A Miami Beach-based investment group focused on small-bay industrial and flex properties paid $9.26 million on Oct. 22 for a three-asset portfolio in Orlando, its first in this market, and may pursue similar value-add deals locally, the company's principal told GrowthSpotter.
Z Asset Management Corp., which oversees more than 1 million square feet of multi-tenant and flex assets in South Florida and Tampa and is run by Greg Zeifman, won the three properties via Auction.com on Sept. 19, with full acquisition last Thursday.
"Buying a portfolio like this allows us to set up a team in the (Orlando) market now," said Zeifman, who works with a small group of private equity partners on Z Asset. "Now we can look at smaller property deals in the Orlando area that we couldn't before."
The land was formerly owned by a bank that foreclosed on it in 2012. LNR Property of Miami Beach, an affiliate of Starwood Property Trust, managed the loan as special servicer.
LNR invested roughly $1 million in new roofing on one of the properties through 2013 and over the past year spent another $150,000 on improvements at two of the centers to boost tenancy and position the assets for sale, according to Anthony Fisher, vice president with Hold Thyssen, which serves as manager and leasing agent on the Orlando properties.
"Zeifman has a clear plan for each of these buildings on how to deal with the vacancies, and get them reconfigured to be more attractive for the market," Fisher said. "His goal is to get these fully leased within 18 months."
The three Orlando properties, which total 308,000 square feet, include:
- Kirkman Commerce Center: located at 701 S. Kirkman Road, the property has 123,735 square feet overall and was 59 percent occupied at the time of purchase, up 10 percent from a year ago. One of its largest tenants is Transglobal Communications of Delaware, an AT&T subcontractor. It was bought for $2.94 million;
- Edgewater Commerce Center: Located at 6250 Edgewater Dr., the property has 64,000 square feet and was 74 percent occupied at sale, up 14 percent year-on-year. It's largest tenant is Flawless Physiques, a physical fitness center. It was bought for $2.12 million;
- Kennedy Commerce Center: Located at 997 W. Kennedy Blvd. in Eatonville, it has 120,192 square feet and was 63 percent occupied at sale, up 6 percent from 2014. Its main tenants are Closets by Design and printing company the Pamation Group. It was bought for $4.2 million.