of Denver in the state’s largest county, Weld, and in the center of Colorado’s top oil and gas producing Denver- Julesburg (DJ) Basin, the Property is a critical component to Occidental’s success as one of the largest producers in the region.
Anadarko was acquired by the eighteenth largest oil and gas company in the world, Occidental Petroleum, in August 2019 for $55B. This acquisition contributed 30-years of experience in the area across 600,000 net acres, 2,200 vertical wells and 2,300 horizontal wells for production in addition to the company’s Integrated Operations Center (IOC) which is staffed 24-hours per day, 365-days per year enabling real-time monitoring of their operations in the area. This mission critical property holds 8+ years of remaining term pursuant to an initial 20-year lease that offers a triple net structure and 2.5%-3.0% annual escalations based upon CPI. The tenant also has two, five-year renewal options following the initial lease term and given its intentions to deploy hundreds of millions, if not billions, of capital spending into the area, this center will remain a critical feature to the tenant's ongoing efforts.
Colorado ranks fourth in the nation for crude oil production and produced more than 259 million barrels over the past 18 months. More than 80% of oil in Colorado comes from the DJ Basin where Occidental's operations in Colorado are located. An Occidental Petroleum subsidiary plans to drill 110 oil and gas wells in the next two years in a pair of projects approved by Colorado oil regulators last year. The drilling projects are both in Weld County, one just outside the town of Firestone and one on a remote cattle ranch near Roggen that will include the first wildlife conservation easement established to offset an oil project's impacts. The projects represent hundreds of millions of dollars of investment by the Houston-based oil company, a significant portion of the $900 million in annual spending Occidental budgets for oil and gas development in Colorado and Wyoming.
Occidental has been in the news recently as Warren Buffett's Berkshire Hathaway (NYS: BRK.A, BRK.B) purchased 763,017 shares of Occidental Petroleum (OXY) in February for $35.7 million. Berkshire Hathaway has grown its stake in the Houston-based energy company in recent years, with the latest purchase bringing its stake in the company up to 28.2%.
Investment Highlights
INVESTMENT GRADE TENANCY IN LEADING OIL & GAS CORPORATION
Occidental is among the world’s largest exploration and production companies, conducting operations that include developing, acquiring, and exploring for oil and natural gas resources. The company holds an S&P BB+ rating and produced over $2.4B in net income in 2024. Having held a presence in Colorado for over 30 years, Occidental is one of Colorado’s top oil and gas producers in producing 23.33M barrels of oil in 2023.
MISSION CRITICAL ASSET TO OCCIDENTAL AND THE D-J BASIN
501 N. Division Boulevard was built in 2013 as a build-to-suit for Occidental (fka Anadarko) and a mission critical operations center facility to both the company and the greater DJ Basin. The company’s Integrated Operations Center acts as the central hub for monitoring and managing its operations throughout the basin and communicates with each of its wells through an irreplaceable 192’ tall communications tower.
8+ YEAR NNN LEASE TERM
Having originally signed a 20-year NNN lease in 2013, Tenant has roughly 8.4 years of remaining lease term at the Property, with an expiration date of September 30, 2033. The lease structure is a true triple net lease with the only Landlord obligations being the repair, maintenance and replacement of the roof and structure for the building. In 2014, Occidental (fka Anadarko) and Landlord amended the initial lease to include an expansion of 68,034 SF to the existing building and removed the termination option, providing 18+ years of firm term. The Lease includes CPI rent escalations ranging from 2.5%-3.0% throughout the existing term.
DIRECT ACCESS TO THE DJ BASIN, ONE OF THE NATION’S TOP OIL BASINS
The DJ Basin, located in Colorado and Wyoming, is one of the top oil basins in the country. Occidental has further demonstrated its confidence in the DJ Basin as it they plan to drill 110 oil and gas wells in the next two years in a pair of projects approved by Colorado oil regulators last year. The drilling projects are both in Weld County, one just outside the town of Firestone and one
on a remote cattle ranch near Roggen that will include the first wildlife conservation easement established to offset an oil project's impacts. The projects represent hundreds of millions of dollars
of investment by the Houston-based oil company, a significant portion of the $900 million in annual spending Occidental budgets for oil and gas development in Colorado and Wyoming.
WELD COUNTY IS THE STATE’S OIL & GAS HUB
Weld County is responsible for roughly 82% of the state’s crude oil production as well as 56% of the natural gas production throughout the state of Colorado and has long been considered the
main contributor to Colorado’s oil and gas economy. It is home to leading oil and gas companies including Occidental, Chevron, Civitas, PDC Energy and many others. Nearly half of all oil wells
in the state are located within Weld County and ranks eighth among all U.S. counties for barrels of oil equivalent (BOE) production.
