This is the latest Miami office tower to trade for a top-dollar price.
By Lidia Dinkova
A New York-based global investment firm and an office real estate owner and operator have bought the Sabadell Financial Center office tower in Miami for a reported $250 million.
The partnership between KKR, the investment firm, and Parkway Properties Inc., the office investor, bought the 30-story building at 1111 Brickell Ave. from PGIM Real Estate. The sale price wasn’t disclosed, but The Real Deal reported the price as $250 million.
The Sabadell Financial Center, also referred to as 1111 Brickell, is a 522,892-square-foot office tower on about 1.78 acres on the southeast corner of Brickell Avenue and Southeast 11th Street adjacent to the JW Marriott Hotel.
KKR, founded by Henry Kravis, Jerome Kohlberg and George Roberts in 1976, doesn’t appear to have other significant South Florida real estate assets. The global investment firm with $148 billion in assets under management has widespread holdings and has invested in Plantation-based Magic Leap Inc., according to its website.
For its part, Parkway Properties owns the Courvoisier Centre, which is a two-building office complex at 501 and 601 Brickell Key Drive on Brickell Key. The complex includes a parking garage.
KKR and Parkway didn’t provide insight on their joint purchase.
A KKR media representative said the company was unable to arrange an interview, and Parkway representatives didn’t return requests for comment.
This much is known: The two plan to put in $10 million into renovations and new facilities, like a new gym and conference center, according to John Guitar, managing director and vice chairman of Blanca Commercial Real Estate, the exclusive leasing agent for the office tower.
The new owners will renovate the common areas including the lobby, entrance, corridors, restrooms and the 10th floor amenity deck, according to a CBRE Inc. news release.
A CBRE capital markets team facilitated the sale, and a CBRE debt and structured finance team arranged financing from New York-based Square Mile Capital Management.
PGIM Real Estate bought the property through its affiliate, PR 1111 Brickell LLC, for more than $184 million from 1111 Brickell Office LLC in 2013, according to the Miami-Dade County property appraiser’s office. That translated to a 36 percent gain in five years.
The latest sale, made public late last week, breaks down to $478.11 per square foot.
The property is 89 percent occupied with some of the tenants being the Hunton Andrews Kurth and the Kelley Kronenberg law firms, Louisiana-based Iberiabank and Guggenheim Partners Latin America Inc.
“The new owners have long history of showcasing their strength of ownership and ability to bring top-tier hospitality to their buildings and truly reposition them into iconic projects,” Blanca Commercial’s Guitar said in part in an emailed statement.
The deal reflects a healthy office market in Miami’s urban core with several notable towers trading for top-dollar prices in recent years.
The SunTrust International Center at 1 SE Third Ave. was sold for $127 million May 11. Real estate finance and investment management firm PCCP LLC bought the tower from Boca Raton-based real estate investment firm Crocker Partners LLC.
The Southeast Financial Center, the iconic 55-story office tower at 200 S. Biscayne Blvd., sold for $516 million in December 2016. A company tied to the family office of Spanish billionaire Amancio Ortega, founder of the Zara apparel and accessories chain, made the purchase from financial giant JPMorgan Chase & Co.
In 2017, Rockpoint Group LLC bought 1221 Brickell, the 27-story office tower at 1221 Brickell Ave., for $155 million.