Atlanta-based developer Seefried Industrial Properties is expected to pay more than $280,000 per net usable acre this week for 130.6 acres under contract south of Orlando International Airport, where plans are established for a new Amazon fulfillment center that would be Orlando’s tallest and largest warehouse.
The total purchase price should near $26 million overall, based on the parcel’s maximum allowable impervious area of 91.42 acres, industrial market sources with insight on the deal told GrowthSpotter on Monday.
That total is in line with a title insurance value declared earlier this year by Tavistock Development Company‘s land owner affiliate, first reported here on April 3, with Amazon projected as tenant on April 24.
Sale of the property may close as soon as Wednesday. Seefried has named Amazon as its future tenant in emails to Orange County staff, with an expected 15-year lease on the facility, the Orlando Sentinel reported in early May.
At $280,000 or more per net developable acre, the price is high for new industrial development in Orlando, but within reason for a developer that has a NNN tenant committed for a build-to-suit project, said Jared Bonshire, director with Cushman & Wakefield’s industrial brokerage team in Orlando, who claimed no knowledge of the pending deal.
As a comparison, Duke Realty Corporation paid more than $284,900 per acre in late April for a site on Municipal Drive, two blocks off International Drive, to build a warehouse for local client PODS to relocate and expand its Orlando storage operations.
Officials with Seefried, Tavistock and Amazon did not respond to requests for comment on Monday.
To be located at 12340 Boggy Creek Road just south of the airport, the Amazon building’s footprint of 857,470 square feet would house 2.33 million square feet of storage area across a ground floor and two mezzanine levels.
A height of 51 feet was originally forecast by Seefried on plans in April, but the developer’s maximum height request is now 55 feet, according to May 17 comments by Tavistock’s civil engineers with Kimley-Horn back to Orange County planning staff.
That would be taller than any other warehouse in Greater Orlando. There is currently one other building in the market taller than 36 feet; 40 feet is a typical cutoff point because going above it prompts fire code changes, and higher development cost.
“When you sell a property like this, for comp purposes you want to focus on net usable acres, so pricing in the upper $200,000s to $300,000 doesn’t suprise me because there are limited sites for a user like this,” said David Murphy, senior vice president focused on industrial for CBRE in Orlando. “So few sites in Central Florida can accommodate that building footprint and proposed height, if I’m a developer I’m paying whatever I need to pay.”
Despite the 130.6-acre parcel’s maximum allowable impervious area of 91.42 acres, only 58.48 acres (45 percent) will be developed by Seefried for the building and its parking, per the Development Plan.
The other 72-plus acres will be dedicated to seven new stormwater ponds and compensating storage area, maintaining much of what has been undeveloped wetlands until now.
Tavistock’s land owner affiliate and Seefried filed site and building construction permit applications for the property in May and early June, following a DP approval by the county in late May.
Georgia-based general contractor The Conlan Company was named by Seefried on applications as its project construction lead. Conlan noted on plans that Phase 1 site work could start as soon as Oct. 15.
That phased site work was valued at more than $30 million collectively across multiple building permit applications. Tavistock filed another permit application in late May calling for 523,000 cubic yards of fill dirt to be brought in to build up this project’s parcel and a neighboring parcel still owned by Tavistock, together totaling 173 acres.
With more than 2,500 planned parking spaces, the facility would be a major job creator. Orange County’s economic development staff have declined to comment on if tax incentives have been requested by Seefried and/or Amazon from the county.
Key to the deal has been Tavistock taking the investment lead on widening a 1.5-mile stretch of Boggy Creek Road from two to four lanes. Part of the projected $14 million road investment will be reimbursed to Tavistock from Orange County via impact fee credits.
“This developer is getting an excellent site, and whatever they pay for it, it will be worth more,” said CBRE’s Murphy. “The challenge is where we go for the next big user that wants a similar site for a 1 million-square-foot building. We’ll have to go further into Polk or Lake counties, because these sites are gone in Orange.”
Amazon began increasing its direct footprint in Orlando last year, when in May 2016 the company confirmed its lease of 100,000 square feet of warehouse space near the tourism corridor, which has refrigerated storage and serves its “Prime Now” one- and two-hour delivery service.
Amazon already has two distribution centers in Central Florida of more than 1 million square feet, in Lakeland and Ruskin. In January, the company announced it would build a 1 million-square-foot fulfillment center in Jacksonville, its second in that market.
Have a tip about Central Florida development? Contact me at email@example.com, (407) 420-5685 or @bobmoser333. Follow GrowthSpotter on Facebook, Twitter and LinkedIn.