A joint venture between Feldman Equities, Tower Realty Partners and Equity Street acquired a marquee property in downtown Sarasota.
The joint venture bought Sarasota City Center, two Class A office buildings at 1819 Main St. The buildings total 247,947 square feet and are connected by a common atrium.
The purchase price was not disclosed in a news release announcing the deal, but the joint venture said it plans to spend about $10 million in capital and tenant improvements to upgrade the building.
Feldman Equities, which specializes in turning around distressed office assets, already is a major property owner in downtown St. Petersburg and downtown Tampa.
“We’ve had our eye on the Sarasota market for years now and we’re thrilled to grow our greater Tampa Bay footprint to one of the fastest growing counties in the country. Downtown Sarasota is hot right now,” said Larry Feldman, CEO. “Still, we managed to acquire these buildings at less than half of replacement cost and we don’t expect any new supply to come online in downtown Sarasota for at least four or five years.”
A healthy economy in Sarasota played a key role in the deal. Thousands of new apartments units and luxury condominiums are under construction in downtown Sarasota, and the city includes some of the wealthiest zip codes in Florida, according to the news release. Employment grew by 2.6 percent over the past year, far outpacing the national average.
Sarasota City Center last sold in 2017 for $36.5 million, property records show. The owner, The Dilwig Cos., a Durham, North Carolina-based investment firm, put the buildings on the market in October 2019, asking about $50 million, according to the Sarasota Herald-Tribune.
The building currently is about 80 percent occupied. Vacant suites will be upgraded, with some pre-fitted with offices and reception areas for tenants that want to move in right away. Other planned improvements modernized common corridors, an energy-efficient chiller, and main lobby enhancements.
“Sarasota City Center is already the best building in downtown Sarasota. Our goal is to bring the building up in quality to a Class A+ condition,” Feldman said.
JLL marketed the property on behalf of the seller, and worked with the Feldman-Tower-Equity Street joint venture to obtain get a loan from NXT Capital. Loan proceeds funded the acquisition and will be used to upgrade the building, the news release said.
Sarasota City Center expands Feldman Equities’ portfolio, which already includes three Class A downtown St. Petersburg office buildings — First Central Tower at 360 Central Ave., Morgan Stanley Tower at 150 2nd Ave. N., and City Center at 100 2nd Ave. S. Feldman last year bought Castille at Carillon, two Class A office buildings in Carillon Office Park. The company also has properties in downtown Tampa — Park Tower, Wells Fargo Center and Riverwalk Place.