(Crystal Proenza is associate editor of Real Estate Florida.)
[IMGCAP(1)]CORAL GABLES, FL-AEW Capital Management, a Boston-based institutional pension fund advisor, has acquired the 224,049-sf 355 Alhambra Circle building from owner JP Morgan Investment Management. The 16-story class A tower was on the market for less than four months and sold for a price between $90 and $100 million in an all cash transaction, according to industry sources. This is the second purchase AEW has made from JP Morgan in the past four years. The firm acquired 550 Biltmore Way, a 160,000-sf Coral Gables office building, in 2004.
The deal is part of a growing trend of institutional buyers purchasing buildings on behalf of investor funds in all cash transactions, as reported by GlobeSt.com last month. Just weeks ago Deka Immobilien, a German open-end property fund based in Frankfurt, acquired the 207,000-sf BAC Colonnade class A office building for $82.9 million in all-cash transaction.
And there's more to come. USAA Real Estate Co., which already owns Columbus Center office building, is under contract to purchase another Coral Gables property, the Alhambra Plaza, according to local brokers. That deal is a collective purchase USAA would make from owners Crescent/Morgan Stanley including Two Alhambra Plaza, a class A office tower and Alhambra West, a class B office building located on the same block at 95 Merrick Way.
[IMGCAP(2)]"Two institutional owners are doubling down all within a few months of each other," says Jay Caplin, executive director with the capital markets group of Cushman & Wakefield. Caplin, along with Adam Feinstein and Eric Williams of C&W, represented JP Morgan in the sale of 355 Alhambra.
"The institutional investors who are buying here tend to be longer holders and look for premier trophy property, like 355 Alhambra," Carol Ellis-Cutler, senior vice president-partner of Colliers Abood Wood-Fay, tells GlobeSt.com. "The class A properties that are trading in Coral Gables have been sought after because of a few specific advantages that the submarket has to offer. The barrier to enter is extremely difficult because of limited land availability. Also the 175 multinational corporations that are located in here makes this submarket extremely attractive, helping it to maintain a stable occupancy and keep rental rates rising."
355 Alhambra was developed in partnership with JP Morgan and was sold because it reached the end of its target holding period, says Caplin, adding that the owner had two institutional offers to buy the tower. The building is currently 93% occupied by tenants including Kraft Foods Latin America, Merrill Lynch, Washington Mutual Bank, Wells Fargo Bank and Esslinger Wooten Maxwell. Taylor & Mathis has been named the new leasing and management company.
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