TerraCap Partners II buys land for 'multifamily opportunity'

BUYER: Sun Center Village LLC (principal: Walter S. Hagenbuckle), Bonita Springs
SELLER: Sarasota Family YMCA Inc.
PROPERTY: 41 N. School Ave., Sarasota
PRICE: $1.44 million
PREVIOUS PRICE: $232,779, December 1992

PLANS, DESCRIPTION:
The investment fund TerraCap Partners II purchased three Sarasota YMCA buildings on 1.3 acres fronting Fruitville Road for $1.44 million. The price equated to $25 per square foot of land.

The three buildings were unoccupied and in bad condition. Overall the buildings themselves had little to no value, according to John Harshman of Harshman & Co. Inc., who represented the seller. The value was in the property, which is zoned downtown core, allowing a development of up 50 units per acre and up to 10 stores.

The property is adjacent to the parking lot for Kane Plaza, which TerraCap Partners II purchased from Y Associates Ltd. earlier this year for $11.5 million. W. Stephen Hagenbuckle, founder and co-managing partner of TerraCap Partners, says the additional property combined with the parking lot gives the group nearly two acres.

“That parking lot wasn't significant enough size wise for us to do a meaningful project there,” says Hagenbuckle, “That's when this other piece became available. I think it's ideal for a multifamily opportunity there. Multiple parties have expressed interest already in a joint venture or in acquiring it from us.”

A condominium development is more likely on the site than an apartment project, Harshman says, because of the construction costs associated with building heights above five levels.

“This is a very significant transaction east of [U.S.] 301,” Harshman says. “[The buyer] is recognizing this as a kind of diamond in the rough. There hasn't been much development east of 301 except for a few office buildings and a jail. Hopefully this is just the beginning of quality development there.”