Stiles Corporation, a Fort Lauderdale-based real estate development firm, has a Letter of Intent (LOI) in place to develop roughly half the property on N. Orange Avenue that the Orlando Sentinel leases from Tribune Real Estate Holdings, a highly-placed source with knowledge of the deal has confirmed for GrowthSpotter.
The land with an LOI is the 7.7-acre south lot on N. Orange Avenue between E. Concord and Amelia streets, which includes a large parking lot now used by Sentinel staff and three small office buildings.
Tribune Real Estate's northern block between Colonial Drive and Concord Street (10.99 acres), where the newspaper offices and printing press are based, aren't part of the pending LOI.
Through its development division, Stiles Corp. is now in a due diligence period of 60 to 90 days to evaluate the property, decide its best and highest use and whether it will develop the south block alone, or in partnership with Tribune Real Estate, a subsidiary of Tribune Media Co.
A spokesman for Tribune Media declined to comment on market rumors regarding the property's sale, and a spokeswoman for Stiles Corp. declined to comment Tuesday regarding the LOI.
Altamonte Springs-based Shannon Surveying was on the southerly block in recent weeks measuring the property for a client. Owner Jim Shannon declined to confirm his client, citing a confidentiality agreement.
The Orlando Sentinel, owned by Tribune Publishing, has a 10-year lease on the space it occupies on the 18.69 acres spread across two blocks on N. Orange Avenue. The land is owned by Tribune Real Estate Holdings, a subsidiary of Tribune Media out of Chicago. That company is formerly Tribune Co., the Sentinel's former parent company.
That rough proposal included 318 apartments, 140,000 square feet of office space, about 28,000 square feet of retail and a 910-space parking garage, with buildings of four to five stories. Orlando-based Kimley-Horne Associates Inc. filed the plans last year for Tribune Real Estate.
While not involved with the seller or potential developer, Steve Belflower, vice president of Hunton Brady Architects, said Thursday he'd advise a developer to think bigger for the parcel – at least five stories bigger.
"I'd approach that block with a plan for at least 10 stories of residential, retail and office mix with parking," Belfower said. "The challenge is, do you fill that land up with four- to five-story buildings that you know are in demand and will be profitable now, or do you try and get out ahead of North Downtown's future?
"I would (advise a client) to forecast a few years out for North Downtown, and leverage this parcel for the future density that's coming," he continued. "As downtown redevelopment connects at the center and pushes growth north, I believe taller office and residential buildings will be needed."
Developer Craig Ustler, whose Ustler Development has been a leading force in developing the North Quarter neighborhood just north of the Sentinel blocks, said the apartment investment market is so strong, his development peers now joke that "all signs point to multi-family."
"But to take a high-rise risk there is dicey," he said. "Other high-rise (apartment) buildings planned for downtown are in areas proven to command a rent premium, like sites around Lake Eola. I'm not sure this subdistrict is there yet."
Ustler noted that building code requirements also become more strict once developers plan above 75 feet, or roughly five stories. That's why most downtown apartments are at that five-story limit, or push to 20-plus stories for economies of scale.
In Tribune Real Estate's redevelopment plan filed last year, the second phase, focused on the northern block between Colonial Drive and Concord Street where the Sentinel's offices and printing press are (10.99 acres), called for the same amount of parking, retail and office as the first phase, along with 428 apartments and a 144-key hotel.
Stiles Corp. has offices in seven Florida cities, including a property management office in Orlando, along with Charlotte and Nashville.