The Real Deal Miami

RedSky buys Esperanté office tower in West Palm: $126M

Cornerstone Real Estate Advisers and Crocker Partners paid $71M for building in 2013

July 26, 2016 12:00PM
By Katherine Kallergis

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Esperante Office Tower

Esperante Office Tower

Brooklyn-based RedSky Capital just made a big office buy in West Palm Beach: RedSky paid $125.75 million for the Esperanté Corporate Center, records show.

Cornerstone Real Estate Advisers and Crocker Partners sold the 20-story, 256,100-square-foot building at 222 Lakeview Avenue. They paid $71 million for the property in 2013, which at the time was 60 percent occupied. Now, it’s 98 percent leased, according to a press release.

CBRE’s Capital Markets Vice Chairman Chris Lee, Vice President Jose Lobon and Financial Analyst Andrew Chilgren; and CBRE Debt & Structured Finance Vice President Amy Julian arranged the deal.

Esperanté marks the first South Florida office asset for RedSky, which has spent more than $500 million in the Miami neighborhoods of Wynwood and the Design District, as well as West Palm Beach. Bank of America financed the deal with an $85 million mortgage, records show. The buyer, 222 Lakeview LLC, is controlled by RedSky and is an affiliate of a RedSky/JZ LLC. JZ Capital Partners and RedSky have partnered on the majority of their South Florida deals.

Cornerstone and Crocker Partners renovated the Class A office building, including a new porte cochére and arrival point. New tenants include Cole Scott Kissane, Bank of America and the headquarters for both Chatham Lodging Trust and Island Hospitality, according to the release.

Esperanté is among the top three trophy properties in West Palm Beach, a market that has strengthened since 2007. Rents for the top three – Phillips Point, Esperante and CityPlace Tower — soared 9.8 percent to $53.74 a foot during the first quarter of 2016, according to a JLL report.

Overall, downtown West Palm’s direct vacancy rate fell to 13.8 percent in the first quarter, the lowest since 2007.

“Downtown West Palm Beach is a dynamic market, with growing demand for high quality corporate quarters. We were able to add significant value at Esperanté, backfilling space while the market was in recovery,” Angelo Bianco, Crocker Partners partner, said in a statement.

Built in 1989, the building was later certified LEED Gold.