If creativity is not one of the first words that comes to mind when describing a commercial realtor, it should be. At Coldwell Banker Commercial SunCoast, creativity is a highly valued attribute among our agents. Why? Because creative problem-solving can quickly turn a difficult deal into a success story.
One deal that particularly exemplifies this creative approach is Racine Business Court, an office condominium complex on three acres on Racine Drive in Wilmington, N.C. The property is an ideal, central location just minutes from I-40, downtown Wilmington, Mayfaire and Wrightsville Beach.
The development team, comprised of Legend Builders and a partner of CBC SunCoast, was originally planning to develop one large, 30,000 square-foot building on the site, but were soon approached by an investor who wanted a 15,000 square-foot, stand-alone building. They wanted to accommodate the buyer’s request, because it would give the developers funds to offset overall construction costs. But if the property was divided to accommodate the buyer, subdivision regulations and setbacks would restrict the size of the remaining developable property and severely restrict its profitability.
The partner engaged a local real estate attorney, and together they reviewed the general statutes of condominium development and found the rarely used and little-known statute 47-C regarding “condominium of land.” By treating the three-acre tract as a condominium of land with its own master association, they were exempt from subdivision regulations, and were free to build three stand-alone buildings: two at 12,000 square feet and one at 15,000. Instead of one 30,000 square-foot high rise, they created three two-story office buildings that offered 9,000 additional square feet and a design and scale much more appropriate to the neighborhood. The land configuration also enabled them to offer buyers an enviable parking ratio of five spaces per 1,000 square feet (typical office ratios are three to four spaces per 1,000).
The developers also got creative with the site’s stormwater system. Instead of the typical retention pond, they installed an underground Cultec infiltration system of half pipes laid side-by-side. Although a revolutionary approach at the time, the Cultec system was a great success. Today, Cultec is widely used.
Instead of sticking to their original idea for the property, the developers were creative in exploring solutions and their efforts paid off. By condo-ing the land, CBC SunCoast and Legend Builders were able to maximize the site’s developable land and increase its profitability. The buildings were built one at a time and CBC SunCoast pre-sold the majority of the office condos for $170 to $200 per square foot.
The condo strategy also saved them considerable time. Instead of the 90-day approval process typically associated with a subdivision (in which you submit plans to the planning board and then city council), a condo requires a single review before the city’s Technical Review Committee, a 45-day approval process.
There are many more opportunities to use this “condominium of land” approach for commercial properties. And although some developers are reluctant to take a creative approach, this project demonstrates that taking the “road less travelled” can have many benefits.
Grayson Powell is a Managing Partner at Coldwell Banker Commercial SunCoast. CBCSC leverages the vast experience of highly skilled real estate professionals and developers and specialize in selling, leasing and managing retail, commercial, and investment property. To learn more about CBCSC, visit www.cbcwilmington.com or call (910) 350-1200.
Cece Nunn - Nov 11, 2019
The area’s two accountable care organizations measured high on quality marks last year, and one qualified for a sizeable return in shared sa...
There has been a subtle shifting of market share within the 21 banks that maintain a presence in the Wilmington area of Brunswick, New Hanov...
Brokers’ thoughts on the matter run the gamut, from great to so-so to preparing for challenges ahead....