The Real Deal Miami

Gaedeke offloads West Palm offices to investment manager for $68M

Seller tripled its money after holding on for 23 years
By Sean Stewart-Muniz | March 09, 2016 04:30PM

The office plaza at 515 North Flagler Drive in West Palm Beach

The office plaza at 515 North Flagler Drive in West Palm Beach

The Gaedeke Group just sold an office complex in West Palm Beach to a Connecticut investment manager for $68.24 million.

Included in the deal were three parcels: a low-rise parking garage at 517 North Olive Avenue, the 21-story office tower at 515 North Flagler Drive and its smaller four-story sister building next door.

The trio are connected by a pair of elevated glass-enclosed walkways, one of which crosses over North Olive Avenue between the garage and the main tower.

Dubbed Northbridge Center, the 1980’s-era plaza has been owned for the last 23 years by the Gaedeke Group of Dallas, Texas.

The plaza's entryway and sky bridge

The plaza’s entryway and sky bridge

The real estate company paid $24 million for the properties in 1993, according to Palm Beach County property records. With a combined 293,000 square feet of leasable office space (and some ground-floor retail), that price equated to about $82 per square foot.

Now, through a deal that closed this week, Gaedeke has sold the entire plaza to an affiliate of Connecticut’s Greenfield Partners. The investment management company paid nearly $293 per square foot for the property — more than triple the price it fetched two decades ago.

A large portion of the purchase was financed with a $56.75 million loan from Mesa West Real Estate Income Fund III, according to county records. The debt fund was raised by Mesa West Capital, a New York-based real estate lender with about $3.5 billion worth of assets, according to its website.

Gaedeke made its mark on South Florida last year when it closed one of 2015’s biggest commercial deals: the $142 million purchase of Brickell’s Espirito Santo Plaza office complex in September.