South Florida investors enter flex/warehouse market with Altamonte Springs acquisition
By Mike Salinero
May 24, 2019 at 3:46 PM
SunCap Real Estate Investments, a Fort Lauderdale-based investment firm, recently purchased 186,000 square feet of flex-warehouse and office space on Douglas Avenue in Altamonte Springs.
The investment group paid $14.85 million for Altamonte Commerce Center, an eight-building complex, according to a deed signed May 20 and filed a day later in Seminole County. The buildings, constructed in the 1970s and 1980s, are all located on Douglas Avenue, north and south of West Central parkway, and just west of I-4.
The seller was EastGroup Properties LP, a self-administered equity real estate investment trust based in Ridgeland, Miss. EastGroup has owned the properties since 1999.
SunCap has been purchasing shopping centers in the Greater Orlando area for the past three or four years, but decided to diversify about a year ago, said Brian Mark, one of the firm’s principals. Mark said the asking price was right in the firm’s “sweet spot.”
“We like the location, that was a big attraction for us and the cost: $80 per square foot,” Mark told GrowthSpotter. “You couldn’t buy the land and replace it for that cost. Once you factor in the cost of land in that location, you would probably be north of $100 per square foot.”
The buildings acquired by SunCap are almost fully leased with just 9,000 square feet still available, said Lisa Bailey, a principal at Avison Young, which will handle leasing and property management for SunCap. The firm was hired two years ago by EastGroup to perform the same functions.
Bailey said 63 tenants now operate businesses out of units at the commerce center, sized from 1,000 to 15,000 square feet.
“A lot of the tenants are local small-business owners,” Bailey told GrowthSpotter. “There are some bigger corporate offices there, but most are smaller businesses.
“Everybody would like to work close to home,” she added. “Many people who lease there live 15 minutes away, max.”
Mark said the buildings, despite their age, are in good shape and need only minor renovations. And the property is unique in an area where there are few similar industrial assets, he said.
“There is very limited competition in that area,” he said. “That’s what we really like.”
SunCap will continue to seek industrial properties for sale in the Orlando area, Mark said.