Midtown Centre Office Park, the original Koger Center off Beach Boulevard, is listed for sale and while there’s no asking price, an industry newsletter said it could bring $65 million.
The property last sold in 2004 for $31 million and for $38.5 million in 1999, according to Duval County property records.
Lou Nutter, senior vice president of investment properties with CBRE Inc., represents the owner and said it is the third time CBRE has handled a transaction of the property.
The property holds historic significance. It was one of the original office parks developed by the late Ira Koger, who died 10 years ago at the age of 91.
Koger was considered the pioneer of the nation’s suburban office parks and began building what is now Midtown Centre in 1957. Development continued into the late 1980s.
Midtown Centre encompasses 31 mostly low-rise buildings totaling 738,530 square feet of space, according to Nutter and the Real Estate Alert trade newsletter.
Nutter said Midtown Centre was 65 percent occupied. “It has potential for a good investment upside,” he said.
The Real Estate Alert newsletter explained that with an average occupancy it reported at 67 percent, that rate left “plenty of room for an investor to boost income by leasing up the vacant space.”
It described the owner as an individual investor outside the U.S.
Property records show that owner Midtown Centre LLC is based in Coral Gables and managed by Jose Dubon.
The MidTownCentre.com website explains the property is owned by D Group Equities and that D Group Management NA oversees D Group’s real estate operations in the continental United States.
D Group Equities Management Service is based in San Juan, Puerto Rico. D Group Management, led by Dubon, is in Coral Gables.
Real Estate Alert said the complex is being offered as a package deal.
“However, because one-third of the buildings are fully occupied, a likely play for a buyer would be to flip those to recoup some of its investment, then focus on filling vacant space and upgrading the tenant roster for the remaining buildings,” it said.
Nutter said CBRE has had the listing about three weeks. The sale advisers are Nutter and CBRE Senior Vice President Michael Harrell along with Executive Vice President Ronald Rogg and associate Chip Wooten in the Orlando office.
Nutter said the owner also is selling a property in Orlando.
Midtown Center takes up 49 acres along Boulevard Center Drive, just off Beach Boulevard not far from the St. Nicholas area and about 4 miles from Downtown.
CBRE says the master-planned office park has no debt. It is expected to sell below its replacement cost, which is estimated at $173 a square foot, or $127.8 million.
Real Estate Alert said the marketing campaign emphasizes the stability of the existing rent roll, including that nearly half of the tenants are federal, state or local government agencies.
The average remaining lease term is 3.5 years. Tenants that lease more than 10,000 square feet of space, which account for a total of 200,000 square feet, have an average remaining lease term of 4.2 years.
Midtowncentre.com describes D Group Equities as a diversified family held group of partnerships and corporations with a concentration in the real estate and financial services sectors.
It says the group has more than 60 years of experience with a corporate investment philosophy to develop, build, maintain and operate its assets for long-term capital growth.
The Florida Times-Union reported in July 1999 that the complex was generally considered the first suburban office park in the nation.
Koger conceived the office park idea in the 1950s, saying that businesses would prefer offices in the suburbs with easy access to highways and ample ground-level parking. It worked so well at the Beach Boulevard center that Koger began building similar office parks in other cities in the 1960s, the story said. It also built what is now the seven-building Prominence office park owned by Crocker Partners in Baymeadows.
The story said that Koger Properties eventually developed nearly 350 buildings in 36 office parks across the Southeast before the company collapsed under a heavy debt load and filed for Chapter 11 protection in 1991. In 1993, the company was merged into Koger Equity, which sold the Beach Boulevard property to Lennar Partners Inc. of Miami. Lennar sold to Midtown Centre LLC in 2004.
State corporate records show Midtown Centre LLC formerly was led by Roger Kellogg but was converted to Dubon’s management in 2008.