13th Floor Investments pays $26M for downtown West Palm Beach assemblage

Buyer paid $17M in one deal, $9M in another

Arnaud Karsenti and one of the properties at 435 Gardenia Street (Google Maps)
Arnaud Karsenti and one of the properties at 435 Gardenia Street (Google Maps)

Arnaud Karsenti’s 13th Floor Investments made a big play on downtown West Palm Beach, with the purchase of a full city block for $26.1 million.

13th Floor, through an affiliate, bought the properties consisting of small commercial buildings on roughly 3 acres between Fern and Gardenia streets and from South Dixie Highway west to South Quadrille Boulevard, according to records.

In the biggest of the two deals, the Coconut Grove-based real estate investment firm paid $17.1 million for the real estate at 415, 417 and 421 South Dixie Highway, as well as at 419 and 435 Gardenia Street.

Seller Bright Blu, managed by Conor Capital in Fort Myers, assembled the real estate for $5 million 2018 and nearly $2 million in 2019, records show.

In the other deal, 13th Floor Investments paid $9 million for the real estate at 418 and 464 Fern Street, 401 South Dixie Highway and a small adjacent lot. The seller, an affiliate of real estate investor and developer Jupiter Realty Company, assembled the properties for $2.2 million in 2012 and $1.3 million in 2018, records show.

The real estate includes a three-story office building constructed in 1965, a two-story office building, constructed in 1930, and a closed retail-office building constructed in 1925.

13th Floor Investments did not immediately return inquiries about its development plan for the site. The city said it has not received any development proposals for the properties.

Karsenti allegedly was the victim of an extortion scheme by father and son real estate duo Bruce and Shawn Chait, who were arrested in March over accusations they tried to shake down millions from Karsenti in connection with Tamarac housing communities he built.

The scheme also allegedly involved Tamarac City Manager Michael Cernech, who also was arrested in August over accusations he aided the Chaits.

13th Floor’s purchase marks the latest firm to make a play on downtown West Palm Beach. Stephen Ross’ Related Companies has invested heavily on the office market there, scooping up three towers, completing development of a fourth and planning a fifth.

Related bought the two Phillips Point office towers for $282 million, the CityPlace Tower for $175 million and half of the ownership interest in Esperanté Corporate Center for an undisclosed amount. It also completed and fully leased 360 Rosemary and is planning One Flagler.