Gatsby Secures $100 Million Refi for Palm Beach-Area Offices

Gatsby Florida scored a $100.4 million refinancing for one Palm Beach County’s largest suburban office complex.

Cirrus Real Estate Partners provided a three-year, floating-rate loan to the company for DiVosta Towers in Palm Beach Gardens, a 220,000-square-foot Class A office campus at 3825 and 3835 PGA Boulevard, according to a news release.

Berkadia’s Charles Foschini, Scott Wadler and Shannon Wilson represented Gatsby in arranging the loan, which will be used to refinance the mortgage Berkadia brokered in 2022.

The pair of 11-story office buildings were completed in 2019 and 2020 by the DiVosta family, and at the time marked one of the first new office developments built in the submarket in more than a decade. Gatsby’s Nader Shalom and Babak Ebrahimzadeh paid the family $80 million in 2020 for the development.

JPMorgan, Wealthspire Advisors and Virtu Financial are among tenants with the largest leases in the towers.

Neil Merin of NAI/Merin Hunter Codman told The Real Deal earlier this year that more companies in Palm Beach County are looking to make the move to suburban submarkets after sticker shock from the over $100 per square foot rents in downtown West Palm Beach.

Billionaire Steve Ross’ hefty office investment and development in downtown West Palm supercharged the market, aligning with city and county boosters’ vision to attract more companies to the region.

Firms seeking more affordable leases have been driving demand for more office development in the suburbs of the county.

Gatsby has plans to build an eight-story, 220,000-square-foot office building, The Modern, and an adjacent six-story garage at 11200 RCA Center Drive in Palm Beach Gardens. Construction is slated to finish in 2027.

Ebrahimzadeh previously told The Real Deal that the project partly will target New Yorkers moving to South Florida following Democratic Socialist Zohran Mamdani’s mayoral win.

The project is 25 percent pre-leased for its 199,000 square feet of office space, and will feature 25,000-square-foot floorplates and tenant amenities such as a rooftop patio and a fitness center.

Gatsby paid $17.5 million in 2022 for the development site, which is near the firm’s DiVosta Towers office complex.

Cushman & Wakefield’s first quarter office report revealed

Palm Beach Gardens office landlords reported 24,400 square feet of positive net absorption in the first quarter and 13,800 square feet of leasing activity, while the vacancy rate stood at 8.6 percent, according to Cushman & Wakefield. Average asking rents hit $52.50 per square foot overall and over $60 per square foot for Class A offices.

Banks, lenders, wealth management companies and professional services industries in law and accounting are big office tenants in the city.

Gatsby’s South Florida office portfolio includes 800 Brickell in Miami, One Town Center in Boca Raton and 550 Okeechobee in West Palm Beach.