Former outlet mall sells for $27.5M

TAMPA — An affiliate of investment firm B&L Investments LLC purchased the 344,896-square-foot Interstate Corporate Center for $27.5 million.

The price equated to $80 per square foot. That figure is less than the two-year average price per square foot for office space ($118) in the Tampa Bay area, according to the CoStar Group.

Located on a 30.7-acre site on Dr. Martin Luther King Jr. Boulevard near the Interstate 4, the single-story, 30-year-old building is a converted former outlet mall with four building wings. It was 80% occupied at the time of the sale. The building's tenants include Stream International Inc. and the state of Florida.

The seller, an affiliate of Rialto Capital of Miami, took ownership of the building in April through a quit-claim deed. The building last sold for $17.25 million to Alliance Commercial Partners LLC in February 2012.

“The condition is excellent. The previous owner made a number of improvements to the property,” says Brad Luger, a B&L Investments partner. “The location obviously was key as well. There was some vacant space so there's a little value-add in leasing it up. But most importantly we were able to get a very attractive yield on our investment.”

The purchase price equated to a payoff ratio based on income (capitalization rate) of about 12%.

The new ownership has retained Taylor & Mathis to handle the building's marketing and leasing.

Tampa-based B&L Investments LLC primarily targets neighborhood shopping centers in Tampa MSA.

The purchase entity, B&L Investments Interstate LLC, mortgaged the property to ING Life Insurance and Annuity Co. for $17.25 million.