A New Jersey-based real estate investment trust paid $6.825 million on Friday for the land and a net-lease from owners of the Firkin & Kegler Family Entertainment Center in east Orlando's Waterford Lakes.
Located at 12850 Waterford Lakes Parkway, the 3.32-acre parcel lies on the eastern edge of Waterford Lakes Town Center.
The buyer was an LLC affiliate of Essential Properties Realty Trust, a net-lease real estate platform that invests primarily in single-tenant assets in the retail and industrial sectors, with more than 450 commercial property assets nationwide. The trust itself is an affiliate of Stonebriar Commercial Finance, a leading independent middle market commercial finance company.
"We like the Orlando market a lot, it has great demographics and economic drivers that create nice long-term stability and help support properties like this," president and CEO Pete Mavoides told GrowthSpotter.
Essential Properties Realty Trust will continue seeking single-tenant net-lease acquisition opportunities in Greater Orlando, he added, and favors more than anything "a high-quality operator" as tenant of the property, signaling a preference for stability over value-add.
The sellers were a trio of partners that bought the land in 2006 for $2.5 million, and built the Firkin & Kegler Family Entertainment Center in 2007, which features bowling, an arcade, billiards, pub and private event space.
That partnership was dissolved earlier this year, leaving Whitney Harp as sole owner of the business, and a land sale as an agreed upon exit strategy for the group.
"In the bowling world if you were to sell this property to an entity like a bowling company you wouldn't get the same value as if you sold it to a net-lease real estate investor," Harp said. "I wanted to stay with the business and keep it operational, and this sale leaseback gave us the highest value."
Harp's entertainment center business signed a new 10-year lease at time of closing with Essential Properties' buyer affiliate, which carries two additional 10-year extension options. The purchase offered an 8 percent cap rate, said Harp, who also holds his commercial real estate license and works independently.
Stan Johnson Company served as listing agent for the property.