Tampa Bay’s Commercial Real Estate Landscape: A Year of Challenges and Notable Sales in 2023

Tampa Bay’s Commercial Real Estate Market: A Year of Resilience Amidst National Turmoil

As 2023 draws to a close, the commercial real estate landscape in Tampa Bay reflects a year marked by both challenges and notable transactions. While many markets across the United States grappled with investor defaults and a wave of office building closures, Tampa Bay has managed to maintain a relatively stable footing, according to industry experts.

Matt Siegel, executive managing director and brokerage market leader for Collier’s West/Central Florida region, highlighted the region’s resilience. “West/Central Florida continues to see strong economic fundamentals and increased demand from in-migration,” he stated, emphasizing the area’s ongoing appeal to new residents and businesses.

Despite the overall health of the Tampa Bay market, the numbers tell a story of contraction. The top 20 commercial sales in the region totaled over $1 billion, with four properties exceeding the $100 million mark. However, this figure pales in comparison to the more than $2 billion in commercial sales recorded in 2022. The slowdown can be attributed to rising interest rates and a tightening of capital availability, leading banks to become more cautious in their lending practices.

Looking ahead, there are glimmers of hope for 2024. With inflation beginning to cool and the Federal Reserve hinting at potential interest rate reductions, there is a sense of “cautious optimism” in the air, according to Siegel.

Notable Transactions of 2023

Here’s a closer look at some of the most significant commercial real estate deals that shaped Tampa Bay’s market this year:

1. Westfield Brandon Mall – $220 million
   The largest sale of the year marked a pivotal moment as the last Westfield mall in Florida was sold to North American Development Group. This transaction signified Westfield’s strategic retreat from the U.S. market, following struggles during the pandemic.

2. Bell Lansbrook Village – $203.9 million
   North Carolina’s Bell Partners acquired this 774-unit apartment community, previously a condominium complex, from Osso Capital, showcasing the ongoing demand for multifamily housing in the region.

3. Urban Centre – $123 million
   Ally Capital Group purchased this office complex in the Westshore Business District from Starwood Capital Group, albeit at a loss, reflecting the shifting dynamics of the commercial office market.

4. Rowan Pointe – $108.6 million
   This newly constructed apartment complex in Pinellas Park was snapped up by The Praedium Group, highlighting the demand for quality rental properties in a growing population area.

5. Azora at Cypress Ranch – $96 million
   Nashville-based Carter-Haston acquired this luxury community in Lutz, further emphasizing the trend of investment in high-quality residential developments.

6. Avasa Grove West – $95 million
   Venterra Realty Management’s acquisition of this Wesley Chapel complex underscores the appeal of amenity-rich living spaces in the Tampa metropolitan area.

7. Seven Lakes at Carrollwood – $94.36 million
   Bridge Investment Group’s purchase of this sizable complex reflects the competitive nature of the multifamily market, with over 20 offers received for the property.

8. Boot Ranch Apartments – $89.61 million
   Eagle Property Capital’s acquisition of this Palm Harbor complex highlights the ongoing interest in multifamily investments in suburban areas.

9. Azalea Apartments – $85.75 million
   This under-construction Brandon project was acquired by Trilogy Real Estate Group, showcasing the potential for growth in the region’s rental market.

10. Tessa Springs – $83.75 million
    The Praedium Group also secured this newly built complex in Thonotosassa, further solidifying its investment strategy in high-demand areas.

As Tampa Bay navigates the complexities of the commercial real estate market, the region’s ability to attract investment and adapt to changing economic conditions will be crucial in the coming year. With a foundation built on strong economic fundamentals and a growing population, the outlook remains cautiously optimistic for 2024.