New York REIT snaps up newly built, vacant warehouse in Plant City
The warehouse sold to New York-based Lexington Realty Trust.

By Ashley Gurbal Kritzer
Tampa Bay Business Journal
Published: Jun 23, 2021

A speculative Plant City warehouse attracted a new owner before landing its first tenant.

The 510,000-square-foot warehouse at 3775 South County Line Road has sold to New York-based Lexington Realty Trust for $48.5 million, according to Hillsborough County property records.

The seller, Wharton Industrial Trust, bought the 34-acre site where the warehouse stands in 2014 and partnered with Red Rock Developments on the project. Construction began speculatively, without a tenant in place.

"The second I saw the site, I knew it was spectacular," Peter Lewis, Wharton Industrial chairman, told the Tampa Bay Business Journal.

It's unusual for a speculative development to sell before landing a tenant. But industrial real estate in Florida, particularly along the Interstate 4 corridor, is as hot as it's ever been. Prologis recently sold an Amazon-occupied warehouse in Davenport for $170 million; another Amazon facility in Lakeland sold for $108 million. Both sales were more than $150 per square foot, which is top of market pricing for industrial properties in Central Florida.

Wharton's Plant City warehouse sold for $95 per square foot — which, for a vacant building, beat the sellers' expectations.

"The price matched the underwriting assuming the building was fully leased at the sale," Lewis said.

It's not the first time Wharton and Red Rock have seen a big bet on the Florida industrial market pay off: The investors were also behind a speculative warehouse in Ocala that landed Amazon as a tenant and sold, also to Lexington Realty Trust, for $58.4 million in 2020.

And they're not done yet: Lewis said his firm is "aggressively looking" for more development sites and is considering a cold storage development. Interest in cold storage properties — temperature-controlled warehouses that attract food and pharmaceutical companies — exploded during the novel coronavirus pandemic as consumers turned to online food shopping.

Those warehouses are much more expensive to build than their dry storage counterparts and they're rarely built speculatively. But with interest in the properties soaring, and vacancy rates at historic lows, more developers are willing to consider it.

"The whole market is really fascinating," Lewis said.