A total of 115,899 square feet of ground-floor retail and office space in Grand Central at Kennedy, in the fast-growing north end of Tampaâ€™s Channel District, has sold for a record-breaking price of $38.1 million.
The buyer is Mosaic Grand Central Owner LLC, an affiliate of Mosaic Realty Partners, a private real estate investment firm based out of Maryland. The $38.1 million purchase is the largest retail transaction in Tampaâ€™s urban core in terms of sale price.
This also represents the largest retail disposition in Tampaâ€™s urban core since 2014, when Jeff Vinik purchased the 225,000 square feet that was previously Channelside Bay Plaza before being converted into whatâ€™s now Sparkman Wharf.
Grand Central at Kennedy is a high-profile urban mixed-use development that features retail, office and residential condominiums. In addition to the ground-floor retail and office space, the transaction also included a transfer of interest in the parking garage management.
Mike Milano, CCIM, Nicholas Coccodrilli and Brandon Rapone, CCIM, with Colliersâ€™ West Florida Retail Investment Team represented the seller, Mercury Advisors, the original developer of the project. Donald Jennewein and Nathan Lynch with Colliersâ€™ Debt & Equity Finance Team in Tampa arranged the acquisition financing on behalf of the buyer.
â€œThis was a rare opportunity for a buyer to acquire a trophy retail asset that is part of a premier mixed-use development in the Tampa urban core,â€ said Mike Milano, Executive Managing Director, Retail Investment Services, Colliers. â€œGiven the lack of available land in the Channel District, itâ€™s unlikely that a project of this scale, with a similar level of functionality and synergy between residential, office and retail, can be replicated.â€
At the time of the sale, the property was 100% occupied by 15 tenants. Of the listed property, 60,329 square feet is retail space and 55,570 square feet is office space. Parking management included in the transaction involves usage of 862 parking spaces for retail and office users and their visitors, divided over two garages.
Four major tenants – retailers CVS Pharmacy and Crunch Fitness, and office users Kraft Heinz Foods and Quality Carriers (a division of CSX Corporation) – occupy 80% of the gross leasable space. Other tenants include bars and restaurants Cena, City Dog Cantina, Pour House and Maloneyâ€™s Irish Pub, as well as a Massage Envy franchise. It also features a newly renovated decentralized outdoor courtyard.
The Channel District has seen impressive growth in the past couple of years, with the introduction of new apartment buildings, bars and restaurants, necessity retailers and increased office activity. The area has matured into a vibrant live-work-play environment.
Originally developed in 2007, Grand Central at Kennedy was the Channel Districtâ€™s first mixed-use project. Today, there are 1,650 multifamily units in the immediate vicinity, including luxury apartments Channel Club, The Fitzgerald and The Slade, as well as Grand Central at Kennedyâ€™s 392 condominiums. Development of an additional 675 multifamily units is currently underway within a tenth of a mile of the property.
â€œAs in-migration within the Tampa Bay area continues to increase, the urban core maintains its stature as the optimal location for retail and multifamily developers to flourish,â€ Nicholas Coccodrilli, Senior Investment Analysis Manager. â€œFor multifamily, average occupancies are pushing north of 95% and per-square-foot rents are breaching $4. The demand for pedestrian retail increases with each new resident, positioning Grand Central and all real estate investments within the Channel District for extensive growth in value.â€
Since it was established in 2012, buyer Mosaic Realty Partners has acquired 2.7 million square feet of commercial property with an investment value in excess of $320 million. With approximately a dozen investment properties in the Mid-Atlantic region, this is the firmâ€™s first purchase of a property in Florida.
The property, at 1120 and 1208 E Kennedy Boulevard, is located a half-mile from both the Water Street development and the future Gas Worx development.
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