Red Clay Development Partners is planning for two apartment communities along busy U.S. 27 in unincorporated Polk County in the Four Corners submarket near Davenport and Haines City. The Georgia-based apartment developer wants to add 519 units on two properties about 10 miles apart.
The first 300 apartments would be on about 20 acres abutting the AdventHealth Heart of Florida Hospital. Red Clay plans to build its signature product – 3-story walk-up garden apartments of one, two and three bedrooms from 787 square feet to 1,340 square feet – Principal Jack Misiura told GrowthSpotter. The company is under contract to buy the three parcels stretching from Holly Hill Tank Road to Park Place Boulevard, he said. The working name for the community is Haines City Apartments, according to a site plan by architect Kimley-Horn.
Ten miles north, across I-4 and still with a Davenport zip code, Red Clay and Georgia-based Atlantic Residential are working together to plan and build 219 apartments at 27 and Legacy Park Boulevard. The 17-acre site also is under contract, Misiura said. Red Clay and Atlantic Residential worked together to build Indigo at Champions Ridge – Red Clay’s first project in Florida – located at U.S. 27 and Ronald Reagan Parkway (County Road 54) within the Four Corners Town Center Development of Regional Impact. Indigo, which opened earlier this year, is a 300-unit luxury housing community that sold in July for $100 million to Virginia-based Middleburg Communities.
“Everything has great access to Disney or I-4,” Misiura said of Polk County. “I think it’s what residents are looking for.”
Polk County planners are “great to deal with” from a planning and development standpoint, and the county is great from an economic standpoint as well, Misiura said. “We can build at a little bit of a discount — particularly with impact fees and particularly relative to Orange County and Osceola County. And taxes are lower,” he said. Because of all that, “we can usually offer more affordable rents in those locations.”
Misiura said the Holly Hill Tank Road community will be “the same product that we built at Indigo at Champions Ridge.” At Legacy Park, Red Clay may choose its 4-story elevator product because of the property’s open-space requirements (40%) with Green Swamp land. The Green Swamp Wildlife Management Area consists of 50,692 acres in Lake, Polk and Sumter counties and is part of the approximately 110,000 acres purchased to protect the land and water resources of the Green Swamp Basin.
“On both of these sites, since we’re west of 27, we’re dealing with Green Swamp,” Misiura said. “The densities are a little bit more restrictive because you have to have a little bit more open space.” With Legacy Park being a smaller site than Holly Hill Tank, “it lends itself to going up another story. If we can find a way to fit the 3-story on and save $25,000/unit in cost, that may be the way to go. It’s all a matter of trying to figure out how to keep costs at a reasonable level to raise capital.”
Red Clay is seeking investors for both Polk projects.
“From the capital side, it’s tight,” Misiura said. “We’re waiting to see what happens in both the bank front and the equity front. It’s harder to find equity for construction because banks are either shut down or being extremely cautious.”
In addition, insurance prices “have spiked and have really become difficult, particularly in the Florida market,” he said. “We’re being told to underwrite at $1,100 a unit. It was $400-$450 on the coast a few years ago. It really makes a difference economically.”
Misiura expects to close on the Holly Hill Tank land purchase in the fourth quarter 2023 with buildout of the first units in 12-14 months and completion in 18-24 months. He didn’t give details on the Legacy Park community, which according to property records is owned by GPK Real Estate Investment and Development. Property records also show Red Clay is asking for Conditional Use to allow the 219 units vs an allowed 199 on the useable 10 acres. Lakeland-based Kimley Horn is the civil engineer on both projects.
Red Clay may keep the two communities and rent/manage them or may put them for sale, like it did with Indigo, Misiura said.
“It depends on what our capital structure ends up being,” he said. “Our last project, we planned all along to build and sell.”
The Four Corners submarket continues to be a hot market for residential and commercial growth as Orlando’s population increases at fast rate and more visitors flock to theme parks and warm weather.
“We still feel like the market is undersupplied in general in most areas of the U.S. There seems to continue to be demand in the Orlando area,” Misiura said. “We’ve seen a little fluctuation in rents, but generally they are holding strong.”
Middleburg, which bought Indigo Citrus Ridge, doubled down on the Four Corners market with Mosby Citrus Ridge, a new 300-unit Class A apartment community just south of U.S. 192 the company is co-developing with equity partner Parse Capital. Just across the street, Park Square is building Aston Park, a 338-unit community with a mixture of 4-story apartment buildings and 2-story carriage house units.
Charleston, South Carolina-based Greystar Development closed Dec. 14 on the purchase of 19 acres of Four Corners Town Center, next to Indigo Citrus Ridge, for a proposed 330-unit apartment complex. The company paid $9.3 million to sellers Albertson Intl. Inc and CentreCorp Inc, according to the property deed.
ChampionsGate developer RIDA Development is proposing an added 2,136 multi-family units and 150,000 square feet of commercial space in Polk County on 80 acres located east of Westside Boulevard, north of Ronald Reagan Parkway, west of Champions Gate Boulevard and south of the Polk/Osceola County Line. RIDA is seeking changes to Polk’s land-use code for the project.