Financial Center at the Gardens was purchased for $71.8
million by New York Life Insurance Company, one of the largest life insurers in
the world. KBS originally purchased the property in 2015 in a joint venture
with a sovereign partner.
Located along the PGA Boulevard micro-market, Financial
Center at the Gardens is within walking distance to the 1.4 million sf Gardens
Mall and is adjacent to Downtown at the Gardens, a lifestyle center that
includes numerous restaurants, retail, entertainment venues, country clubs and
golf courses, providing an excellent walkable amenity base for tenants.
Financial Center at the Gardens offers easy access to Interstate 95 and the
Florida Turnpike. Tenants will also have easy access to Orlando with the
pending Tri-Rail station which will sit near the Florida East Coast tracks at
PGA Boulevard. Over the past few years, KBS spent more than $1 million to
renovate the property including a main lobby renovation with a new lounge and
wine bar as well as upgrades to the café, restrooms, corridors and elevators.
“Targeting growing cities, such as Palm Beach Gardens is an
explicit part of our investment strategy,” said Allen Aldridge, senior vice
president for KBS and asset manager of the property. “Palm Beach Gardens has
proven to be a developing market with positive real estate dynamics which has
made it easy to keep the building nearly 100 percent leased.”
During the first quarter, the overall vacancy rate for
office space in Palm Beach County remained near historic lows at 13.3 percent,
down 81-basis-points year-over-year, according to Cushman and Wakefield’s Q1
2019 Palm Beach County Report. Overall absorption exceeded 78,000 sf in Q1
2019, the highest Q1 absorption recorded in nearly 5 years.
Palm Beach Gardens is the largest municipality in North Palm
Beach County and the center of commerce and population density. Home to the
Benjamin School, one of the country’s elite private schools which attracts many
wealthy executives and high-profile families, alumnae include Tiger Woods and
“KBS is extremely deliberate in implementing our real estate
strategies and selling assets at an opportune time,” added Marc DeLuca,
regional president, Eastern United States for KBS. “As demand rises in these
secondary and tertiary markets, we continue to attract a highly competitive
field of potential buyers and secure pricing levels that deliver strong overall
returns, in excess of our underwriting, for our investors.”
“Investor interest in this uniquely positioned premier asset
was robust,” said Mike Davis, vice chairman for Cushman & Wakefield who led
the sales team. Mike Davis, Dominic Montazemi, Rick Brugge and Scott O’Donnell
of Cushman & Wakefield represented KBS in the transaction.