The investors' group, Lake Mary Professional Campus LLC, plans to break ground Feb. 27 on a 10-building campus on 10.5 acres at the southwest corner of Interstate 4 and Lake Mary Boulevard in this Orlando suburb. The group paid Colonial Properties Trust of Birmingham, AL $4.1 million, or about $390,476 per acre, for the strategically located land.
Projected condo prices are $145 to $175 per sf at the four one-story and six two-story structures, David Barley, the broker in charge of Palm Beach Land Trust, tells GlobeSt.com.
The investors are looking for a second site in metro Orlando and also plan to develop an office condo on a 32-acre tract they are buying at the Lakewood Ranch community at Interstate 75 and University Boulevard in Sarasota, FL. Palm Beach Land Trust, based in Winter Park, FL, is the project manager and exclusive sales agent for all of the investors' ventures.
"This is the first office condo project in Central Florida for these investors who have developed three similar projects in South Florida," says Barley. "They were very impressed with the type of development in the Lake Mary/Heathrow submarket and felt that this location would create great value for the condominium buyers and position the professionals close to their customers."
Barley's son, Charley, a senior associate at Palm Beach Land Trust, tells GlobeSt.com "an office condo is not for everybody, but it could well be for an entrepreneur, a sole practitioner or the owner of a closely held company who is looking to invest in property." He says office condo buyers face the same questions as home buyers. That is, "do you want to continue to rent or do you buy your own home and get the benefits of ownership," Charley Barley says.
The office condo buyer will be one who needs 2,000 sf, 4,000 sf or 6,000 sf, "not 15,000 sf, 20,000 sf or 30,000 sf, which is where the market is soft now," Charley Barley says. "Our customers usually live only five to 10 miles from work and need between 1,400 and 7,000 sf of space. Usually, they're well-financed. For them, a condominium is a wealth-building vehicle."
"If you own your own company, you might as well pay rent to yourself as to someone else, plus owning something that will appreciate over time," he adds.
His targeted buyers are stable businesses with five to 20 employees--often accounting and legal firms, doctors and dentists, owners and operators of regional restaurant chains, title companies, financial planners and other professional groups.
Lake Mary was selected for the venture because the city is "one of the fastest and best-planned areas" in metro Orlando, Charley Barley says. The city has a permanent residential population of 13,000 and a daytime professional and residential population of 35,000, according to the city manager's office.
"In a weak office market, developers are developing office condominium space is fast-growing, blue-chip niche areas," such as Lake Mary, Charley Barley adds.
He notes that for most small business owners, "an office condo is a good place to park money for the long term, and with the low cost of capital right now, financing is very attractive." Small business owners who qualify can purchase their offices with 10% down.
"Savings over rent can be as much as 40% or more," Charley Barley says. "Why pay for your landlord's retirement?
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