Madison paid merchant builder Parkland Development Corp. of Boca Raton $38.4 million, or $100,000 per unit, for the 95%-leased, three-story property at 5443 Vineland Rd. The 55-acre property is close to Interstate 4 and the Disney theme parks.
The Chicago and Washington, DC offices of Holiday Fenoglio Fowler LP negotiated the deal for Parkland. HFF senior managing director Matthew Lawton and director Dave Nachison represented the seller.
Lawton was not surprised at the premium price paid for the property. "The condo conversion market continues to drive the pricing on for-sale rental properties throughout the country, including the Northeast, Southern California, Chicago and the Florida markets," Lawton tells GlobeSt.com. "If a converter feels an asset is a good candidate, the conventional multifamily operators typically cannot compete from a pricing standpoint."
Cypress Fairway was on the market for three months. The transaction took 75 days to complete, from contract signing to closing. "It was a direct deal with HFF representing the seller that solicited the offer from multiple condo converters and timeshare operators," Lawton says. Madison represented itself in the transaction.
The projected retail price range of the converted units is still being determined. The conversion is expected to begin during the winter. "It should take several years to sell out," Lawton says. The converted property will have the same number of units as the apartment complex. "There is also additional land to build 50 more units or more," the broker tells GlobeSt.com.
"Cypress Fairway was originally designed and constructed to timeshare specifications and the added quality will make this an outstanding condominium community that will appeal to purchasers," Lawton says. The average unit size is 1,029 sf and has fully sprinklered units that include intrusion alarms, screened patios and solariums with views of the neighboring PGA Signature golf course. Community amenities include a clubhouse, tennis courts, two swimming pools and use of the adjacent Cypress Creek Country Club and Golf Course.
This is Madison's first metro area acquisition. The deal was done at this time "to maximize investment returns" for Parkland, Lawton adds.
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