Bridge Investment Group’s office subsidiary Bridge Office Fund Manager (Bridge) and JV partner Ascentris announced it has completed the sale of Fountain Square, a three-building, 242,816-square-foot Class-A office campus located at 2600, 2650 and 2700 North Military Trail in Boca Raton.
Based in Boca Raton, the buyer, IP Capital, in joint venture with Edge Principal Advisors, paid $77.3 million for the office property. IP Capital currently owns and operates in excess of 6 million square feet across the state of Florida.
Located in the heart of Boca Raton’s leading office district and surrounded by a bevy of premier shopping and dining destinations, Fountain Square offers convenient access to I-95 and Florida’s Turnpike, and also lies in close proximity to residential areas that attract top professional talent.
Bridge and Ascentris purchased the property in 2017 and recently completed a $4.9 million capital improvement plan that delivered new lobbies, restrooms and common area corridors, modern exteriors, conference center, outdoor pavilions and signage, along with 23,000 square feet of high-tech, move-in-ready spec suites customizable for a wide array of users.
Bridge has overseen more than 121,000 square feet of leasing activity since acquiring the property, including more than 54,000 square feet of new and expanded agreements year-to-date. Tenants range from a variety of industries, including banking, legal, medical, dental, real estate and financial services. Three major retail centers, including Town Center at Boca and Boca Center, are located within two miles of Fountain Square, providing access to over two million square feet of retail options. Favorable demographics, a high quality of life and lack of new supply have caused market rents in Boca Raton to increase by more than 30% since 2013.
CBRE Capital Markets Vice Chairman Christian Lee and Executive Vice President José Lobón represented Bridge in the transaction.
“Bridge’s playbook in repositioning office space for the new needs of today’s workforce and ability to think ahead of the curve enabled us to add significant value for our investment partners on this project,” said Kelly Kuykendall, Managing Director of Asset Management at Bridge. “The improvements we have made at Fountain Square over the last few years and overall attention to detail were key factors in the success of the asset, creating a clean, fresh and modern workplace where tenants wanted to be, even through a pandemic. Balanced rent rolls and the ability for the new owners to capitalize on our investment position the building for a bright future in the decade ahead.”
“Ascentris is very pleased with the outcome of this investment,” said Ascentris Managing Director and Partner Tricia Noble. “The recent leasing velocity at the property demonstrates the continued demand for well-amenitized office space in growth markets. The investor interest in the property was very strong, as we are continuing to see in many of the top markets around the country.”
According to CBRE’s recent Q2 Office Marketview report, average asking rents across the Palm Beach office market continue to eclipse record highs, with demand leading to one of the strongest quarters on record for leasing activity.
“The lack of new office construction over recent years in Boca Raton has put significant upward pressure on market rents,” said Lee. “With a growing population base and job market in Boca Raton, continued upward pressure on rents is expected.”
Following the disposition, Bridge’s South Florida portfolio includes five additional properties, including Sawgrass Technology Park and 5601 Hiatus Road in Broward County, and 775,000 square feet across three assets in Miami-Dade County.
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