Related Cos. has expanded its downtown West Palm Beach, Fla., office footprint with the $175 million purchase of CityPlace Tower, as first reported by the South Florida Business Journal and confirmed by public records.
The seller, W.R. Berkley Corp., picked up the 18-story, 297,652-square-foot asset in 2014, for $150 million, according to CommercialEdge data. Related assumed $101.8 million of outstanding debt from the seller, with Metropolitan Life Insurance Co. as lender. The 10-year note and has a maturity date in 2028.
New York City-based Related was behind the largest single-asset office buy in Florida during the first quarter of 2021. In January, the company acquired Phillips Point in downtown West Palm Beach, for $281.9 million. The two-building property is situated four blocks east of CityPlace Tower and offers a total of 420,290 square feet.
Florida’s Growing Office Market
Developed by a partnership of Related Cos. and Crocker Partners LLC on a 1.3-acre site at 525 Okeechobee Blvd., CityPlace Tower came online in 2008. The building was part of the mixed-use CityPlace development, now known as Rosemary Square, a 600,000-square-foot lifestyle center along S. Rosemary Ave. Related still owns most of the development, which includes retail space, rental apartments, condos and offices. The company sold the office building in 2011 for $126.5 million.
The pandemic has led to growing investor interest in the South Florida office market. In the first quarter of 2021, West Palm Beach had 857,000 square feet of office space in the works, while investment sales amounted to $985 million across 4.3 million square feet, according to CommercialEdge. Related is currently wrapping up one of the largest office developments in the market, dubbed 360 Rosemary. The 300,000-square-foot, 20-story property’s tenant roster includes co-working operator Spaces, Elliott Management and Levatas.