You have to like this one just for the price alone! Another Worth Avenue property sold for a ridiculous amount, in this case $146 million. Very Worth Avenue like numbers at over $1000 PSF (that is real estate talk that means Per Square Foot).
Sadly I had nothing to do with this transaction but it was very interesting to me so I did a little research on O’Connor Capital Partners. They are a privately held firm out of New York, not a brokerage firm. They seemingly brokered the deal on behalf of an unnamed institution but more than likely it was some sort of joint venture. In many deals there are two companies, one that sources the opportunity and in exchange gets many fees like a sales commission, management fees, etc. and becomes the operating partner. The other is the money partner who is really hands off and is usually only concerned about the rate of return. OCP (or should it be OCCP?) owns lots of high end properties around the nation, and some already in Florida including Cityplace.
While spending all this money on a property on Worth Avenue might sound risky to you, I don’t think it is for these reasons. First, is that there is a very limited supply of space in Palm Beach and even less for Worth Ave. This affluent shopping street is world renowned and the chances of it ever suffering a huge downturn are remote given the demographics of the Island. Second, this is the only mall type property on the street, making it very unique. It is irreplaceable and another like it will never be built there. That makes it more valuable. Next is the fact that due to its size it has large anchor tenants with solid credit. Finally, when you compare returns that can be had through banks, corporate real estate offers the opportunity to yield significantly higher returns. They probably got a hell of a deal on it in reality. So you too can do the same if you have a spare $146 million around. While I don’t, it will give me something to do in that I will need to call them and let them know if they are looking for someone to help them lease the property to look no further!
Orin Rosenfeld
President
Rosenfeld Realty Advisors
9858 Glades Rd. Suite 209
Boca Raton, FL 33434
Phone: 561-756-1665
Fax: 561-470-0707
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