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CASTO WILL PARTNER WITH JP MORGAN
SARASOTA -- Casto Lifestyle Properties, developer of the One Hundred Central condo tower downtown and the Main Street at Lakewood Ranch, has formed a joint venture with a subsidiary of investment conglomerate JP Morgan Chase & Co.
Besides increased stature, Casto's deal with New York-based JP Morgan Asset Management will give the local development firm access to hundreds of millions of dollars to acquire and construct mixed-use centers in Florida and throughout the country.
As part of the joint venture, JP Morgan has acquired a 50 percent stake in five Casto properties in downtown Sarasota and St. Armands Circle, Lakewood Ranch, Lakeland and Winter Park.
Collectively, the properties contain about 1.4 million square feet and have an estimated market value of more than $300 million.
"Our vision and philosophy is consistent with one another, and the chemistry between us is really good," said Brett Hutchens, Casto's president and chief executive, of the JP Morgan relationship. "It puts us on a solid financial structure going forward."
As part of the arrangement, the deal with JP Morgan also allowed Casto to retire roughly $60 million in debt on various properties, which will in turn boost cash flow in the future.
Although no formal agreement has been reached, it is expected JP Morgan will provide capital for planned Casto projects in Florida, North Carolina and South Carolina.
"Casto's strong reputation and proven track record will expand our access to some of the most dynamic markets in the country for mixed-use lifestyle investment," said Hilary Span, a JP Morgan Asset Management vice president, in a statement.
Among the Florida projects that JP Morgan Asset Management -- with nearly $900 billion in assets under management -- could have a role in is Sarasota Bayside, the former Sarasota Quay.
There, a Dublin, Ireland-based investment group is planning a $1 billion mix of residences, hotel rooms, retail and office space.
Casto is Bayside developer Irish American Management Services Ltd.'s retail partner. The company is hoping to lure upscale tenants such as Ralph Lauren and Gucci to the 15-acre, waterfront development.
In all, Casto intends to develop 16 mixed-use lifestyle projects through 2013, Hutchens said.
Hutchens was introduced to JP Morgan executives last year, when Casto's Ohio-based sister company sold the firm a Cincinnati shopping center. Talks regarding a possible joint venture began earlier this year.
"They bring an almost unlimited source of capital to the table, and their turnaround time for strategic decisions is typically only a few days," Hutchens said. "That's what really impressed us."
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