J&G Industrial Park in Holly Hill Florida has sold. The 38,5000 SF building sold on August 14th, for $1,000,000, or $26.50 per square foot. At the purchase price, the acquisition cap rate of 9.7%. The building was 85% occupied by 17 individual tenants at the time of sale. The Seller had owned and operated the industrial park for nearly 30 years, and the sale was driving by the desire to recycling the equity into less management intensive property.
The Sea Shell Villa, an eleven unit apartment building at 3760 S. Atlantic Ave in Daytona Beach Shores has sold. The property closed July 6, for $860,000. The property is located on the west side of A1A, with direct beach access. The Seller was Tom Thornton of Lockbourne Ohio, the purchaser was Ramesh Yeluri of Taylor Michigan.
This sale is significant for two reasons; first it represents another transaction by an out-of-state party making a significant investment in a beachside real estate. The Buyer’s interest was driving largely by the exciting pipeline of projects for beachside Daytona Beach. Secondly, the sale price represents a 7.6% capitalization rate. This is a near record low cap rate for a low-rise garden style multi-family property in the Daytona Beach area.
Charles Wayne Properties, Inc. is one of Central Florida’s largest commercial real estate brokers. It manages, leases or owns in excess of 1,500,000 sq. ft. of retail and office properties, and has offices in Orlando, DeLand, Melbourne, Ocala and Daytona Beach.
A retail building occupied by Walgreens located at 537 N. Atlantic Avenue in Daytona Beach has sold. The property closed Friday May 29th, for $4,550,000. The Seller was a local entity, GKM Investments LLC, who purchased the property in 2007 for investment purposes. The purchaser a California company 20th Street Development LLC, based in Beverly Hills. In addition to the Walgreens, the sale includes a second 7,200SF building leased to a gift shop.
Walgreens, CVS, and Rite-Aid drugstores continue to be desirable investment vehicles for commercial real estate investors seeking stable cash flow at well above bond market returns. The current six-month average cap rate on a Walgreens with 5 years or less remaining on the lease is 7.24%.
Tim Davis of Charles Wayne Properties Inc represented the parties in this transaction.
We have written a lot about current cap rates, the low(zero) interest rate environment, and how the commercial real estate sector will adjust once the interest rates move upward. Below is a nice chart created by Wells Fargo, showing the 5 major property classes of CRE, on a chart with the current 10-year treasury yield. As you can see, the risk premium (or spread) between the CRE products and the treasuries are still wider than they have been for the last 20 years.
Simply put, CRE is still a greater return on investment than treasury bonds by the widest margin in 20 years. There is room for interest rates to go up, and investors to still have substantial positive leverage on their investments at the current cap rates.
The oceanfront land located at 3167 S. Atlantic Avenue, in Daytona Beach Shores has sold for $2,950,000. The site features 235’ of frontage, and 275’ in depth to the seawall. The Seller, Strand Property Partners LLC, purchased the site in 2004 for the purpose of developing a 118 unit condo project. When the economic conditions derailed that project in 2008, the Owners decided to forgo development of the site. The Seller’s listed the property in May 2013 for $3,700,000.
The Buyer is the County of Volusia, who plans to develop the site into a public use facility, providing beach access and parking open to all residents and visitors of Volusia County.
Tim Davis represented the parties in this transaction.
501 Plaza Blvd in Daytona Beach has sold – the 1700 SF freestanding office building just off of Atlantic Ave, adjacent to Bel Air Plaza closed today for $105,000. The seller was ET Partners out of Knoxville Tennessee, who acquired the building via a bulk note purchase earlier this year which this asset was collateralizing.
The buyer is Timeless Touch Inc. They have no immediate plans for the building and like the investment opportunity the building poses.
Tim Davis of Charles Wayne Properties Inc was the broker of record in the transaction for ET Partners.
The 1.28ac parcel at 834 N. Atlantic Ave has sold for $2,200,000. This is just under $40/SF, and now the highest sale per square foot, compared to any of any of the sites 200′ or greater. The seller was DB Investments of Pinellas, who purchased the site as bank-owned foreclosure in July of 2011. This sale represents the first oceanfront land sale between 2 private parties since late 2007. It is also the first of the formerly bank-owned foreclosed parcels to re-trade from an pure investor to a group with development plans; this is a significant step forward for the beachfront property in Daytona Beach.
During the low part of the recession, there was a fair amount of negative publicity around the outside investment by private equity groups and real estate funds. The fears voiced at that time were that these outside investors would “sit on” the land for a decade or more, and that it would stall redevelopment of Daytona Beach. My counterpoint to those fears; Investors place money in assets seeking a desired rate of return. If that targeted return can be achieved in 20 years or 20 days, that is the event that triggers the sale the investment.
A Texas based real estate investment group, MDD Enterprises has purchased the building located at 912 S. Nova Road in Ormond Beach. The 6,000 SF single tenant building has a good local tenant in place, and represented a opportunity for the buyer to purchase a well-located building on a high-traffic arterial roadway. The purchase price represents a comfortable rate of return for an industrial warehouse building with a retail showroom/offices. Long term upside for the buyer lies in the Ormond beach location lending itself to future redevelopment of the site for a more intensive retail use. The buyer was represented by Tim Davis of Charles Wayne Properties.
Another building in the Ormond Beach Airport Industrial Park has traded, just 6 weeks after the sale at 30 Aviator. 4 Signal Blvd, totaling 11,600SF, closed yesterday at $480,000 or just under $42/SF. This one of multiple industrial sales over the $40 SF mark in 2014, demonstrating extended support of this price point. The Buyer is World Color, currently located in the park. They were in the market for additional space to facilitate growth. The seller was a real estate investment trust, American Environment Foundation. They decided this was an excellent price point for them to recycle their capital.
For other industrial warehouse information and listings – www.daytonawarehouse.com, or 386.566.4917
Very Rarely do you find high-quality automotive service buildings available for sale or lease in Ormond Beach – There are so few areas with the requisite zoning for these uses in Ormond – the opportunity to capitalize on a very clean second generation location could be very lucrative.
3,680 SF, with 5 service bay doors, on busy nova Road with over 29,000 cars per day. The property is available for lease at $18/SF Modified Gross – or for outright purchase at $750,000. A purchaser would also receive the Billboard income as an additional revenue stream.
Tim Davis – Charles Wayne Properties