Miami investor pays $18M for Miami office building

UPDATED, April 27, 2:42 p.m.: Valoro Capital picked up a Miami office building for $18M, amid an uptick in South Florida sales in the sector.

An affiliate of Miami-based Valoro paid $218 a square foot for the nine-story, 82,298-square-foot building at 5040 Northwest Seventh Street, according to a press release. It is near Miami’s Blue Lagoon business district and Miami International Airport.

Avison Young’s David Duckworth, John K. Crotty and Michael Fay represented the seller, an affiliate of Ramapo, New York-based Northeast Capital Group.

The seller sold the property for $3.5 million above its purchase price in a little over a year. In January 2021, Northeast paid $14.5 million, according to records.

Completed in 1966, the building is known as 50Forty on 7th. More than half of the tenant roster is composed of medical office users, followed by business services and government tenants, the release states. Northeast Capital leased the building to 93 percent occupancy and achieved 25 percent appreciation during the 14 months the firm owned 50Forty on 7th, Duckworth said in a statement.

The property has maintained a 95 percent tenant retention rate over the past three years, Duckworth added.

With the building nearly full, Valoro can raise rents to current market levels due to an influx of out-of-state firms and average asking rents in the Miami Airport submarket reaching $39 a square foot in the most recent quarter, the release states. Led by managing partners Alberto Chocron and Francisco Cantor, Valoro owns more than 500 apartment units in three states, including Florida; more than 300,000 square feet of office space in the southeast U.S.; and more than 100,000 square feet of retail nationwide, according to the firm’s website.

Duckworth said office buildings in South Florida are experiencing strong investor demand and appreciation. In one of the most recent deals, Miami-based Beacon Real Estate Group paid $20 million for a Kendall office building primarily leased to Vitas Healthcare and Everglades University.

Also this month, Miami attorney Alex Hanna and his wife, Lizet Hanna, bought an office building on Miami’s Flagler Street for $15 million, and CS Ventures purchased a pair of office buildings along Bankers Row in Palm Beach for $35 million.

In Miami Beach, East End Capital and BentallGreenOak sold a Class A office building with ground-floor retail and a parking garage for $52.3 million. An entity tied to Boston-based The Davis Companies bought the four-story property.

Correction: A previous version of this story misstated the identity of the buyer.