POMPANO BEACH, FL-In its ongoing efforts to pull itself out of Chapter 11 bankruptcy protection, Winn-Dixie Stores Inc. has enlisted Melville, NY-based DJM Asset Management to sell its 787,500-sf warehouse/distribution facility at 1141 SW 12th Ave. The building is located on 45 acres in this severely land-constrained submarket.
The size of the building, and, "perhaps more importantly, the land, makes this a unique opportunity here, where there's virtually no land for development and a very tight industrial market," Jonathan Kingsley, managing director and EVP of Grubb & Ellis' South Florida operations, tells GlobeSt.com. "It's a phenomenal development site. I'm sure many developers have been eyeing it to see what Winn-Dixie would do and want to either work with the existing structure or scrub it for construction of a flex property, which would allow them to achieve rent rates to cover the price of the land."
Kingsley says land is selling for between $12 per sf and $15 per sf, which, in a land-buy would put the price tag at between $24 million and $40 million. Meanwhile, sales of industrial buildings are now commanding between $60 per sf and $80 per sf, he says, which could take the price tag to between $47 million and $63 million. Calls to DJM were not returned by deadline.
According to reports from several area brokers, the industrial bulk warehouse vacancy rate in this submarket is below 4%. Asking rent rates are at levels of between $6.75 per sf for bulk warehouse space and about $7.50 per sf for flex space.
Between April 1 and the end of June, the Jacksonville-based supermarket chain will consolidate its South Florida operations at its 961,690-sf facility in Miami. "Proceeds received from the sale of the Pompano distribution center will provide us with additional capital to help fund our remodeling program and other improvements," Peter Lynch, president and CEO, says in a statement. DJM is currently also helping to dispose of at least three other Winn-Dixie distribution centers along with seven outparcels and land, 35 retail leaseholds and a fee-owned store.
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