HIGH SPRINGS, FL-A private Boca Raton investment group has picked up a 96%-leased, 10-tenant, 113,764-sf strip shopping center in this North Florida town of 8,500 permanent residents for $5.5 million or $48.35 per sf--about $15 per sf below replacement cost, area construction sources tell Globest.com.
The 35-year-old, 96%-leased property, anchored by a Winn-Dixie supermarket, was sold by the original developer, High Springs Properties Inc. of Jacksonville. The deal was done at this time because the developer "wanted to spend less time running the property and more time traveling," Jeffrey L. Pocklington, a director at Pocklington, Pocklington & Forster Retail Investment Group, tells GlobeSt.com.
Martin Forster, another Pocklington Group director, says "We were fortunate to have a strong buyer that knew exactly what it wanted to do with the property. That's why they proceeded with the transaction, although Winn-Dixie filed Chapter 11 during the due diligence period."
On the replacement cost comparison, J. Michael Pocklington, also a Pocklington Group director, tells GlobeSt.com, that while $48.35 per sf is below replacement cost, "keep in mind, however, that in smaller markets where average rents are lower, you will always have a lower cost per sf. "
The broker adds, "In the final analysis, the deal was not about cap rates and returns. It was about the buyer acquiring a well-located, stabilized asset with a long history of steady sales and the seller getting a strong price for a property anchored by a tenant with well-publicized financial difficulties."
The Pocklington Group, part of the Orlando office of Advantis Real Estate Services Co., negotiated for the seller. The buyer group represented itself. The North Florida property is 40 miles north of Gainesville and about 200 miles northwest of Downtown Orlando.
The property was on the market for six months and took another 85 days to complete, from contract signing to closing.
In an unrelated transaction, Advantis brokers closed on the $15.95-million sale of the 108,685-sf Monroe Park Tower in Tallahassee. Capital Partners of Orlando paid Tricony Florida Corp. of Palm Beach $146.75 per sf for the Downtown Tallahassee office building.
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