Cushman & Wakefield has negotiated the sale and financing of 1700 Palm Beach Lakes, a ±113,964-square-foot, Class A office building in Palm Beach County.
The Cushman & Wakefield Capital Markets team of Scott O’Donnell, Dominic Montazemi, Greg Miller, Miguel Alcivar and Michael Ciadella, with significant support from Cushman & Wakefield agency leasing specialist Anthony Librizzi, negotiated the sale on behalf of 1700 PBL LLC, an affiliate of Miami-based Breakers Capital.
Hackensack, New Jersey-based Capstone acquired the building for $19.35 million, or about $170 per square foot.
Jason Hochman of Cushman & Wakefield’s Equity, Debt & Structured Finance group assisted the purchaser in securing an $18.4 million acquisition loan from Blue Vista Finance on behalf of Capstone.
1700 Palm Beach Lakes is an 11-story office tower developed in 1988 on a ±1.24-acre site at 1700 Palm Beach Lakes Boulevard. The property features structured parking, a covered entrance and premium interior finishes, providing a true Class A experience.
Ownership recently completed a capital investment program valued at nearly $2 million that included a complete elevator modernization, complete lobby and garage restorations and a full-building generator replacement.
1700 Palm Beach Lakes’ location along the Palm Beach Lakes Boulevard corridor offers tremendous connectivity to greater West Palm Beach and the central business district (CBD) via the adjacent Interstate 95 interchange, North Congress Avenue and North Australian Avenue. The property is positioned to capitalize on the corridor’s recent transformation, marked by the development of the Palm Beach Outlets and the Hilton Garden Inn West Palm Beach at the Outlets, which serves as Spring Training home for the Houston Astros.
The property was 89.4% occupied at the time of sale. Notable tenants include the Internal Revenue Service (IRS), Valley National Bank, Uniters North America and Comcast Spotlight. The IRS will vacate more than ±32,000 square feet in 3Q 2019, dropping occupancy to 61.1% and creating a tremendous value-add opportunity for new ownership.
“The IRS’ departure actually creates an exceptional value-add opportunity to update a significant swath of older space in the building, bringing it more in line with the needs of modern, smaller tenants which are prevalent in this submarket,” said O’Donnell. “The building is a best-in-class asset and offers Capstone upside potential given the ideal combination of positive market fundamentals, rapid nearby development and potential for a complete property rebranding in one of South Florida’s most exciting cities.”
