Vote Coming On Jackson South Medical Center Expansion
Marcus & Millichap Senior Managing Director Douglas K. Mandel , along with First Vice President Benjamin H. Silver, Associate Adam Klein and Debt Financing, Senior Director Eric Fixler, negotiated the sale of Highland Park Office Center, a ‘Class A’ office building in Miami’s Health District.
Mandel
TOPMED MIAMI HEALTH DISTRICT LLC purchased the 42,489-square-foot asset from HIGHLAND PARK CENTER LP, an entity managed by Key International for $13,875,000. Key International acquired the property for $7.850 million in 2014. The deal closed May 24.
“The asset was priced far below replacement costs and is situated in one of Miami Dade’s most dynamic and fastest growing markets with significant mixed-use and apartment developments taking place around the property,” commented Mandel.
Silver
The asset is one of the newest delivered office properties in the market and in proximity to the health district, one of Miami Dade’s fastest growing and highest demand office and medical office locations.
The two most significant challenges with the deal were that the primary tenant, a for-profit school, occupied over 60% of the GLA. Secondly, a third of the Property’s total income was derived from two billboards, which created a significant risk as a tremendous amount of the value of the deal hinged on the long term potential of that income.
“The deal worked for both sides as former ownership capitalized on accessing equity by selling a stabilized asset,” explained Silver. “The new ownership is now poised to take advantage of a longer term hold by capitalizing on rental growth and market appreciation in the future as well as the ability to rebrand the asset and acquire an asset below replacement cost.”
Located at 1011 Northwest Sunnybrook Road, the building’s site is strategically situated across from the University of Miami’s Jackson Memorial Hospital campus, two blocks from the Miami-Dade Court House and fronts State Road 836 (Dolphin Expressway), the main artery between Miami International Airport and Miami Beach.
The 2011-built building, which features structured parking, had gone through a bankruptcy and was acquired mostly vacant aside from significant wallscape income. Key International acquired the asset and immediately filled most of the space with Atlantis University, a for-profit school, which favored the property due to the highly visible nature of the signage rights and accessibility throughout the county for its student body. Despite being an ideal medical location, the school lease fell into the owners’ laps with the additional ability to build out the space in a modern, highly-functional way, which made financial sense. The remaining tenants were a mix of small professional and medical tenancy.
Source: CRE-sources
