Related Urban postpones Gateway Tower
Related Companies’ mixed-use development arm, Related Urban, shelved plans to build Gateway Tower at CityPlace in West Palm Beach due to a shortfall of interested tenants.
The tower was slated to be built in the median of Okeechobee Boulevard between Florida and Alabama avenues. Potential tenants, including Bank of America/Merrill Lynch and two law firms, reportedly backed out because they needed the space in less than 18 months.
Related would have needed at least two years to design and erect the roughly 200,000-square-foot building, the Palm Beach Post reported.
“If I’m building a 220,000-square-foot building, and I pre-lease 110,000 square feet, I’m taking a risk on leasing another 110,000,” president of Related Urban Ken Himmel told the Post. “We are willing to do that. But I’m not going to speculate more than 50 percent of the building.”
The company is still talking to interested businesses. But residents say demand for large commercial leases in the area are rare. Meanwhile, CityPlace Tower to the south has leased all but 15,000 square feet of the 300,000-square-foot building, despite high rents. [Palm Beach Post] — Angela Hunt