A mid-December sale has cracked the top 10 commercial sales of the year in South Florida, it was announced today. (Click here to see the rest of the biggest commercial sales of 2010.)
The landmark Miami Tower sold for $105.5 million in a deal that closed this past Friday. Perhaps the most recognizable office tower in Miami, the 600,000-square-foot building, designed by architect I.M. Pei, was featured in the opening credits of “Miami Vice.”
Marketing for the tower began in September, and by the end of October the seller, Blue Capital U.S. East Properties, had chosen buyer I & G Miami over another unnamed bidder.
Bilzin Sumberg attorney Carey Stiss, who represented Blue Capital, said the deal happened in an especially short time, given the logistical issues for purchasing a tower of this size.
The sale came through despite several potential obstacles surrounding the size of the building.
The first was acquiring tenant estoppel letters — statements from tenants showing what the basic terms of their leases were, like the rent, and that there were no defaults on the lease. Second, and perhaps more difficult, was getting consent from the city. Last was the issue of the lights that give the building its position in Miami’s nighttime skyline.
The only thing any buyer of the building owns outright is the tower itself; the parking garage on which it stands is leased from the city.
“The city leased the air rights initially to the first developer, which was SunTrust, when it existed back in the 1980s,” Stiss said. “So although the current owner now owns the building that sits on top of the parking garage, it’s really an air rights lease.”
Additionally, some of the lights which have given it its iconic place in the nighttime Miami skyline sit on top of other sites, including the nearby Metro Mover tram and several other properties. Tenant estoppel letters needed to be obtained from these landlords as well.
The sale tops the previous high of 2010, the purchase of the U.S. Immigration and Citizenship Services building downtown for $95.1 million.
The property was not a distressed sale; East Coast also owns an office property in Washington, D.C. and, according to Stiss, decided to sell its Miami holding first.
Stiss cautioned, however, on seeing the sale as a broader sign for the commercial market.
“People ask me that all the time, because they see a sale like this and assume all the floodgates are going to open. The floodgates are not going to open — what this does say is that there are investors out there who are flush with cash looking for a good investment, and looking smartly at investments. I think that by buying this building they see a very smart investment — when you see pictures of Miami, or from the Goodyear Blimp, this is the one building that stands out at night.”
Current tenants include law firms Carlton Fields and Boies Schiller & Flexner and UBS Financial Services.