South Florida Office Tower Trifecta

It’s no secret that South Florida’s real estate market has gone gangbusters, but it’s not only sales of high-ticket residential dwellings that are making headlines. Big deals in commercial development abound as well. Apropos of South Florida stealing the spotlight in business migration this past year, the top three most noteworthy deals focus on office space. As noted in the financial journal CFO Dive, “employees are being beckoned by the Sunshine State’s desirable climate, pristine beaches and easy daily commute.”

As a result, “Tech companies are moving to Florida in droves thanks to this influx of talent, the state’s business first mindset and an absence of state income tax.” And, Florida Trend confirms, “Amid all the movement, demand for office space is surging.”

TOP 3 SOUTH FLORIDA OFFICE DEALS

#1 Boca Raton Innovation Campus: $320.2 million

In what is being hailed as one of South Florida’s biggest real estate investment deals of the year, real estate management firm CP Group sold the massive BRIC campus to DRA Advisors for a record $320 million. Located at 5000 T-Rex Avenue, the huge 1.7 million-square-foot complex, former home to IBM’s research center and birthplace of the first personal computer, is one of the largest office campuses in the country. The campus is so vast that it has a shuttle service with 13 stops to transport workers around the property. The sale comes on the heels of a plan to transform the BRIC into a mixed-used community consisting of 1,000 residential units, 60,000 square feet of medical office space, 166,000 square feet of retail, a 130-room hotel and a 2,100-seat civic center. CP Group estimates the construction costs at $204.7 million.

CP Group purchased the site in 2018, and has already added a fitness center and café. Currently, the BRIC is home to 35 companies including Canon, Verizon, and Boca Raton Regional Hospital, collectively employing over 6,000 employees.

#2 Citigroup Center: $300 million

Investment firm Monarch Alternative Capital has acquired a 90 percent stake in Citigroup Center, a 34-story office tower in downtown Miami, for $300 million. Monarch is taking over Townsend Group’s interest in the building, which is located at 201 South Biscayne Boulevard. Crocker partners will keep the remaining ownership stake. This deal will be the largest office sale in Miami since 2019.

Citigroup Center spans 813,000 square feet and is around 70 percent leased to tenants. The office tower connects to the Intercontinental Miami Hotel, and recently completed at $20 million renovation.

#3 Phillips Point: $282 million

An affiliate of developer Related Companies LP has agreed to purchase the Phillips Point office towers in West Palm Beach for $282 million. As of January 2021, the transaction was the largest office sale in South Florida. The complex, located at 777 South Flagler Drive and 201 Lakeview Avenue, is 448,914-square feet and is home to several high-powered financial firms including Citicorp, Goldman Sachs and Morgan Stanley. The Related affiliate financed the purchase with the help of a $198.5 million loan from Goldman Sachs. The complex sits on more than 4 acres overlooking Palm Beach Island. Phillips Point is currently about 90 percent occupied. New York-based Related Companies is led by Miami Dolphins owner Stephen Ross.

With more financial and tech firms announcing they are planning to open offices in South Florida, this sales trifecta won’t be the last of hot commercial real estate deals.

Contact Florida Bar Board-Certified Attorneys David E. Klein, Esq. and Guy Rabideau at Rabideauklein.com. They have the expertise and experience you need to ensure that your interests are protected throughout your real estate transactions in the Town of Palm Beach, across the Palm Beaches and throughout Florida. Contact Rabideau Klein to discuss the legal implications of your Florida property transactions.

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