The airplane was substantially damaged when it impacted the ground in an industrial area shortly after takeoff. The accident occurred at about 1505 Eastern time, shortly after takeoff. Day visual conditions prevailed. The flight instructor (CFI) and student pilot/owner suffered serious injuries. According to the CFI, at approximately 400 feet above ground level, the engine began to “sputter.” He took control of the airplane and aimed the airplane towards an opening. Approximately 10 seconds after the degradation of power, the airplane “hit hard, skidded, hit hard again, came to a stop, and the cockpit was immediately engulfed in flames.” The airplane impacted several trees, left several gouge and scrape marks in the adjacent parking lot and came to rest against an office building.