The 24-story 110 East office tower in Downtown Fort Lauderdale sold for $43M, with the new owners announcing they have already secured 76K SF in new leases.
An affiliate of Stockbridge Capital sold the 343K SF office building at 110 East Broward Blvd. to a partnership of Pebb Capital, Intalex Capital and CDS International Holdings. The group said the acquisition, which breaks down to around $125 per SF, positioned it to benefit from the continued migration to South Florida and steady demand for high-quality office space.
Amerant Bank provided a $49M loan for the acquisition, with the buyers drawing on $15M in capital to close the deal, a spokesperson for the buyers told Bisnow.
Todd Rosenberg, managing principal at Pebb Capital, said at a Bisnow event last month that his firm was actively working on 600K SF of acquisitions, taking advantage as other buyers held back.
“Once they get over this macro issue, we’ll be in at the right basis, and we’ll be full with a lot of great users with rent going up still," he said.
Stockbridge acquired the property in 2018 for $41M through a foreclosure sale after Cabot Properties defaulted on a mortgage with a $40M balance, The Real Deal previously reported.
Stockbridge secured a $47M loan from Bank of America at the time to renovate and upgrade the property, but the new buyers said the property would undergo new “multi-million-dollar renovations” to common areas, terraces and the lobby.
New leasing efforts at the property have been led by Travis Herring and Katherine Ridgway at Cushman & Wakefield. They are negotiating an additional 125K SF of new leases, according to the release, in addition to the 76K SF of new occupancy that was secured during the closing period.
110 East landed the largest new lease in the first quarter, according to a quarterly report from Cushman & Wakefield, with ABA Centers of America signing on for 32K SF.
The activity comes as much of the focus in the Fort Lauderdale office market has shifted toward the urban core and away from the once-popular suburbs. Fort Lauderdale’s central business district saw 26K SF of net move-ins in the first quarter. There was 54K SF of negative absorption across its suburban submarkets, according to the C&W report.
“110 East Broward is a great opportunity to take advantage of current dislocation in the office segment and capital markets,” CDS President Bill Milmoe said in a statement. “We are bullish on South Florida and have the utmost confidence in the team to execute the business plan. The rapid pace of pre-closing leasing activity confirms that this is going to be a superlative opportunity.”
This is the latest in a string of South Florida acquisitions for Boca Raton-based Pebb. In 2021, the investment firm acquired the Bancroft Hotel building in Miami Beach for $47M and is in the process of converting it to office space. The company also acquired a 7-acre development site in Delray Beach in 2019 and is developing the 140K SF mixed-use Sundy Village on the site.
The two other partners in the purchase are also based in South Florida. Intalex Capital is a private real estate investment firm led by Bryson Ridgway with an office on Las Olas Boulevard in Downtown Fort Lauderdale, steps from the 110 East office property. CDS International Holdings, with offices in Delray Beach, is the family office of billionaire Carl DeSantis.