Winter Park accepts $3.5M high bid for W. Fairbanks lot by local physicians group

Winter Park commissioners voted Monday to accept the $3.5 million high bid by a group of local physicians for a city-owned parcel south of Martin Luther King Jr. Park, with plans for a new medical office building.

"We are very excited about the success of our bid and look forward to the development," Dr. Ravi Gandhi, partner with Orlando Neurosurgery and spokesman for the group, told GrowthSpotter on Monday night. "We will be raising private funding and then have a few local banks interested. We are interested in working with smaller banks who are interested in building a relationship with our group of investors."

The city began marketing in June the 1.51 acres at 1111 W. Fairbanks Ave., known as the former Bowl America site, which lies just east of the intersection with U.S. 17-92 (Orlando Avenue), and south of Comstock Avenue.

Commissioners chose two bidders from the original six at their Aug. 14 meeting to prepare a best and final offer for the property. The final review and vote was originally set for Sept. 11, but was delayed until Monday due to Hurricane Irma. 

ComTech Properties, Inc. and Verax Investments LLC offered the high bid of $3.5 million. ComTech is an affiliate of local commercial real estate broker and development consultant Don Ammerman, who is working on behalf of Verax, which is managed by Gandhi who has other physicians and non-physicians as co-investors.  

They've proposed a two-story medical office building of approximately 20,000 square feet. Gandhi said in August the vision behind his group's bid is to attract new medical service providers to Winter Park.

Gandhi's group offered to put up $50,000 in earnest money within two days of executing the purchase agreement, and another $50,000 within two days of the end of an inspection period, it told the city in an updated proposal letter on Aug. 25.

It will seek $2.625 million in financing, and close by paying the balance of $775,000. Total project cost is estimated near $11 million.

"We are hoping to finalize the development plan by the end of the year or early next year, and break ground by spring or early Summer 2018," Gandhi said.

The group will have 90 days following full execution of the purchase agreement to complete due diligence on the property, and retains the right to cancel the contract at any time during that period and have its money returned. It also holds the right to extend the inspection period an extra 30 days, due to potential market shortage of certain subcontractors. 

Potential tenants for Verax's building were described as a large medical operator with more than 65 years of experience, which would run an urgent care clinic in roughly half of the building, and high-end multi-disciplinary medical clinics in the other half.

Gandhi told GrowthSpotter on Sept. 8 that Orlando Health and Florida Hospital have been offered the lease opportunity and shown interest.

As a backup, Orlando Neurosurgery would take the space if one of the main hospital systems isn't signed, he said. The private practice currently owns a small stand-alone office a few blocks west on Fairbanks Avenue.

Orlando Neurosurgery would open its second location in the new building for a comprehensive spine health center that includes physical therapy, imagining, same-day clinic and advanced pain management services.

"We have not finalized a tenant as of yet, but have a few interested parties," Gandhi said Monday night. "This is a great location with a lot of potential, and we're looking for partnerships to lease the building but also to bring a business that will compliment us."

After accepting the Verax Investments offer, staff will work with Bobby Palta, first vice president with CBRE Orlando and commercial real estate advisor to the city, and the city attorney to prepare a sales contract and prepare an ordinance required to transfer the property. 

The other finalist offer was from Orlando-based Tower Realty Partners, Inc., an owner/operator of office buildings across Greater Orlando. It made an all-cash bid of $3.1 million, with a 45-day due diligence period and claim of a pre-lease agreement for half the building by Advanced Dermatology and Cosmetic Surgery

Commissioners did not discuss the merits of each bid and proposal during the Monday meeting, ultimately voting on a motion to accept the highest offer.

They briefly debated whether to delay the decision to choose a purchase offer until a final site plan for the city's new library and events center at MLK Park was submitted, to determine if future improvements to the park would require extra stormwater retention on the 1111 W. Fairbanks Ave. site.  

Editor's Note: This story was updated on Sept. 29 to clarify the makeup of partners in Verax Investments LLC. 

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.

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