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The Real Deal Miami

South Florida’s biggest office deals of 2017

Office towers in Miami and downtown Fort Lauderdale led the way
By Amanda Rabines | December 27, 2017 11:30AM

South Florida’s luxury office market, which often boasts gleaming high-rises set against sunny landscapes with water views, didn’t outshine the previous year in sales. But considering it survived some crazy weather (including a hurricane) and a shift in investment dollars towards multifamily and industrial real estate, the market remained relatively healthy.

Office towers smack in the middle of growing “live-work-play” cities like Miami and downtown Fort Lauderdale continued to collect the bulk of investor cash in 2017, though in smaller quantities compared to last year. Here, The Real Deal breaks down the top five.

1221 Brickell

Rockpoint Group pays $155M for 1221 Brickell office tower

Rockpoint Group went on a spending spree this year in South Florida, and of its many large-scale acquisitions, its purchase of 1221 Brickell in Miami’s financial district landed it in the top spot for largest office buy this year.

In April, the Boston-based private equity firm paid $155 million for the 27-story office tower at 1221 Brickell Avenue. The price tag for the 408,000-square-foot, Class A building broke down to $380 per square foot.

The seller, Blackstone Group’s Equity Office, shopped the property with brokerage firm HFF. Chicago-based LaSalle Investment Management said it was a joint venture partner with Equity One on the sale.

Blackstone Group’s Equity Office paid $107.3 million for 1221 Brickell in 2006. Tenants include Delta National Bank & Trust Company, American Capital Corp. and some law firms. Ground-floor restaurant tenants include Vapiano, Jimmy John’s Famous Sandwiches and Giardano Gourmet Salads.

Office Depot and CEO Gerry Smith

Office Depot buys its Boca Raton headquarters for $132M

In an against-all-odds deal, Office Depot came in second place with the acquisition of its headquarters in Boca Raton.

In August, amid slumping sales in the e-commerce industry, the office supply retailer paid $132 million for its headquarters at 6600 North Military Trail. The trade broke down to about $211 per square foot.

Around the same time of the sale, Office Depot posted a 9 percent decline in sales in the second quarter, down to $2.4 billion from $2.6 billion in the second quarter of 2016. The company also closed 31 stores during the first half of this year.

Despite the hefty price tag, Office Depot CEO Gerry Smith still scored a deal in the HQ purchase. The seller, Equity Commonwealth, unloaded the 29-acre property at a loss of about $39 million. The Chicago-based real estate investment trust, led by Chairman Sam Zell, paid $171 million for the complex in 2011.

The deal marked Palm Beach County’s largest office trade of 2017, according to data from Real Capital Analytics.

One Park Square and Jon Gillman

TA Realty drops $96M on Doral office building

In September, a company tied to TA Realty paid $96.1 million for One Park Square, marking one of the most expensive office sales to close in Doral.

TA Realty’s Gateway Renellie LLC bought the nearly 282,000-square-foot building from New Boston Fund, a Boston-based investment, development and management firm. New Boston Fund bought the building from an affiliate of Shoma Group in 2010 for $27.5 million. That same year, Shoma, who co-developed parts of CityPlace Doral with the Related Group, completed the 11-story building at 3470 Northwest 82nd Avenue.

Christian Lee, José Antonio Lobón and Andrew Chilgren of CBRE, along with Tere Blanca, Danet Linares and Andres del Corral of Blanca Commercial Real Estate, represented New Boston Fund in the deal.

One Park Square includes about 50,000 square feet of ground-floor retail space, a fitness center, conference center and parking. The office complex is leased to tenants including Latin World Entertainment Agency and Amadeus North America.

Street view of One Financial Plaza

Crocker Partners sells Fort Lauderdale office tower to Chicago firm for $87M

Also in September, a private equity firm based in Chicago made headlines after it bought a 28-story office tower in downtown Fort Lauderdale for $86.75 million, marking the most expensive office sale in the area this year.

Crocker affiliate One Financial Plaza LLC sold One Financial Plaza at 100 Southeast Third Avenue to W-Crocker Fin Place Owner VIII LLC, which is controlled by Doug Welker, principal of asset management at Walton Street Capital. Crocker Partners paid $44 million for the 4-acre property in 2011.

The office tower stands about two blocks away from Las Olas Boulevard, which is undergoing a commercial and residential resurgence.

The 276,572-square-foot, Class A office building was constructed in 1972 and was originally known as the Landmark Bank Tower. When it opened, it was the tallest building in Fort Lauderdale, and it is now the sixth tallest, according to Emporis. One Financial Plaza was renovated in 2011, data from Real Capital Analytics shows.

200 East Broward Boulevard

Banyan Street Capital buys downtown Fort Lauderdale office tower

Another downtown Fort Lauderdale office sale made the list, underscoring a recent uptick in market activity within the neighborhood.

Banyan Street Capital paid $81.5 million for the office building at 200 East Broward in October. The Miami-based firm acquired the building in a joint venture with funds managed by Oaktree Capital Management.

The joint venture spent $360 per square foot on the 226,000-square-foot, 21-story, Class A tower and financed the sale with a $55.5 million mortgage from MetLife.

The seller was Realty Associates Fund X LP, an affiliate of Boston-based TA Realty. The TA Realty affiliate paid $66.4 million for the building in 2014 and spent another $5.7 million on renovations. The office tower was built in 1992 and includes eight stories of podium parking.

Harunobu Coryne contributed reporting.