Orlando real estate investor El Hassan Erroudani's recent acquisition of a pair of 35-year-old warehouse and flex office buildings in East Orlando offers more evidence of the region's appetite for industrial space.
Erroudani's Hassmal LLC paid $2.68 million for the Crossroads Office Complex. That's $61 per square foot and more than twice the $1.2 million seller Sundial Holdings paid for the same properties in 2014.
Hassmal sourced a $1.7 million loan from Seacoast National Bank.
Sundial partner Yosef Edri told GrowthSpotter the property was mostly vacant when they bought it.
"It was in bad shape and it had been neglected," he said on Monday. "We put a lot of money into it. We put in a glass front and a new parking lot, and we brought in good tenants who still have several years on their lease. It's more stable now."
Erroudani owns about a half-dozen rental properties in Clermont and was part-owner of an IHOP on Orange Blossom Trail.
David Wilson, a member of the industrial team for Colliers International Central Florida, told GrowthSpotter the Crossroads complex was a classic example of smart value-add buy when Sundial purchased it three years ago. It's a stable property with local tenants.
"In this market, when you find something that's kicking off income there's going to be a lot of interested buyers," Wilson said. "We're seeing a hot market now - like we saw a few years back."
The demand for industrial space in Orlando and nationally continues to grow at record pace. As of January 2017, the industrial sector had registered 27 consecutive quarters of net occupancy gains, according to Cushman & Wakefield.