Coral Gables-based Flagler bought Tampa's Bridgeport Center at the top of the local office investment market. Rather than letting the building languish amid falling property values, it put $1 million into improvements.
For the last three decades, Bridgeport Center has enjoyed an optimum location among Tampa's office buildings, between the WestShore Plaza mall and the onramp to the Interstate 275 bridge.
The nine-story building, with one side curved and the other flat, was highly regarded through two large-scale sales in the past decade. AEW Capital Management paid $24.2 million for it in late 2005, then sold it to Flagler Development Group for $29.5 million just more than two years later, at the peak of the Tampa Bay area's office investment market.
While some may argue, in hindsight, that Flagler overpaid for its first local acquisition, the Coral Gables-based company remains confident in the 183,000-square-foot glass-clad structure, one of the largest in the Westshore business district. It pledged to put $1 million worth of improvements into the asset and is almost finished returning the building to Class A status.
Renovations to Bridgeport Center have included replacing elevator cabs, upgrading the air-conditioning system and enhancing exterior landscaping. The last piece of the plan involves putting a new ceiling, lighting and flooring in the building's lobby.
“It is rare in today's market that a property owner can or will make such extensive improvements for its tenants,” says John Guitar, Flagler's vice president and Central Florida market officer in Orlando. Yet the expenditure is necessary to ensure all Flagler properties, totaling 13 million square feet statewide, are of the highest quality, he says.
Built in 1980 at 5201 W. Kennedy Blvd., Bridgeport Center is currently 85% occupied with 30,000 square feet of available office space, but was close to full when Flagler bought it in January 2008. Brokers considered the purchase price of $160 per square foot as a bellwether for Tampa office properties at the time.
However, property values have slipped substantially since, with the building's own assessed value now at $19.3 million, according to the Hillsborough County property appraiser's office.
Guitar says that has no bearing on upgrades to the building. “We want to make certain our current and future tenants have a modern, flexible office building that suits their overall needs and daily functions,” he says.
Amenities at Bridgeport Center include covered parking, 24-hour access, an onsite deli and onsite management. Its location is convenient to WestShore Plaza as well as a number of nearby hotels, including the Crowne Plaza next door.
The building's marquee tenants include Florida's Medicare Quality Improvement Organization (FMQAI), Delta Air Lines, Troy University and Thompson Publishing Group. CB Richard Ellis is in charge of leasing.
Asking rents for the building are listed as negotiable, while the entire Westshore office market, the area's largest with 12.5 million square feet, averaged $27 per square foot for Class A space through this year's first quarter, according to Cushman & Wakefield research. Overall vacancy in the submarket was around 18%.
Besides Bridgeport Center, Flagler's only other property within the Tampa Bay region is the 733-acre Lakeland Corporate Park. Its other holdings are concentrated in South Florida, Orlando and Jacksonville.