Pebb Capital, Intalex Capital Close Fort Lauderdale’s Largest Office Transaction Of The Year
Real estate and private equity firms Pebb Capital and Intalex Capital, in partnership with CDS International Holdings Inc. (CDS), announced the acquisition of a trophy ’Class A’ office building in the urban core of Fort Lauderdale.
The transaction, which closed on May 15, marks the largest ‘Class A’ office deal in downtown Fort Lauderdale this year.
Pebb Capital and Intalex Capital purchased 110 East, located at 110 East Broward Blvd., from Stockbridge for $43 million.
Christian Lee, Andrew Chilgren, Marcos Minaya and Sean Kelly of CBRE brokered the transaction on behalf of both the buyer and seller.
At the entryway to downtown Fort Lauderdale, 110 East is situated in the middle of 15,000 multifamily units developed in the last decade and is within walking distance to more than 30 restaurants and the famed Las Olas Boulevard. Conveniently located near major transportation hubs, the property is just two blocks from the Brightline Station and a 10-minute drive to Fort Lauderdale-Hollywood International Airport.
The 24-story tower consists of 343,500 square feet of space. During the pendency of the contract, Pebb Capital and Intalex Capital commenced leasing efforts and secured approximately 76,000 square feet of new tenancy.
The partnership is actively negotiating another 125,000 square feet of new leases to stabilize building occupancy years ahead of their anticipated underwriting. Travis Herring and Katherine Ridgway of Cushman & Wakefield have worked with Pebb Capital and Intalex Capital to oversee leasing velocity.
As a premier commercial offering, 110 East has the largest block of contiguous office space available in the market with panoramic views of the ocean, intra-coastal waterway and downtown. Adding to its prestige will be multi-million-dollar renovations to common areas, including bathrooms, fitness center, terraces and lobby, which follow substantial renovations completed by Stockbridge in 2021.
“This deal is a significant success for our portfolio, working nearly a year to finalize it as capital markets shifted,” said Todd Rosenberg, co-founder and managing partner of Pebb Capital. “South Florida has remained a bright spot in domestic office activity, with strong fundamentals to continue this trajectory of business and population growth. Combine this with Fort Lauderdale’s economic outlook and the value-add opportunity of 110 East, the conditions align with our office investment strategy of acquiring and developing more than 600,000 square feet in the tri-county area.”
Cushman & Wakefield’s Q1 2023 Broward County MarketBeat Office Report notes, in the coming quarters, an expected positive absorption year-to-date, with continued demand for larger leases in the Central Business District. The market also saw a historic record of overall office rates exceeding $55-per-square-foot this year. According to Intalex Capital Founder Bryson Ridgway, the deal and current market dynamics set in motion a concerted effort by the firms to aggressively acquire more South Florida office assets.
“110 East Broward is a great opportunity to take advantage of current dislocation in the office segment and capital markets,” added Bill Milmoe, President of CDS. “As soon as we completed our diligence and understood Pebb Capital and Intalex Capital’s business plan, we were enthusiastic to provide the LP capital for this very exciting project. 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.”
Greenwall Capital Management advised CDS in the transaction and Kapp Morrison, LLP provided legal representation to CDS.
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