The fifth fastest growing company in the nation bought new office property on the Gulf Coast for a steal.
The fastest growing company in Sarasota has a new trophy: An office headquarters more than three times larger than its current space.
Not only that, but the company, online marketing firm IntegraClick, bought the two-building, 79,000-square-foot complex on 12 acres at the bargain price of $5.75 million, roughly $72 a square foot — a cost that surely reflects the slumping market. The $5.75 million price also includes space for IntegraClick to build a third building on the site.
Several local commercial real estate brokers tell Coffee Talk that the complex, at the corner of Honore Avenue and University Parkway, about a mile west of Interstate 75, could have gone for $150 or even $160 a square foot during the boom. IntegraClick bought the complex, University Professional Park, from Burton-Katzman, a Michigan based commercial real estate development and property management firm with a large portfolio in Sarasota.
“Unfortunately, the market isn't what it was a few years ago,” says Conrad Schewe, vice president of project development with Burton-Katzman. “The price reflected that.”
Some commercial real estate brokers speculated that the property, built in 2007, was labeled distressed by banks and lenders working with Burton-Katzman, which forced a sale at the low price. Schewe declined to comment on that speculation, saying only that the firm sold the property after deciding it couldn't lease space there at numbers that worked.
Regardless, the folks at IntegraClick have greater concerns than the state of the local commercial real estate market. Like moving into its new digs, for one.
“We wanted something that gives us a campus-like environment,” says Ravi Ghai, IntegraClick's head of corporate development. “We were going to outgrow our
[current] space, but I don't think we will outgrow this for a while.”
IntegraClick had been operating out of 23,000 square feet of space on the third floor of an office building near Fruitville Road and Interstate 75 for a few years. The company was initially run out of founder John Lemp's Sarasota apartment.
The company's revenues have grown even faster than its space needs.
In fact, IntegraClick has grown revenues more than 12,000% since 2005, from $755,000 to $96.4 million in 2008. The company, which had 100 employees at the end of 2009, was ranked the fifth-fastest growing firm in the country by Inc. magazine last year. (See 9/24/09 Review.)
The company says it had been lured to leave Sarasota by other cities, including Miami and Tampa. But Lemp says he wanted to build on the work he already started in town — much to the relief of local economic development officials.
IntegraClick plans to finance parts of the purchase using tax-exempt bonds administered by Sarasota County through a federal stimulus program.
The company hopes to move into the new space by the springtime, says Ghai. And for that task, the company has added a new wrinkle: It's seeking the help of the business community to design the workflow and the new office. New ideas may be submitted directly on the company's blog at http://blog.clickbooth.com.
— Mark Gordon