PREIT Closes on 540 Acres for Nearly $22M

The Philadelphia-based REIT is awaiting final approvals from Alachua County and the Florida Department of Community Affairs for the development of Springhills. The mixed-use community could have a final estimated development cost of $420 million, area industrial brokers tell GlobeSt.com. However, PREIT executive vice president of development Doug Grayson tells GlobeSt.com "it is much too early for us to get an estimate" on development costs or the build-out timeframe.

If the two agencies approve PREIT's development request, Springhills could have a maximum 2,200 multifamily units and single-family residences; 1.48 million sf of retail and other commercial space; 182,000 sf of office and institutional facilities; 300 hotel rooms; and 440,000 sf of industrial space, says Grayson. "Those were the numbers in a Jan. 19 approval" by the agencies."

Area construction sources tell GlobeSt.com that if all of the authorized space is developed over a 10-year to 15-year period, estimated hard construction costs for the shelter component of 2,200 multifamily units and single-family residents could come in at a minimum $90,000 per unit or an estimated total $198 million.

The 1.48-million-sf retail and other commercial category could be built at about $85 per sf or an estimated total of $125.8 million. The 182,000 sf of office and institutional facilities would have an estimated hard cost of $36.4 million based on an estimated $200 per sf.

The 300 hotel rooms, depending on their luxury level and size, could ring in at $37.5 million based on an estimated $125,000 per room. The 440,000 sf of industrial product could probably be built for between $40 and $50 per sf or an estimated total $22 million.

Grayson says, "We are pleased to have reached this milestone with Alachua County and look forward to finalizing the development program and moving ahead with the creation of Springhills in Gainesville." Springhills will be eight miles from the University of Florida which has 48,000 students and 12,200 employees; Shands Hospital with 7,500 employees; and the Alachua County School Board with 4,200 workers.

The proposed development site is at Interstate 75 and 39th Avenue. Grayson says Springhills initially received development approvals in 1998. PREIT signed a purchase contract for the land in 2001. Since then, the REIT has worked with county officials to amend the approved development program into "a more comprehensive mixed-use" development plan, Grayson says.

In January, county commissioners voted to transmit program amendments to the Florida Department of Community Affairs because the total size of the PREIT development would put it into a development of regional impact category, Grayson says. He adds that permitting, designing and leasing are "expected to occur" during 2006 and 2007, with initial occupancies expected in 2008 and 2009.

Gainesville, with an estimated permanent population of 100,000, is considered the commercial center for North Central's 12 counties, according to local chambers of commerce sources.