Looking to serve future suburban office development north of Orlando, Nashville-based Carter-Haston Real Estate Services recently paid $21.2 million for the newly built 138-unit Lofts at Savannah Park apartment community in Sanford.
Partner Jamie Shanks told GrowthSpotter the Sanford purchase made sense to the company because of the natural progression of growth northward, as areas closer to Orlando are built out.
Located at 5724 Byron Anthony Place, the apartments are in an area where the median price of a single-family home is in the high $200,000s, Shanks said. Savannah Park will appeal to workers who want to live in the area but are priced out of the single-family market.
The sale was closed on Sept. 26 and recorded Oct. 4 in Seminole County. The firm secured a $14 million mortgage on the property with 40/86 Mortgage Capital Inc., the commercial mortgage lending and servicing arm of 40/86 Advisors Inc., itself a subsidiary of CNO Financial Group.
Carter-Haston is a private fund management and property management company that owns a number of properties in Florida, including The Q at Maitland, another upscale apartment complex.
"We've been operating in the Orlando area for probably 20 years in the apartment markets," Shanks said on Monday. "We've got a pretty good familiarity with the market there: the growth, the jobs in the overall MSA."
He cited the progression of regional office growth that started in the south at the AAA National Headquarters in Heathrow, an area developed mostly in the 1980s. Development moved steadily north in more recent decades, culminating in Colonial TownPark at International Parkway and Heathrow Boulevard. Development in that area typically dates to the early 2000s.
"The next logical place for development is headed north along International (Parkway)," Shanks said. "Right now, there is not a ton of development right around our project."
The best example of nearby potential is the so-called "Rockefeller parcel,'' 28 acres directly across International Parkway from Savannah Park. The property's zoning has fueled talk of a hospital tower going up there, he said.
"It's vacant land right now but it's logical for high-density development to occur," he said.
The seller was Inland Private Capital Corp., a member of The Inland Real Estate Group of Companies Inc. of Oak Brook, Illinois. Inland Private Capital has been an active purchaser and manager of commercial and residential assets in the Orlando market for many years, according to Keith Lampi, IPCC's president and chief operating officer.
"The area's strong demographic and growth trends continue to drive our interest in acquisition opportunities in the Orlando MSA," Lampi said via email.
Altamonte Springs-based Roger B. Kennedy Inc. built the new apartments in 2015 at a cost of $11.7 million. At that time, it was called the Exchange at Savannah Park.
"The Exchange at Savannah Park Apartments were part of a joint venture, ground-up development project we entered into, which drove our firm's decision to sell this year upon construction completion and occupancy stabilization," Lampi said.
The apartments were 60 percent occupied when Carter-Haston put the purchase under contract, Shanks said. Three months later, lease-up was close to 85 percent.
"It was a pretty quick lease-up, but that's indicative of the demand in that area and the quality of the property," he said.
Carter-Haston is not likely to make any similar purchases in the area in the near future, Shanks said.
That's not the case for Inland Real Estate Group, which is again teaming up with Roger B. Kennedy on another Class A complex in the area: The Residences at Seminole Commons.
The 175-unit complex will cover six acres on Rinehart Road, just across Interstate 4 from Savannah Park. Construction began in late August, and should be completed in the next 14-15 months, said Cadesman Pope, director of business development for Roger B. Kennedy.
Inland's interest in the area will likely continue, said Lampi, IPCC's president and COO.
"As a company, IPCC has purchased more than $1 billion in assets per year over the last three years in our active pursuit for new opportunities," he said. "Orlando remains a market that checks a lot of boxes for us."