$417-Per-SF Strip Center Sale Sets Record

Milan Properties West LLC of Los Angeles paid seller-developer Shops at Lakeland Square LLC $3.44 million for the 100%-leased, 8,248-sf Shops at Lakeland Square. The six-month-old asset is located at the main entrance to the 900,000-sf Lakeland Square Regional Mall. Tampa Advantis executive directors Brad C. Luger and Larry Randolph rung up the $417.07-per-sf sale on the Lakeland property.

That deal trumped the $401.96-per-sf price recorded by the Pocklington Pocklington & Forster Retail Investment Group on Oct. 18, 2005, as GlobeSt.com previously reported.

Both high-priced properties were on the small physical side, as retail centers go, but commanded the record price because of their high stable rents and cash flows, brokers involved in the deals tell GlobeSt.com. The Lakeland transaction had a sales cap of 7%. Randolph says the $417.07-per-sf price is "the highest we have seen in this market."

The Shops at Lakeland Square has only three tenants who pay an average asking base rent of $30 per sf. The tenants are Verizon Wireless, Supercuts and Mattress Firm. Randolph attributes the high per-sf sales price to the property being "an outparcel mall site location and three creditworthy tenants." The property, on a .94-acre pad, is at 3870 US 98 North.

Randolph tells GlobeSt.com the property was on the market for 90 days. The deal took another 45 days to complete, from letter of intent to closing. Luger and Randolph represented buyer and seller. The deal was done at this time to qualify for a 1031 tax exchange, Randolph says.

His colleagues in the Orlando GVA Advantis office brokered the $10.25-million sale of the 25,500-sf Sand Lake Plaza at 1431 Sand Lake Rd. in southwest Orlando. Sand Lake Plaza LLC, a private Boca Raton-based investor, sold the center to Retlaw Ltd. Partnership of Beverly Hills, CA. Retlaw is owned by the family of the late Walt Disney, as GlobeSt.com previously reported.

Both high per-sf price sales were not surprising to Sasha Pardy, director of research and marketing in the Orlando office of GVA Advantis. "Unanchored and freestanding retail buildings, which private investors can afford, accounted for 61% of all retail investment transactions" in metro Orlando in 2005, she says. "They continue to be the most popular retail investments."