UPDATED: SEPTEMBER 11, 2018 11:45 AM — A veteran Orlando real estate investor paid $16 million this week for a trio of office buildings across from the Maitland Concourse North mixed-use project.
Parkway CEO Jim Heistand told GrowthSpotter the new construction and amenities coming in across the street will add value to the Maitland Concourse South office portfolio the firm acquired Wednesday.
"This asset for us is pretty unique," Heistand said on Friday. "We really like that side of I-4, and there's a big project going in right across the street. We're going to make immediate improvements to make the workspaces a little more unique and creative."
Each of the low-rise office buildings was built between 1999 and 2002 and has just over 45,000 square feet of leasable space. Heistand said the occupancy rate was over 90 percent for all three at the time of the sale.
"We're going to spend about $1 million right away on improvements to the exterior, lobbies and common spaces," he said. "We're going to update all the tenant spaces, too. But we can't touch them until they renew."
Jeff Morris and Bret Felberg with JLL represented the seller, an affiliate of True North Management Group, which had purchased the complex in 2012. The property was originally owned and developed by an affiliate of Battaglia Group, who constructed the office park starting in 1999.
Parkway will assume the $10.6 million balance of True North's original $11.25 million loan, made by Goldman Sachs Mortgage Company and later passed through to Deutsche Bank.
Maitland Concourse North is in active construction, approved for multifamily, retail, office and hotel development. The Related Group out of Miami is master developer and is currently building a 350-unit multifamily segment, dubbed Trelago.
Battaglia Group, which retained ownership of the 52 acres of the mixed-use project, is currently negotiating with a buyer to develop the project's 130,000 square feet of retail and dining along Maitland Boulevard.
Parkway, in its current form, is the successor to Parkway Properties and Atlanta-based Cousins Properties, which merged in 2016 and last year divested of its three largest Orlando office assets: the 28-story Bank of America Center (421,069 square feet), the 19-story One Orlando Centre better known as the Wells Fargo Building (355,783 square feet), and the 18-story Citrus Center (260,751 square feet).
Heistand and partner Shipley Hall took the company private, initially with a portfolio of approximately 9 million square feet of office space in the Houston market. Since then, they have been on a buying spree, having just closed on a six-building portfolio in Raleigh, N.C.
"Maitland Concourse is actually the smallest deal we've done," he said.
Editor's Note: This story has been updated to correct the name of the original developer.