Steelbridge Capital, Apollo Global JV Buys Miami Office Tower
- Dec 27, 2012
In a joint venture, Steelbridge Capital, a value focused real estate investor based in Miami, and a real estate investment fund managed and advised by affiliates of Apollo Global Real Estate Management, L.P., have acquired Concorde Centre II, a 10-story, 106,500-square-foot office building in Aventura, Fla.
“Office assets rarely trade in Aventura and they are a highly sought-after asset class,” Jay Caplin, Steelbridge Capital’s managing principal, told Commercial Property Executive. “While Aventura is technically a suburban location, the nature of the area is very urban with a minimal supply of commercial and residential development land.”
The Class B building will be renamed Aventura View and undergo an expansive strategic capital improvement plan, expand property marketing and amenities, and introduce institutional quality property management and leasing.
“While the asset is in good condition and reasonably well leased, Steelbridge saw multiple value creation opportunities by bringing institutional management and leasing to the asset,” Caplin said. “Aventura View’s location, combined with the fact that the average tenant size is smaller and many of the tenants have been at the property for many years, generally translates into a higher tenant retention rate.”
Located in the heart of Aventura’s business corridor at 2999 NE 191st St., the transaction marks the largest office purchase in the area in 2012.
Aventura View is immediately proximate and visible to Aventura Mall, one of the top grossing malls in the country, and the area is characterized by dense vertical residential development.
“As a result, the office supply generally has not expanded significantly over multiple development cycles as it has always been very expensive to deliver new office product due to the cost of land,” Caplin said. “With such strong barriers to entry, as the economy continues to improve and the supply of office product remains relatively constant, demand for office space will be directed to existing properties that are well located and positioned, such as Aventura View.”
Aventura View is a rare property in that it has been owned by the same partnership since it was built in 1988. Steelbridge Capital identified this off-market property and the deal was negotiated principal to principal.
“Steelbridge is a value-oriented investor with a special expertise in submarkets with high job growth and strong natural barriers to entry,” Caplin added. “Our program targets the acquisition of real estate where the value has been temporarily discounted due to supply/demand imbalances in real estate capital or market fundamentals and which can be significantly enhanced through redevelopment and repositioning. By implementing a strategic and highly visible marketing campaign, in combination with a capital improvement program, Steelbridge envisions being able to create long -term value at Aventura View.”
It is anticipated that Steelbridge will implement a program that focuses on several major components of the building that will most improve the tenant experience including upgrades to the parking lot, improvements to the lobby and common areas, and some enhancements to the mechanical systems.
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