AEW Capital could end up being the buyer of Flagler Station in Miami as part of an overall $1.2 billion TPG Capital deal to buy Flagler’s developed portfolio in Florida.
The sale price for the 4.1-million-square-foot Flagler Station is likely to be more than $300 million, or about $80 a square foot, at about a 5 percent cap rate, according to real estate industry sources who asked not to be named.
It is unclear as to whether the overall $1.2 billion price tag for the entire 12 million square foot Flagler portfolio includes Flagler’s operations, such as undeveloped property and management of property and leasing.
AEW Capital out of Boston already has its very large foot in the door, having provided $200 million to Fortress (NYSE: FIG), in a mezzanine-type arrangement, when Fortress refinanced its Flagler assets, which it bought earlier in 2007.
AEW’s controlling position in the debt allows it to reject TPG’s potential sale of Flagler Station to any other prospective buyer, an important wrinkle considering TPG has already hired CBRE to market Flagler Station for sale.
In the end, what will likely happen is that TPG and Parkway will carve out the office assets, including those in Jacksonville and Orlando, leaving Flagler Station for AEW, sources said.
In South Florida, Parkway owns several properties including 355 Alhambra in Coral Gables. Parkway has an investment interest in several Jacksonville properties, including the St. Joe Building at 245 Riverside Ave.
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