Parkway Closes on $22.5M Tampa-Westshore Office Building Purchase

By Georgiana Mihaila, Associate Editor

Parkway Properties Inc.has closed on the acquisition of the Westshore Corporate Center in Tampa for a net purchase price of $22.5 million. Parkway Properties has recently been on a shopping spree.

The company has first shown interest in the 170,000-square-foot building in early October; “Westshore Corporate Center is well located within the Westshore submarket and is one of our third-party managed assets in the former Eola Capital portfolio, allowing Parkway to achieve attractive pricing given the $850,000 credit we will receive at closing,” said Parkway’s President and CEO, James R. Heistand, at the time.

Located at 600 N. Westshore Blvd., Westshore Corporate Center was built in 1988 and is currently 77.7 percent leased. Parkway expects the property to generate a 2013 estimated cash net operating income yield of approximately 8.5 percent based on the net purchase price. The company will own 100 percent of the asset and plans to assume the in-place first mortgage secured by the property, which has a current outstanding balance of approximately $14.5 million with a fixed interest rate of 5.8 percent and a maturity date of June 1, 2015.

Westshore Corporate Center is currently managed by Parkway Realty Services and was formerly part of the Eola Capital LLC portfolio before Eola merged with Parkway in May 2011. Given the agreement formed between Parkway and the former Eola principals in December 2011, 100 percent of any proceeds received by the former principals were granted to Parkway. Therefore, Parkway will only be required to pay a purchase price of $22.5 million, which is net of an $850,000 credit that would have otherwise been paid to the former Eola principals.

In its effort to pursue high-quality assets, Parkway Properties has also announced entering into a purchase and sale agreement to acquire Phoenix Tower, a 626,000 square foot office tower located in the Greenway Plaza submarket of Houston for $124.5 million; Tower Place 200, a 260,000 square foot office tower located in the Buckhead submarket of Atlanta for $56 million; and 525 North Tryon, a 406,000 square foot office tower located in the central business district (CBD) of Charlotte, N.C. for $47.4 million.

Image: Westshore Corporate Center via tampachamber.com

Parmenter Realty Buys Two Tampa Office Buildings from Prudential for $85M

By Georgiana Mihaila, Associate Editor

Miami-based Parmenter Realty Partners added 494,813 square-feet of office space to its portfolio when it purchased two Class A office buildings on Rocky Point Island in Tampa, Fla. for $85 million.

Seller Prudential Real Estate Investors first started looking for a buyer for the Island Center and Waterford Plaza buildings in mid-2009, but withdrew the properties from the market only to restart marketing efforts approximately four months ago.

Mike Davis, executive director of Cushman & Wakefield’s Southeast Capital Markets Group—the firm that negotiated the transaction on behalf of the seller—said that “The capital markets again view Tampa positively from a long-term investment perspective.  Accordingly, well-positioned core assets are in high demand.”

The Cushman & Wakefield’s Southeast Capital Markets Group sales team was formed by Mike Davis, executive director, Rick Brugge, CCIM, associate director and Michael Lerner, senior director. Cushman & Wakefield was assisted by CLW Real Estate Services.  The sale price of $85 million equates to approximately $169 per square foot.

Totaling 494,813 square feet, Island Center and Waterford Plaza are both Class A, 12-story office buildings and have been built in 1985 and 1986 respectively. The 249,797-square-foot Island Center is located at 2701 Rocky Point Drive and spans over 2.9 acres, while the Waterford Plaza, located at 7650 Courtney Campbell Causeway, encompasses 245,016 square feet.

The two buildings were 85 percent leased at the time of the sale, with a tenant roster that includes URS Corp., Cigna Healthcare, GXS Inc. and TCM Bank.

Image: Island Center via LoopNet

Richman Group Plans $45M Apt. Community on Industrial Park Site

By Georgiana Mihaila, Associate Editor

The Richman Group of Florida unveiled plans for a $45 million luxury apartment community named Gateway Centre. To be located on the 40-acre site of a former industrial park, the four-story complex will rise on Gandy Boulevard. The site was purchased by The Richman Group last month from flea-market magnate Hardy Huntley.

According to Tampa Bay Times, Winter Park-based Douglas Partners had similar plans for the property, but as the deal failed to materialize, the owner started seeking new investors for the Pinellas County property.

Gateway Centre will consist of 432 units sized between 870 and 1,500 square feet, featuring nine-foot ceilings and granite countertops, with rents ranging from $1,000 to $1,800 per month. Amenities will include a clubhouse, an outdoor kitchen, tennis courts and a nature trail.

