Top 5 Office Transactions in Florida

Following the pandemic’s impact, Florida’s office sector is seeing a surge in office investment. In the first quarter, sales activity was concentrated in South Florida, where companies recognized the distinct opportunities arising from the shifting commercial real estate landscape.

According to data provided by CommercialEdge, office investment sales in the first quarter of the year amounted to $985 million and totaled some 4.3 million square feet. This translates into a 24 percent increase from the $794 million recorded in the first quarter of 2020.

Investors focused on Class A assets, buildings occupied by prestigious tenants from the law and financial sectors, amenitized portfolios and value-add opportunities. The list below highlights the largest deals closed in Florida between January and March 2021, based on CommercialEdge data. The top five office deals amounted to $658.2 million, equal to 67 percent of the quarter’s total sales volume.

Source: CommercialEdge

5. Advance Tower, South Miami

Advance Tower

In January, The Ardent Cos. purchased Advance Tower, a 140,000-square-foot office building at 6262 Sunset Drive in South Miami. The nine-story asset traded for $36.7 million and was sold by USAA Real Estate, which purchased it in 2015 for $40 million from Advanced Development.

Completed in 1986, Advance Tower features 15,556-square-foot floorplans and includes amenities such as covered parking and controlled access. The single-tenant property serves as the headquarters of Interval International, a vacation exchange network.

4. Cypress Financial Center, Ft. Lauderdale

Cypress Financial Center. Image via Google Street View

Also in early 2021, Vision Properties acquired Cypress Financial Center, a 198,528-square-foot office building in Ft. Lauderdale. The property traded for $44.2 million, with Benefit Street Partners providing $27.6 million in acquisition financing. The asset previously changed hands for $32.5 million in 2014, when a partnership between Steelbridge Capital, Square2 Capital and Apollo Global Management purchased it from Tricony.

The 11-story property was completed in 1988 and underwent renovations in 2015. Last March, Toronto-based Slate Office REIT entered into an agreement to purchase the asset for $45.5 million, but the deal fell through due to pandemic-generated uncertainty.

3. The Offices at Sunset Place, South Miami

The Offices at Sunset Place

Midtown Opportunities paid a joint venture between Federal Realty Investment Trust, Grass River Property Co. and Comras Co. $65.5 million for The Offices at Sunset Place, a 514,000-square-foot office and retail asset in South Miami.

The three-story property was completed in 1999. Once a popular mixed-use destination, the asset previously traded in 2015 for $129.6 million, double the amount it sold for this year. The deal is representative of a struggling retail sector, which was facing challenges even before the pandemic. However, the property has an open-air format, a feature that had been gaining popularity prior to the health crisis and has now become a sought-after amenity.

2. Two & Three MiamiCentral, Miami

Three MiamiCentral

Florida’s second-largest office deal was EQ Office’s purchase of Two and Three MiamiCentral, a 333,438-square-foot office portfolio in Miami. The Chicago-based REIT paid Shorenstein $230 million for the buildings, which previously traded for $159.4 million in 2019, one year after their completion.

Shortly before deciding to purchase the assets, the new owner signed a lease to occupy 41,000 square feet within Two MiamiCentral for its Technology & Innovations branch. The space will accommodate 200 new employees. The campus’ tenant roster includes other institutional tenants such as Carlton Fields and Ernst & Young, as well as Viacom, Virgin Group and CONCACAF.

1. Phillips Point, West Palm Beach

Phillips Point

In the first quarter’s largest single-asset deal in Florida, Related Cos. acquired Phillips Point, a two-building property in downtown West Palm Beach, for $281.9 million. AEW Capital Management was the seller, while Goldman Sachs originated $150 million in acquisition financing. The former owner acquired it in 2015 for $245.5 million from PGIM Real Estate.

Completed in 1985 and 1988, the East and West towers encapsulate 420,290 square feet of office space and include 40,000 square feet of retail. Phillips Point is home to tenants such as BMO Harris Bank, Goldman Sachs, Akerman, Regus and Wexford Capital.