This is the most recent rent and sale data on Office, Industrial, Retail, Shopping Center and Vacant property for Tampa, Florida produced by FGCAR and Catylist.
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Date: May 28, 2010
BUYER: Kforce Services Corp. Tampa, FL
SELLER: iStar CTL East Palm — Tampa LLC
PROPERTY: 1001 E. Palm Ave., Tampa
PRICE: $28.5 million
PREVIOUS PRICE: $1.25 million, September 2000
PLANS, DESCRIPTION: Kforce Inc. purchased its headquarters in Ybor City for $28.5 million.
The price equated to $213 per square foot.
The four-story, 133,660-square-foot building was originally built in 2001. It occupies a 6.37-acre parcel and features a 4,200-square-foot fitness center, 100-seat cafeteria, coffee bars on each floor and an outdoor basketball court.
Kforce previously leased the building from iStar, a commercial real estate firm.
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Date: June 24, 2010
BUYER: MCA Enterprises Brandon, Inc
SELLER: Florida Wings Group, LLC
PROPERTY: Brandon Crossroads
PRICE: $2.6 million
PREVIOUS PRICE: $.7 million, January 2004
PLANS, DESCRIPTION: The property includes 2.01 unesable acres of land, and is improved by free-standing, 6,600 square foot Buffalo Wild Wings restaurant built in 2004.
The price equated to $394 per square foot.
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Comments:
There were also a couple of sizeable trades on apartment complexes, recently. Providence Place apartments in Brandon, FL sold on August 4, 2010 for $30 million and Carrollwood Station Apartments sold for $18.9 million on August 6, 2010. It is good to see some of these larger trades begin to happen.
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The office vacancy rate in the Tampa/St Petersburg market area decreased to 14.1% at the end of the second quarter 2010. The vacancy rate was 14.2% at the end of the first quarter 2010, 14.1% at the end of the fourth quarter 2009, and 13.8% at the end of the third quarter 2009.
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It did not come as much of a surprise when GunnAllen Financial, Inc. finally closed its doors for business today. Regulators had been digging around the firm looking for net capitalization violations after Chairman John Sykes abruptly left at the end of the last year. With Sykes’ exit, the writing was on the wall that the firm’s future was in question and brokers began to leave the firm.
5002 West Waters Av
The real estate story behind GunnAllen is quite interesting. An affiliated entity purchased the building at 5002 West Waters in 2004 for $9.5m and leased the building to GunnAllen. The property had originally been owned by financially troubled Tropical Sportswear and the transaction was considered a distressed asset sale. A parking garage was added to the property and it was sold 2 years later at the top of the market for $7.4m, or $2.1m LESS than the original sale. A new lease agreement with GunnAllen was executed with the new owners.
GunnAllen management believed it would need the 117,000 sq ft property to accommodate its expansion plans. When the stock market imploded, the property became an albatross for the company, whose profits were heavily tied to the market. Management had been attempting to reduce costs associated with the build by either subleasing unused portions of the property or vacating the property entirely.
Regardless of the circumstances, Tampa will now have an estimated 400 additional unemployed people and 117,000 sq feet of office space on the market. The property will be a challenge to market. It is a Class A building, but the surrounding area is really better suited for light industrial or transportation, rather than an office fit for a white shoe law firm. There is a significant common area load on the building making it best suited for a single tenant, unless the price is at a significant discount to factor in the common area charge.
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“This is a generational opportunity for law firms, for those whose leases are up in the next couple years,” said Jack Lowell of Flagler Real Estate Services. “We’ve been through this a few times before in Miami. These cycles last for two to three years.”
This was a piece from the Miami Herald today. It is interesting to watch the way law firms are handling the current downturn in the Tampa Bay area. Some are looking for the 10 year leases to really capitalize on their positions in the market. Others are moving in to sub-leases at 30% below market rents, with 2 year terms. Confidence in the staying power of their firms is a big factor in which way they decide to go.
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We have a new listing. It is a PRIME retail/office space on Hillsborough Av in Tampa.
For further details, please see:
the Retail Space Website &
4123 W Hillsborough Av
Tampa, Fl 33614
For further details, please contact:
Eric W Odum, Broker
813.514.1070
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Commercial Real Estate Opinions
This is an interesting piece on the equity markets from today. Tony Dwyer of FTN Equity Capital and Lee Munson of Portfolio Asset Management finished their interview talking about the commercial real estate market. Granted, they were discussing the equity market surrounding REIT’s, which usually leads market fundamentals. Regardless, the two made points about the market that we have discussed in this forum. In a nutshell, here were their thoughts (you can click on the picture to watch the entire piece. They begin the meat of the real estate discussion at the 3:20 mark of the video):
I would add to their argument that institutional buyers have written down their fee simple real estate assets substantially and with the rise in the stock market are potentially significantly underweight real estate according to their investment policies. They could very well be looking to increase their real estate holdings in the near term.
In the end, the market is profoundly complex and resilient. In spite of all the negative press surrounding commercial real estate of late, this market may not behave they way many of the pundits are predicting, with a massive crash that jeopardizes the foundation of our financial system.
What do you say?
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Source: Florida Real Estate Journal and Cushman Wakefield
“The economy on both the national and the local Tampa Bay fronts has been nothing short of bleak during the first half of 2009. The area unemployment rate continued on a steep incline, jumping to 10.6%, up by 4.7% from the unemployment rate recorded at this point in 2008.”
“….The market continues to struggle with increased vacancy and rising sublet availability. Both the Central Business District (CBD) and non-CBD vacancies continue to climb, with the market-wide overall vacancy rate reaching 18.6% by the close of the second quarter of 2009. This is a slight seven-tenths of a percentage point increase over the first quarter, but a much more significant 5.0 percentage point spike from the same time last year.”
Comments: If you are a tenant searching for property, this is a great time. Keep in mind, Landlords are much more willing to negotiate free rent as opposed to lower rent. Lowering the base sets an adverse precedent in future negotiations with you and other tenants. Most landlords will have to renegotiate their mortgages in the next few years and it is much easier to explain free rent than reduced rent. Reduced rents can make a forward looking income statement look pretty ugly to a banker.
We have found deals as good as 6 to 12 months of free rent, for medium term leases (3-5 years).
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The Development Council team in Pasco County must be doing cartwheels over their most recent coup. T. Rowe Price will move their location to a 75 acre campus off of State Road 54, bringing with them 1500 jobs. Amprop is the developer on the project. Although it is not clear, in all probability, Pasco’s gain is Tampa’s loss. Currently, T. Rowe Price has an Investment Center located off of Boy Scout Rd., near Tampa International Airport. It is not public knowledge, as of yet, if the firm will relocate this space to the new Pasco campus. Common sense says a move is likely.
Source: Tampa Bay Business Journal
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A recent report found that Tampa’s daily parking rate ($15) exceeds competitive cities Atlanta, Charlotte,
Jacksonville, Raleigh and Dallas. I am not sure how much of an issue this is when companies are looking to relocate to Tampa, but I am quite sure it is an issue for real estate prices in the downtown submarket when compared to other submarkets. Westshore, the downtown market’s closest competitor, maintains average office rates at roughly $3/square foot higher than those Downtown. Increased convenience to the Interstate and Expressway are part of the reason for the higher rates, but parking in most of the Westshore district is typically included in the rent, while it is priced separately in the downtown market.
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Tampa Commercial Real Estate News