Developer The Richman Group will break ground on the project next year. Plans call for a 2014 opening date, when the first phase of the Gateway Centre—consisting of 320 units—is scheduled for completion.

No multifamily projects were delivered in the Tampa-St. Petersburg metro area in 2011. By contrast, Marcus & Millichap predicts that market-rate rental inventory will expand by 1 percent during 2012 with the completion of 1,500 units. Also this year, permitting remains on track to increase by more than 50 percent to 3,600 units of multifamily housing. According to the same report, approximately 2,000 units were under construction at the end of the second quarter, representing a potential 1.3 percent increase in market-rate stock. The total includes 344-unit second phase of the Circle at Crosstown in the Brandon/Plant City submarket, which broke ground in the second quarter. Projects containing 1,500 rentals will come online in the metro during 2012, including more than 1,000 units in Hillsborough County.

Chart courtesy of Marcus & Millichap

Construction Starts on $225M St. Joseph’s Hospital-South in Riverview

By Georgiana Mihaila, Associate Editor

A groundbreaking ceremony marked the start of construction for the first not-for-profit hospital to serve southern Hillsborough County—the $225 million St. Joseph’s Hospital South.

St. Joseph’s Hospital-South, part of BayCare Health System— a leading community-based health system in the Tampa Bay area—will be a full-service hospital offering a wide range of services from emergency care and women’s services to surgery and intensive care. The property will be located at 6901 Simmons Loop Road in Riverview, Fla., easily accessible via I-75 and Highway 301.

The 72-acre campus will include a medical office building that connects to the four-story, 352,000-square-foot hospital for convenient access to pre-procedure testing and physician offices.  The site also will be home to a 40,000 square-foot, free-standing physician office building, which is expected to open in 2013 with imaging and laboratory services as well as primary care and specialty physician offices.

Hospital president and CEO, Isaac Mallah, said his staff has worked for more than seven years to get the necessary approvals to build the hospital.  But the idea to build in this location was conceived in the mid 1980s, when the land was acquired.

In addition to providing health care to area residents, the project is expected to be a welcome addition to the business community. “Think about it: $225 million invested here and the ripple effect that will have,” said Congresswoman Kathy Castor during the groundbreaking ceremony.  “First: construction jobs, boosting small business throughout the community. Then, the medical professionals that will move here and their families that will grow up here. This hospital is going to be an anchor for economic development for the SouthShore community and all of southern Hillsborough County.”

St. Joseph’s Hospital-South will join the other 10 not-for-profit hospitals in the BayCare Health System network in 2015.

Taubman, Benderson Break Ground on $315M Shopping Center in Sarasota

By Georgiana Mihaila, Associate Editor

The Mall at University Town Center is one step closer to fruition as developers Taubman Centers Inc. and Benderson Development Company LLC broke ground on the $315 million shopping center during a ceremony held on Monday.

The ceremony was attended by community officials including Sharon Hillstrom, Manatee Economic Development Corp.; Mark Huey, Economic Development Corp. of Sarasota County; Christine Robinson, Chair of Sarasota County Commission; and Congressman Vern Buchanan. It culminated with a $10,000 donation on behalf of the mall to the Education Foundation of Sarasota County—a non-profit organization dedicated to quality public education for all children.

The Mall at University Town Center will be a state-of-the-art, two-level, enclosed mall featuring an 80,000-square-foot Saks Fifth Avenue, a 180,000-square-foot Dillard’s and a 160,000-square-foot Macy’s. The $315 million shopping center will include more than 100 specialty stores and restaurants, approximately half of which are anticipated to be new to the market.

Located at I-75 and University Parkway, the area’s most heavily traveled interchange, The Mall at University Town Center aims at becoming the dominant fashion shopping destination in the growing Sarasota region. Analysts predict the project could even become the busiest retail hub from Tampa to Fort Myers.

“The Mall at University Town Center will be a legacy project for Sarasota County,” said Christine Robinson, Sarasota County Commission Chair. “It’s an economically diverse development offering new jobs and new job opportunities. The mall was created by a visionary public-private partnership and based on a sustainable concept that will become a national benchmark for combining a world-class rowing and recreational facility with a world-class commercial and residential center.”

Slated for completion in October 2014, the retail center is expected to pump more than $400 million a year into the regional economy, contributing significantly to the growth of nearby commercial centers, creating thousands of new jobs and boosting property values.

Images via Taubman Centers