The Real Deal Miami

Palm Beach Outlets scores $165M in financing

Property was sold for $278M three weeks ago
June 17, 2015 05:30PM

Rendering of the Palm Beach Outlets

Palm Beach Outlets in West Palm Beach has landed a massive $165 financing deal from an unnamed institutional investor.

News of the deal comes just three weeks after the shopping center was purchased for a staggering $278 million, marking the second-most-expensive commercial deal in Palm Beach County’s history.

Its new owners, New England Development and a fund managed by Clarion Partners, used a portion of the loan to make the acquisition. The rest of the funds are described as “long-term, fixed-rate loan” that cover both the existing 459,633-square-foot shopping center, and land that will house a future development with 105,000 square feet of retail space.

The loan comes from Cornerstone Real Estate Advisors, which worked on behalf of an unnamed institutional investment. Cornerstone has offices around the world, and manages more than $47 billion in assets, according to its website.

Riaz Cassum and Chris Drew of HFF represented the borrower for the deal, according to a press release.

Palm Beach Outlets was built in 2014 on the site of the former Palm Beach Mall. The mall became troubled near the end of its lifetime, and was even the scene of a murder before closing in 2010. It was sold for $35.5 million a year later to a group that included Eastern Real Estate and Lubert-Adler, as well as New England Development. The team redeveloped the property into the Palm Beach Outlets, which has enjoyed a strong lease rate of 96 percent and is anchored by Saks Off 5th Avenue.

The new complex is considered a hugely successful redevelopment, and its recent sale is an example of Palm Beach County’s strengthening retail market. — Sean Stewart-Muniz