An affiliate of Orlando-based Millenia Partners paid $3.8 million on Dec. 28 for two out-parcels totaling 4.14 acres south of Artegon Marketplace on N. International Drive, with plans in development for three restaurant lot leases, principal Brian G. Grandstaff confirmed for GrowthSpotter on Wednesday.
"We'll submit a master plan to the city soon, we've had a pre-app meeting that went favorably," he said. "The intended purpose of these undeveloped out-parcels had always been retail or restaurant supportive of the mall. The (purchase) price may be seen as high for raw land, but for shovel-ready parcels like these we think it was within market value."
Grandstaff teamed with Ken Bullock out of Millenia Partners' Dallas office on the acquisition, and Mary Ashy of Orlando's Elite Land Solutions, who brokered the deal.
The seller, an affiliate of New York-based Lightstone Group, had bought the former Festival Bay Mall and its outparcels in December 2010 for $25 million, and poured another $70 million into remaking and rebranding it as Artegon Marketplace.
"We identified the property six months ago as a logical, viable opportunity in what we saw beginning to happen on the northern side of I-Drive, even before the I-4 flyover bridge (to Grand National Drive) was identified," Grandstaff said. "We cold-called (Paragon Outlet Partners), and they showed a need and interest in selling, which was rather fortunate for us."
Grandstaff and his team have already signed Pollo Tropical for one of three restaurant ground leases for the 4.14 acres. Roughly 3.5 acres remain for the remaining ground leases, he said, with the group in talks with other national restaurant chains.
Bullock filed a Form D with the Securities and Exchange Commission on Dec. 23 for the buyer LLC, KMB I-Drive Investors, which offers insight into $4.3 million in private equity financing that its trying to raise. The company financed itself with $3.9 million, or 90.7 percent of the fundraising offer.
Grandstaff said the development has a projected budget of $4.3 million. Commitments have been made for the remaining $400,000, but a need for the additional capital wasn't immediate.
A replat of the property earlier this year by Artegon Marketplace's ownership set the stage for anchor tenant parcels to be sold. The two anchor tenant parcel sales totaling $30 million have already recouped the $25 million paid for the entire shopping mall.