100 S. Washington Blvd. • Sarasota, FL 34236 • 941.957.3730 • msccommercial.com

The tri-county area commercial market posted strong market fundamentals throughout the third quarter of 2018 for all

property types. Looking back at the quarter, the largest commercial sales in the market involved multi-family properties and vacant land. One notable sale was the purchase of a pair of manufactured home communities in Sarasota County for $165 million by Cove Communities of Phoenix, an Arizona real estate investment

company. The communities, Camelot Lakes Village and Camelot East Village, are both geared toward 55+ residents with resort-style amenities that encourage active lifestyles. As we move into the final quarter of 2018, the continued expansion of the area driven by steady population growth will see an influx of new hotels, retail stores and condominiums. Read on for more of the latest in the region’s commercial real estate market.

State of the Market Manatee, Charlotte & Sarasota Counties

COMMUNITIES REPRESENTED AS OF SUMMER 2O18

COMMUNITY PRICE # OF RESIDENCES CONSTRUCTION INFO

THE RITZ-CARLTON RESIDENCES, SARASOTA From $2,400,000s 73 Under Construction, Preview Gallery Open

MARK SARASOTA From the $800,000s 157 Under Construction, Sales Gallery Open.

PALMA SOLA BAY CLUB From the $300,000s 207 Sales Gallery Open

SANDHILL LAKE From the $500,000s 43 Models Open

RIVERSIDE POINT From the $400,000s 37 Models Open

SANDHILL LAKE From the $400,000s 43 Model Preview Center Open

3rd Quarter 2018

MS&C Commercial works closely with clients to secure the right location and land for exceptional new developments. MS&C New Homes & Condominiums takes over from there, putting to work dynamic strategies that bring these exciting communities to the market.

SIGNIFICANT TRANSACTIONS MS&C Commercial • Q3 2018Date Location Sale/Lease SQ FT or Acreage Property Type

7.2.18 720 Commerce Drive, Units #104-105, Venice LEASE 7,560 SF Office

7.10.18 10920 Moss Park Drive, Orlando SALE 27,500 SF Medical Office

7.26.18 302 Manatee Avenue West, units #100-105, Bradenton LEASE 11,499 SF Office

8.2.18 302 Manatee Avenue East, Bradenton SALE 45,228 SF Office

8.9.18 4413 S. Tamiami Trail, Sarasota LEASE 3,400 SF Retail

8.10.18 7522 S. Tamiami Trail, Sarasota LEASE 14,670 SF Retail

9.11.18 1508 Main Street, Sarasota LEASE 2,160 SF Retail

9.17.18 4811 Fruitville Road, Sarasota SALE 8.20 +/- Acres Land

9.18.18 2225 Industrial Blvd. Unit B, Sarasota LEASE 4,500 SF Industrial

9.26.18 6408 Parkland Drive Unit #103, Sarasota LEASE 4,735 SF Industrial

COMMERCIAL TRENDS & REPORTS

OverviewLeasing: The average office rental rate continued to rise and inventory continues to be tight. Marketing solutions provider, RSP USA, recently broke ground on its new $3 million Manatee County headquarters. The building, at 5110 Lena Road in Bradenton, is expected to be finished in spring 2019 and will give the company 23,437 square feet of space. The project will increase RSP USA’s current footprint and accommodate a growing client base.

Sales: Office sales activity primarily occurred in the suburban submarkets this quarter. Lawrence Capital, a real estate capital and advisory firm founded by attorney Richard Lawrence, recently acquired the Lake Osprey Building (36,945 sf) in Lakewood Ranch from Schroder Manatee-Ranch for $7.4 million ($230.30/PSF). The office building has both regional and national tenants, including medical, technology, banking, financial, and education-based institutions.

6.7% DOWN

▼OVERALL VACANCY RATE

2.0% ▲ UP

OVERALL VACANCY RATE

37,152 SF ▲ UP

YTD NET ABSORPTION

251,524 SF DOWN

▼YTD NET ABSORPTION

$19.88 PSF ▲ UP

AVERAGE ASKING RENT (GROSS)

$7.48 ▲ UP

AVERAGE ASKING RENT (NNN)

OverviewLeasing: With the low vacancy rates, Benderson Development & Harrod Properties are currently building additional industrial space in the tri-county area. The new inventory will provide new modern spaces with amenities, adequate truck and other vehicle parking and higher ceilings. Defender Screens International LLC, dba Progressive Screens recently expanded and signed a 30,000-square foot lease at 5330 Pinkney Ave, Building D, in Sarasota. Progressive Screens is expected to move in by October 1.

Sales: 99 Center Rd (39,204 sf) in Venice sold during the third quarter for $2.4 million ($61.12/PSF). The buyer, Gregory Douglas, owner of Douglas Jeep, Inc. in Venice, FL, purchased the industrial manufacturing building to store excess vehicles. The car dealership is located across the road from the property.

IndustrialArrows indicate change from previous year.

Arrows indicate change from previous year.

