Tag Archive for: related companies

West Palm Beach

Real estate agents are increasingly concerned that first-class office buildings offer too much space to sublet shadows.

Even though another project needs to be considered, downtown West Palm Beach’s office market is full of empty space, and real estate professionals say there is little demand for renters outside the area to rent large offices.

Surveys of real estate developers and estate agents indicate that the city’s Class A office buildings, which usually attract the top tenants, have sufficient space directly in the buildings or by office tenants who are trying to rent their space. These sublet offices are a shadow market, indicating that the actual supply of office space is much larger than expected. In fact, the prime A buildings are about 80 to 85 percent full, which means that at least 10 to 15 percent office space is available in each building.

“There are big holes in all buildings,” said a real estate agent who asked not to be named. “Where’s the demand?”

The space flood is revealed when two new office buildings are constructed in downtown West Palm Beach and a third tower is due to be approved by a city committee. The Downtown Action Committee will vote on whether the One Flagler office tower will be allowed to raise 25 floors on land if it has five floors near South Flagler Drive and Okeechobee Boulevard.

The tower would offer 261,000 square meters of office space for rent. These buildings complement the existing range of first-class spaces in the city center. This area includes Class A buildings such as Phillips Point, Esperante and CityPlace Tower.

“Back in June, I had 17 percent vacancy in front of the new buildings,” said Neil Merin, chairman of NAI / Merin Hunter Codman in West Palm Beach. “Adding Rosemary 360 and One West Palm, both under construction and scheduled to open in 2021, will bring the vacancy rate to 35 percent. With 360 Rosemary, One West Palm and possibly One Flagler, you’re talking about 750,000 square feet. But even in the prime, we can only take up 100,000 square feet a year. The space will not only last for years, but will also lower rents in other office buildings.”

A developer from Flagler, Related Cos., argued for the tall tower, saying there is a lack of Class A rooms with the amenities and water views provided by private equity firms and hedge funds Northeast would be sought to make room in the city center. However, according to brokers and developers of commercial real estate in the city center, numerous high-quality office spaces are currently available.

“This is due to the fact that the market has seen flat to negative net absorption in the past two years when some companies left and others signed new contracts for smaller spaces,” experts said.

Real estate sources say the flood of space and new office buildings coming onto the market frighten some building owners who want it. In fact, it can be assumed that the Phillips Point office complex will be launched next year, as well as other buildings.

“The market is getting nervous,” said a source.

Phillips Point is a Class A office tower on 777 S. Flagler Drive. The two-tower complex offers water views, luxurious finishes, and a top tenant list. Among them: AMG, a global wealth management company.

AMG endeavors to sublet the entire 11th floor of the east tower, which is 16,000 square meters in size and offers a breathtaking view of the water. Also available is a first-class room with a view of the water on the 10th floor of the East Tower, which was once occupied by the Arnold & Porter law firm, which still rents out the room. The 8,000 square meters of space are available for subletting.

“In fact, 84 percent of the 460,000 square feet at Phillips Point are occupied,” brokers said.

Over there in Esperante, at 222 Lakeview Avenue, the 25,000 square meter tower, according to the real estate agent, has 48,000 square meters of rental space available, which corresponds to an occupancy rate of around 82 percent.

Even if sought-after hedge funds and private equity companies rent space, they don’t take much with them. Instead, they typically look for small offices that are sometimes between 800 and 1,200 square feet, according to an expert in commercial leasing. According to brokers, more than 95 percent of the Class A office buildings in the city center were fully let for a short time, but have adjusted to their historic occupancy rate of 80 to 85 percent.

“There weren’t many significant new businesses in downtown West Palm Beach,” said Peter Reed, managing partner of Commercial Florida Realty Services. “It’s still a mess” of existing downtown tenants.

For example, a new tower under construction, 360 Rosemary in Rosemary Square, has replaced Comvest from the nearby CityPlace Tower. It also attracted Lewis, Longman & Walker Law from Northbridge Center, where the firm rented 16,000 square meters. Now both the Cityplace Tower and Northbridge have to fill the soon empty space in their buildings.

At CityPlace Tower on 525 Okeechobee Boulevard, the last new tower in the city center since 2008, the occupancy of the building is only 72 percent according to the leasing information on the website and the broker data. The brokers market a 21,160-story sublease on the 9th floor. The rental price is $ 39 net per square foot, less than the market price of more than $ 50 per square foot for the area in the building.

In addition, according to the building’s website, the 300,000 square meter building has a further 64,127 square meters of rental space. This includes the top two floors where Intech used to be and which have moved to the One Clearlake Center on Australian Avenue.


Source: The Media Times

West Palm Beach

The West Palm Beach City Commission is set to take a final vote Monday on a proposed business district that would rezone part of the city’s downtown area.

The proposed Okeechobee Business District would change land-use rules in several blocks of the Okeechobee Boulevard corridor west of the city’s waterfront.

In particular, the district would allow The Related Companies to build a 25-story office building about 400 feet from the waterfront along Lakeview Drive, where current zoning limits building heights to five stories.

The Florida Department of Transportation (FDOT), Palm Beach County and the Town of Palm Beach have criticized the proposed business district.

The city should delay a vote on the business district to study the district’s impact on traffic, according to Stacy Miller, a regional director of transportation development for FDOT.

The city hasn’t demonstrated “the long-term adequacy of transportation facilities to meet established acceptable levels of service,” Miller wrote in an Aug. 7 letter to the municipal development services director in West Palm Beach.

The state Department of Economic Opportunity, which would have to approve the Okeechobee Business District, recently told the city it doesn’t object to the proposed district, but warned the city that failing to respond to objections from other state agencies could subject the district to challenges in court.

The city hasn’t shown how the high-rise Okeechobee Business District would benefit downtown West Palm Beach as a whole or surrounding areas, assistant county administrator Patrick Rutter wrote in an Aug. 3 letter to city officials.

West Palm Beach Mayor Jeri Muoio told the Palm Beach Post that the proposed business district drew “comments” from state agencies, “but they were not objections.”


Source: The Real Deal

West Palm Beach

After months of back-and-forth, the city commission of West Palm Beach finally approved the creation of an Okeechobee Business District.

The recent unanimous vote paves the way for a number of proposed developments, including the Related Companies’ 25-story office tower at 134 Lakeview Avenue. Related has not yet announced if it will go forward with its One Flagler project, according to the Palm Beach Post.

The district, proposed by Related last year, was voted down by the commission in September. Since then, the proposal was revised to encourage the use of transportation alternatives, like trolleys and bicycles, as well as some environmental-friendly alternatives, according to the publication.

The Okeechobee Boulevard corridor features some prime waterfront parcels on Flagler Drive and Okeechobee Boulevard. Currently, zoning in the area only allows for five-story buildings.

The measure now heads for state approval and will return to the commission in August for final city approval.


Source: The Real Deal