Pebb Capital pays $40M for once-named Midtown Delray site

The mixed-use Delray Beach project is in an Opportunity Zone

TRD MIAMI /
Oct.October 23, 2019 03:30 PM
Midtown Delray, Todd Rosenberg

Midtown Delray, Todd Rosenberg

Pebb Capital closed on nearly 7 acres of land to build a project formerly known as Midtown Delray, months after the purchase was delayed due to a legal dispute.

Boca Raton-based Pebb Capital purchased five properties, totaling 6.7 acres, for close to $40 million along a historic portion of Atlantic Avenue where it plans to build a mixed-use project now renamed “Sundy Village.”

Marshall Florida Holdings was the seller.

Pebb Capital was previously set to close on the deal Feb. 28, but it was stalled due to a dispute between the two companies that assembled the development site, Delray Beach-based Hudson Holdings and Marshall Florida Investments of Raleigh, North Carolina.

The dispute was partly over the share of the proceeds from the sale of the Delray Beach site. The suit was eventually taken to court and settled when Marshall Florida bought out Hudson’s stake this summer, according to Todd Benson, a principal at Pebb Capital.

The project will cost over $100 million to develop and is in a federally designated Opportunity Zone. Opportunity Zones give investors and developers the ability to forgo or potentially defer capital gains taxes if they invest in distressed areas throughout the country.

The project will include nearly 50,000 square feet of retail and restaurant space and about 70,000 square feet of office space. Benson said construction will start within a year.

Office tenants will come from both Delray Beach and surrounding areas, since the project will consist of some of the only Class A office space in the city, according to Benson.

The company’s acquisition also includes Sundy House, a historic property that includes a restaurant, boutique inn and tropical garden. The group will also look to maintain six historic homes that it acquired in the purchase, Benson said.

Across the street from the commercial development, Pebb Capital also has land secured that has been approved for 100,000 square feet of residential units or hotel space. Benson said the company is not ready to disclose plans for the residential portion of the project.

Delray Beach is one of the hottest areas for new development in South Florida partly due to its walkable downtown.

Aventura-based BH3 recently got approval to build a mixed-use project in an Opportunity Zone on West Atlantic Avenue in Delray Beach. The project will include 43,000 square feet of retail, 21,600 square feet of office space, a grocery store, and 165 residential units.

In January, a joint venture led by 13th Floor Investments, Key International and CDS International bought the former Office Depot headquarters in Delray Beach for $33 million. The group intends to redevelop the property into one of the biggest projects in the city’s history.


Related Articles

arrow_forward_ios
Walgreens at 3200 South Federal Highway

Walgreens sells Delray Beach store on Federal Highway

JP Morgan's announces $5M investment in affordable housing in South Florida at the Black Archives Historic Lyric Theater in Overtown on Wednesday

JPMorgan to invest $5M to build 150 new affordable rentals in South Florida

Ben Carson

WATCH: Ben Carson dives into Opportunity Zones

Daily Digest Miami

Feds say FIU, FDOT contractors at fault for deadly bridge collapse, Infinity Real Estate looks to sell part of Paramount Bay in Edgewater: Daily digest

From left: Ben Carson and Grant Cardone

Opportunity Zones, luxury residential pricing, the diversity dilemma and more at TRD Miami’s Showcase & Forum

From left: Amir Korangy and Secretary of Housing and Urban Development Dr. Ben Carson

Ben Carson on Opportunity Zones, unity and red and black ants: TRD Miami Showcase & Forum

Alex Sapir and the site at 1768 Northeast Second Court (Credit: CBRE)

Alex Sapir’s massive Opportunity Zone site in Miami hits the market

Rendering of Ocean Delray

Ocean Delray nabs $73M construction loan

arrow_forward_ios