Office

All Office Classes2013 $17.41

$17.45$17.53$17.71

2014 $17.74$17.90$17.70$17.96

2015 $18.38$18.42$18.34$19.02

2016 $19.02$19.02$19.06$19.37

2017 $19.20$19.09$19.10$19.63

2018 $19.47$19.72$19.88

OVERALL ASKING RENT, $ PSF (Gross)

$17

$17.5

$18

$18.5

$19

$19.5

$20

2013 2014 2015 2016 2017 2018

1

Overall Vacancy Rate2013 9.2%

7.7%8.0%8.0%

2014 7.3%6.9%6.0%6.0%

2015 5.5%5.0%5.0%4.4%

2016 4.0%3.7%3.1%2.6%

2017 2.3%1.8%1.9%2.0%

2018 2.0%2.3%2.0%

4.6% 5-Year Average

OVERALL VACANCY RATE

0%

10%

2013 2014 2015 2016 2017 2018

5-Year Average = 4.6%

1

Land Multi-FamilyNational homebuilders and residential developers continued to purchase vacant land in the tri-county area during the third quarter. Taylor Morrison bought roughly 200 acres for $10.53 million from the City of Bradenton for a community of 350 single-family homes and villas in Manatee County. Kolter Group bought 249 acres for $12.57 million from Schroeder-Manatee Ranch for a 651-home development in Lakewood Ranch.

The year to date median price per square foot/acre of sold parcels for Commercial, Industrial and Residential zoned land are below:

Commercial Land: $4.27 Per Land SF / $185,841 Per Acre

Industrial Land: $4.67 Per Land SF / $203,488 Per Acre

Residential Land:$1.73 Per Land SF / $75,394 Per Acre

The demand for high-quality, multi-family housing will continue to grow as Sarasota shows strong demographics in the urban and suburban submarkets. Rising rents have attracted multi-family investors from around the country and the multi-family market continues to be in the midst of a supply boom. Katz Properties recently acquired The Point at Bella Grove in Sarasota for $38.0 million ($211,111 per Unit) in July from Waypoint Residential. The 180-unit apartment community was developed in 2017.

Occupancy Rate: 93.4%

YTD Net Absorption: 560 Units

Average Effective Rent Per Unit:$1,222

5.4% DOWN

▼OVERALL VACANCY RATE

162,958 SF ▲ UP

YTD NET ABSORPTION

$14.11 ▲ UP

AVERAGE ASKING RENT (NNN)

OverviewThe tri-county retail market finished the third quarter of the year on solid fundamentals with vacancy rates falling across the region. The retail market continued to see an influx of innovative franchises and expansions. The total vacancy rate ended the third quarter at 5.4%, which has been one of the lowest rates since 2007. The average asking rental rate (NNN) ended the third quarter at $14.11/ PSF, which has been one of the highest rental rates since early 2010.

Retail Announcements/Openings: Detwiler’s Farm Market opened their new 50,000+ square feet store in Palmetto during the quarter. The Palmetto store is the largest of all their stores and will employ more than 100 people. In downtown Sarasota news, Grand Cru Wine Bar, a self-serve wine and beer bar, recently opened and Sara Campbell, a national women’s apparel company, announced that it will be opening a new store on Main Street next quarter.

RetailArrows indicate change from previous year.

Grand opening for Detweiler’s in Palmetto, FL.

COMMERCIAL TEAM

Michael Saunders, CEO & Founder, Michael Saunders & Company

Matt Drews, Director

Benjamin Bakker

Gail Bowden

Michael Curtin

Dennis Dahm

Lee De Lieto, Sr., MBA

Lee De Lieto, Jr., P.A., Broker-Associate

Michael Gallatin

Susan Goldstein, MBA, CCIM

Ben Graham

Daniela Kaskey

Roberta Kolton Cera

Steven Larkin

Gary Marshall

Will Martin

Eric Massey, Broker-Associate

Robert Moffatt

Molly O’Brien

Daniel J. Page, CCIM

Erin Reid

Howard Sadwin

Larry Schaper, CCIM

Joshua Tackett, ACP

Peggy Wellman

Ellen Spencer, Administrative Assistant

Gareth Watson, Senior Research Analyst

BRADENTON OFFICE4400 Manatee Avenue West • Bradenton, FL 34209Phone: 941.748.6300 • Fax: 941.749.5001

DOWNTOWN SARASOTA OFFICE100 S. Washington Blvd. • Sarasota, FL 34236Phone: 941.957.3730 • Fax: 941.552.5216

ENGLEWOOD OFFICE1200 S. McCall Road • Englewood, FL 34223Phone: 941.473.7750 • Fax: 941.473.7751

LAKEWOOD RANCH OFFICE8325 Lakewood Ranch Blvd. • Bradenton, FL 34202Phone: 941.907.9595 • Fax: 941.907.8802

ORLANDO121 S. Orange Ave., Suite 1500 • Orlando, FL 32801Phone: 407.377.6830

PALMER RANCH OFFICE8660 S. Tamiami Trail • Sarasota, FL 34238Phone: 941.966.8000 • Fax: 941.918.9392

PUNTA GORDA OFFICE101 Taylor Street • Punta Gorda, FL 33950Phone: 941.639.0000 • Fax: 941.639.0101

COMMERCIAL PROPERTY MANAGEMENT

1801 Main Street • Sarasota, FL 34236Phone: 941.951.6660 • Fax: 941.951.6667

Bob Smith, Director of Commercial Property Management

Diane Conte, Administration Manager

Tony Fus, In-House Facility Technician

Our wide reach and deep knowledge in all areas of commercial real estate — as well as meaningful relationships right here in the business community — leads to sales success in every space.For all your commercial real estate needs , think MS&C Commercial.

SALES x LEASING x PROPERTY MANAGEMENT x TENANT REPRESENTATION

SUCCESS IN EVERY SPACEOFFICE | INDUSTRIAL | RETAIL | MULTIFAMILY | LAND | INVESTMENT