We recently completed the buildout construction for new tenants to occupy space in their Chipola River property located in Marianna, Florida.  We subdivided 13,250 and 3,800 square feet of space for tenants, totaling 17,050 square feet of newly built-out space out of 93,600 total.

It was acquired from Sallie Mae, the student loan company, who used it for a 900 seat call center for several years before consolidating its regional operations and vacating this building.  Their state of the art equipment remains in the building in excellent condition.  We are presently negotiating with another call center operator in Washington, D.C. interested in relocating their operations.  They need fifty to seventy thousand square feet of space, which would nearly fill out the project and the buildout cost would be minimal. 

The new call center would bring over 375 new jobs to the area, so the locals are hoping the lease will be negotiated successfully.  Businesses relocating to Jackson County can take advantage of the State of Florida and U.S. Government’s incentive programs offering huge tax incentives for job creation.  The combined tax incentives run over $3.85 million for the new call center.  It’s an attractive benefit for a relocating business and we are expecting it will help tip the scales in our favor.

The purchase price was $1,850,000, which is $19.76 per square foot. It would cost about $110 per SF to rebuild, plus the land valued at $175,000 per acre.  To break even, we only need to lease 35,000 SF out of a total of 93,600, or about 37% occupancy.  Because it was purchased so cheaply, no other landlords in the area can compete with our rental rates and still make money.

Also, the market cycle entry timing greatly reduced the risk, so we felt comfortable closing the deal. Once the property is fully leased, we intend to sell or refinance, depending on the current economic conditions at that time. Either way, our investors are expecting a great return on their investment.  There is still room in this deal, so call if you’re interested.

     For more information visit Grace Realty Group’s website at http://www.gracerealtygroup.com.