The Palmetto Promenade mixed-use development in Boca Raton is set to open in August, aimed at meeting housing and retail demand in the growing city.
The project, located at Palmetto Park Road and Northeast Third Street, consists of three nine-story buildings that will house 378 luxury apartments and 11,000 square feet of retail space.
“There’s demand for those residential units in East Boca,” Peter Reed, managing principal of Commercial Florida in Boca Raton, told The Real Deal. “Baby boomers and empty nesters are flocking to these kinds of projects.”
And on the retail side, “it’s a good location,” especially because there’s not a lot of space to fill, he said. To be sure, he expects the retail space to fill up more slowly than the residential.
Greystar, a national developer based in Charleston, South Carolina, is spearheading the project. “We look for high visibility sites within thriving communities that exhibit positive occupancy and rental rates within their multi-family properties,” Gary Wallace, managing director of development for Greystar, told TRD in an email. Downtown Boca, with vacancies in single digits and rents averaging more than $2.30 per square foot, fits that bill, he said.
The apartments will range in size from 712 square feet to 2,292 square feet, with monthly rental rates between $2,000 and $4,700 a month. The units include luxury finishes and appliances, while the complex’ amenities include a fitness center, resort pool and dog park.
In addition to baby boomers, the project can attract upwardly-mobile millennials and other professionals who want to live near their jobs, Keith O’Donnell, a principal at Avison Young in Boca Raton, told TRD. “There’s not a lot of new housing to accommodate a young software engineer, lawyer or accountant,” he said.
As for the retail, Greystar hopes to draw restaurants that serve all three meals, salons, coffee shops, dry cleaners —”any use that our residents would utilize,” Wallace said.
Though he supports the retail idea, Reed says this part of the project may be prove a bit more difficult than the residential end. “Sometimes the retail is a laggard” in these developments, he noted. The problem is that it takes time for retailers to build up a critical mass of customers, but given the cost of the project, the landlord will have to ask for a high rent, Reed said.
“That’s a challenge. You have to get retailers who are willing to pay the freight. It takes businesses with an established track record to withstand the kickoff price,” he said.
Looking at the development with a wider scope, Reed cites it as another example of an infill project in South Florida, and he expects that trend to continue, because there is so little land left. O’Donnell expects Boca to come to resemble Washington, D.C., “with little villages that connect with the city but can operate by themselves.”
Boca is in the midst of a construction boom, with new residential and commercial projects. Among them, Ram Realty Services recently completed construction on a 12-story, mixed-use building dubbed the Mark at Cityplace, with 208 apartments and 18,052 square feet of retail space on the ground floor. Also nearby, Kolter Group is building the 200-room Hyatt Place Hotel Boca Raton at 120 East Palmetto Park Road.