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Business Observer Thursday, Oct. 20, 2005 13 years ago

Real Estate Briefs (Tampa)

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St. Petersburg office deal exceeds $80 millionStella del Mar residents acquire mobile home parkConfectioner buys Clearwater Beach motel
by: Article Author Staff Writer

Real Estate Briefs (Tampa)

St. Petersburg office deal exceeds $80 million

Over the years, the Koger Executive Center became a popular operating site for businesses that prize its central location to Clearwater, St. Petersburg and Tampa. About 117 businesses, such as Verizon Information Services and National Flood Services, lease space in the 15-building corporate park in St. Petersburg's Gateway area.

When their leases come up for renewal, however, these businesses will be dealing with a new landlord. New York's DRA Advisors LLC recently acquired the office park as part of $1.8 billion deal with CRT Properties Inc.

Once it closed the deal, the New York investment management firm sold a 15% interest in this portfolio of 11.7 million square feet of office space to Colonial Properties Trust, a Birmingham, Ala. publicly traded real estate investment trust (REIT).

The acquisition includes most of the office properties CRT Properties, a Boca Raton-based publicly traded REIT, acquired several years ago in a merger with Koger Equity Inc.

Of the 26 office parks purchased, DRA Advisors gained control over 671,398 square feet of office space in the St. Petersburg office park. It's an office park that reports occupancy rates of about 90% and average asking rents of $16.57 a square foot. The seller maintained nearly $26 million in debt on the property as of the fiscal year ended Dec. 31.

Those figures may account partly why a DRA Advisors operating entity declared a mortgage value of $79.8 million on the St. Petersburg office buildings. That's the amount DRA CRT St. Petersburg Center LLC disclosed in a mortgage and security agreement signed Sept. 27 and recorded Oct 10 in Pinellas County.

From a practical standpoint, the DRA Advisors operating entity probably paid much more than $79.8 million for the St. Petersburg properties.

Assuming a typically 75% loan-to-value ratio for commercial properties, for instance, the New York investment firm would have paid as much as $106 million or $158 a square foot.

It's uncertain whether the operating entity negotiated a higher loan-to-value ratio through Wachovia Bank NA, the lender. Officials at Colonial Properties, which now manages the portfolio, did not respond to a request for comment.

The ownership interest in the CRT portfolio only slightly increased Colonial Properties investment in the Tampa Bay area, public records show. Prior to the DRA Advisors deal, the company owned only 292,200 square feet of office space in Tampa's Concourse Center.

Most of Colonial Properties' investments locally are in the multifamily sector. It owns nearly 1,100 apartment units in the Tampa area with about 991,443 net rentable square feet. In the Sarasota-Bradenton market, it owns nearly 1,300 apartments units with about 1.3 million net rentable square feet.

Stella del Mar residents

acquire mobile home park

BUYER: Stella del Mar Co-Op Inc., Largo

SELLER: Stella del Mar LLC, Akron, Ohio

PROPERTY: 12100 Seminole Blvd., Largo

PRICE: $26,350,000

PRIOR SALE: $16,200,000, April 2003

LAW FIRM ON DEED: Ruden McClosky Smith Schuster & Russell PA, St. Petersburg

PLANS, DESCRIPTION: Threatened with the possibility of eviction, a group of residents has acquired Largo's Stella del Mar mobile home park.

Stella del Mar Co-Op Inc., a nonprofit group the residents formed, paid nearly $26.4 million earlier this month for the 54-unit site and 402 lots at 12100 Seminole Blvd. That's nearly 63% more than $16.2 million the seller paid in April 2003 for the property.

Residents organized the buyout when an unidentified California condominium developer offered the owner, Sella del Mar LLC, $26 million for the property, says Richard Foos, the co-op's president. State law grants mobile home park residents the opportunity to match buyout bids.

To present an effective counteroffer, Foos says, the residents hired a Treasure Island company that offers buyout consulting services to mobile home residents. Besides consulting services, Florida Community Services Group Inc. also assists residents with financing.

In this instance, the residents obtained $19 million in financing through BankAtlantic. About 180 residents each paid $49,000 to secure the financing.

Anyone who wants to live in the mobile home park now must buy a share in the co-op, says Foos, a retired electrical engineer. Shares for a lot there now sell for around $65,000.

Confectioner buys Clearwater Beach motel

BUYER: Enchantment LLC, Clearwater

SELLER: Seawake Motel Ltd., Clearwater

PROPERTY: 691 S. Gulfview Blvd., Clearwater

PRICE: $25,000,000

PRIOR SALE: Unavailable

LAW FIRM ON DEED: Johnson Pope Bokor Ruppel & Burns LLP, Clearwater

PLANS, DESCRIPTION: For months Uday Lele has worked with Clearwater planning officials on a proposal for a beachfront condominium project. It's apparent the India-born entrepreneur feels confident about the project's outcome. He just purchased the redevelopment site.

Lele's Enchantment LLC, a holding of Enchantment Management Co LLC, paid $25 million earlier this month for the Best Western Sea Wake Beach motel, 691 S. Gulfview Blvd. That's nearly $440 a square foot for the 6-story, 110-unit hotel. The building, constructed in 1973, contains about 57,000 square feet.

Over the years, Lele established himself as a confectioner. His Dayhoff Inc. produces a candy known as Juicee Gummee.

Lele's company purchased the motel from Seawake Motel Ltd., a holding of Clearwater's Seven Seas Equities Inc. Don Seaton, Seven Seas president and CEO, is a second-generation hotelier who has served as chairman of Best Western International Inc. He is a former Florida Hotelier of the Year.

To finance the acquisition, Lele's company secured a $20 million mortgage through New York's Intervest National Bank.

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