Chicago-based investors pay $10.5M for Walgreens site at Winter Park gateway

Aerial view of the recently acquired Walgreen's property at the northeast corner of W. Fairbanks and Orlando avenues in Winter Park.
Aerial view of the recently acquired Walgreen's property at the northeast corner of W. Fairbanks and Orlando avenues in Winter Park. (The Chetek Group of Marcus & Millichap)

A pair of low-profile commercial real estate investors from Chicago paid $10.55 million on Monday, all cash, for a triple net-leased Walgreens property at one of Winter Park's busiest intersections.

Located at 550 S. Orlando Ave. on the northeast corner with W. Fairbanks Avenue, the 1.34-acre property lies just outside the city's Martin Luther King Jr. Park, and has been net-leased by Walgreens since 2008 with 16 years remaining on the initial 25-year term.


The buyer was Jahu LLC, which is managed out of Palm Beach Gardens by principals Joseph Simon and Cary Rosen, who are investment partners behind Chicago-based SRE Holdings LLC.

Learn more about the South Florida land sale in April that funded the deal, and the Minnesota-based developer that flipped this property in less than a year.

Simon and Rosen have other LLC affiliates which own net-leased retail properties in Greater Orlando, including the McDonald's parcel at 1302 W. Fairbanks Ave. That lies just a block west of the Walgreen's, and is next to a 1.52-acre parcel that Leon Capital Group is trying to rezone for retail redevelopment.

"The draw was location. This is a net-leased investment property with tremendous residual value and a 4- to 5 percent Cap rate, which is highly sought after by passive investors like (my clients)," said Derrick Schroeder, broker with Solid Investments who represented the buyers.

The seller, South Carolina-based Coffee Street Properties LLC, is an affiliate of developer John Cothran of Cothran Properties, who previously paid $7.67 million in November 2010.

"I helped him buy this Walgreen's property in 2010 from GE Capital when the market was ripe. Over the last few years we've done a lot of transactions, and I put in his ear that we could market this for a nice profit," said Brett Chetek, listing broker on the property, who lead's Marcus & Millichap's The Chetek Group out of St. Louis and Miami.

Learn more about the split-zoning challenge this owner faces to redevelop a commercial property along a busy gateway thoroughfare of Winter Park.

"(Schroeder) delivered an all-cash buyer with no financing, which was very appealing to us, and we had it under contract within 30 days for very close to list price of ($10.95 million)," he continued. "Now Cothran will turn a 1031, buying a Cheddar's property in Hendersonville (Tennessee) on a longer lease, with a higher return."

The appreciation of the property over the past seven years offers a positive outlook for a local group of physicians who had their $3.5 million bid accepted on Monday by city commissioners for a vacant parcel directly east of the Walgreen's.

Have a tip about Central Florida development? Contact me at bmoser@growthspotter.com, (407) 420-5685 or @bobmoser333. Follow GrowthSpotter on Facebook, Twitter and LinkedIn.