Highwoods Sells Orlando Office Buildings for Nearly $33M

ORLANDO, FL—The two building Windsor and Berkshire at Metrocenter here has been sold in a deal valued at $32.5 million.

Commercial brokerage firm CBRE reported the sale transaction of the fee-interest of 182,753-square-foot Class A property at 2101 Park Center Drive and 2145 Metrocenter Boulevard to Metrocenter Office, LLC. The brokerage firm did not disclose the identity of the seller. CBRE’s Ron Rogg and Chip Wooten represented the seller in the transaction.

However, Highwoods Properties Inc. of Raleigh, NC reported it had sold the Orlando office complex in its first quarter financial results released on April 23. The REIT stated the transaction closed on April 12.

The property is currently 89% leased to 11 tenants. The South Orlando property benefits from access to Orlando’s main thoroughfares – Interstate-4, Florida Turnpike, and the East/West Expressway (SR 408). The Orlando International Airport and Downtown Orlando are also 20 and six miles away, respectively. Situated within the mixed-use community of MetroWest, the property is surrounded by executive housing and retailers such as Starbucks, Tijuana Flats, and Chipotle in addition to several entertainment options, including a Robert Trent Jones golf course less than 2 minutes away.

“Given the strong historical occupancy and current market conditions, the buyer will benefit from ownership of these assets in a rising rate environment with strong predictable income,” CBRE executive vice president Rogg says. He adds that more than seven acres are available for future development, giving the future ownership the ability to scale up to 407,753 square feet of office space at the property.

In January, Highwoods Properties sold Two Point Royal, a 124,000-square foot building in Alpharetta, GA, and Highwoods Preserve I, a 199,000-square-foot, single customer building in northeast Tampa, for combined sale price of $54.5 million.

Highwoods announced for the first quarter of 2019, net income available for common stockholders was $7.3 million, or $0.07 per diluted share, compared to net income of $32.4 million, or $0.31 per diluted share, for the first quarter of 2018. For the first quarter of 2019, FFO was $76.5 million, or $0.72 per diluted share, compared to FFO of $90.7 million, or $0.85 per diluted share, for the first quarter of 2018.

Company revenues were impacted by the sudden closure of Laser Spine Institute in March, which leased Highwoods Properties’ 5332 Avion Drive, a 176,000 square-foot, six-story building in Tampa’s Westshore submarket. The building, developed by Highwoods, had been used by Laser Spine for both its company headquarters and an ambulatory surgery center. After the market closed on March 1, 2019, Laser Spine announced it would immediately discontinue its operations. This unexpected announcement affected all of its locations.