Commercial Land Sales Down in Volume But Up in Price

"Because of the increasing growth and decreasing supply of commercially zoned land, many developers are being forced to purchase agriculture parcels and go through the rezoning process," notes Jeffrey Sweeney, managing principal and president of Grubb & Ellis/Commercial Florida. "With Orange County's fast-paced growth, the amount of available land [in the county] is dwindling and buyers are beginning to look for development opportunities outside the core county."

Sweeney says the first quarter saw "a rise in land value in all product types, even though the total dollar volume was down." Commercial land in Orange County is selling for premium prices with the average sales price per sf rising $22 at quarter end. The average sales price "rose slightly in Lake and Seminole counties but remained flat in Osceola. The total number of sales dropped in all counties except Seminole," Sweeney says.

Residential land sales were down "despite the booming multifamily development market as many developers are opting to convert existing apartment buildings or hotels to condos, rather than build new structures," Sweeney says. New residential construction is still strong, he adds, "even though there was a slight decline in the number of overall building permits issued, compared to first quarter last year."

First-quarter land sales totaled 41 in Orange, three in Osceola, two in Lake and five in Seminole county compared to 273 sales in Orange County in first quarter 2004, 17 in Osceola, 36 in Lake and 14 in Seminole. Per-sf-prices in first quarter this year in Orange averaged $26.11, $5.47 in Osceola, $3.33 in Lake and $11.14 in Seminole. In the first quarter of last year, Orange per-sf-prices averaged $7.24, $4.51 in Osceola, $2.16 in Lake and $5.38 in Seminole.

The average first-quarter, per-acre price in Orange County was $1.13 million, $238,095 in Osceola, $145,236 in Lake and $485,448 in Seminole. Those numbers compared with average first-quarter 2004 per-acre prices of $315,523 in Orange, $196,310 in Osceola, $94,028 in Lake and $234,282 in Seminole.