By Richard BilbaoDigital Producer/Senior Staff Writer, Orlando Business Journal
Daytona Beach-based CTO Realty Growth Inc. (NYSE: CTO) has completed the sale of approximately 1,600 acres of land in Daytona Beach to Austin, Texas-based Timberline Real Estate Partners affiliate Timberline Acquisition Partners.
CTO, a real estate investment giant, closed the deal as part of a joint venture with Evanston, Illinois-based hedge fund Magnetar Capital on Dec. 10. The closing price for the deal was $66.3 million — or nearly $41,000 per acre, according to a news release.
The funds from the Timberline sale will go toward repaying its unsecured revolving credit facility, as well as general corporate and working capital purposes.
“We’re thrilled to be completing this final land sale, which provides us with meaningful non-income producing equity to redeploy into our core investment strategy of acquiring high-quality, multi-tenanted retail and mixed-used properties,” said John P. Albright, president and CEO of CTO Realty Growth, via a prepared statement. “As we look toward 2022, the redeployment of proceeds from this final sale will enhance our corporate credit metrics, improve our dividend coverage and drive increased organic [funds from operations] and [adjusted funds from operations] per share growth.”
Uses for the land include a logistics park, multifamily, retail and commercial, previously said Timberline CEO Stan Nix in a prepared statement. Executives with the company were not available for comment.
Big land owner
CTO said the sale ends a 111-year role it held as a significant land owner in Florida, which at one time amounted to approximately 2 million acres. The company had been selling off its remaining 11,000 acres over the past 10 years for more than $287 million combined. Those proceeds were reinvested into other company assets.
The land deal comes on the heels of an even bigger local transaction that occurred in July 2020.
That’s when Orlando-based developer Avalon Park Group/Sitex Properties USA Inc. bought 3,015 acres from CTO for about $40.9 million, or $13,565 an acre. That’s where Avalon Park Group/SitEX plans to build 10,000 residential units along with other commercial development.
New construction starts rose 10% to $889.7 billion in September, according to Hamilton, New Jersey-based Dodge Data & Analytics. Non-residential starts gained 15% to hit $281.8 billion. However, that’s not without some challenges.
“Construction starts have struggled over the last three months as concerns over rising prices, shortages of materials and scarce labor led to declines in activity,” Richard Branch, chief economist for Dodge Construction Network, said in a prepared statement.
“The increase in September, however, partially allays the fear that construction is headed for a free-fall and shows that owners and developers are still ready to move ahead with projects. Starts are likely to continue to trend in a positive but sawtooth fashion in the coming months until a more balanced recovery takes hold next year.”