Redfearn Capital is selling a small office and retail building near Palm Beach’s Worth Avenue for $18 million, more than twice the $8.4 million it paid for the property roughly a year ago. The deal highlights intense demand for scarce, well-located office space on the island.
Key takeaways
The sale delivers a substantial gain for the Delray Beach-based investment firm:
- The 6,500-square-foot property at 317 Peruvian Avenue is under contract or has been sold for $18 million.
- Redfearn acquired the building for $8.4 million last year.
- The latest price equates to approximately $2,780 per square foot.
- The buyer’s identity has not been disclosed.
- Tenants include Sotheby’s International Realty, Pizza Al Fresco and Caroline Rafferty.
A sharp increase in value
Redfearn Capital originally expected to hold the low-rise Mediterranean Revival-style building for the long term. However, an unsolicited offer prompted the firm to sell after only about a year, according to Alex Redfearn.
The $9.6 million difference between the acquisition and sale prices represents a gain of more than 114 percent before transaction costs and other expenses. The property’s current county-assessed value is $6.9 million, substantially below the reported sale price.
Location and parking drive appeal
The building sits approximately one block from Worth Avenue, Palm Beach’s premier luxury retail corridor. Its built-in parking is another important advantage on an island where parking and developable commercial space are limited.
Redfearn refreshed the property with a new coat of paint but otherwise left the building largely unchanged. The firm’s ability to command a significantly higher price appears to reflect the property’s location, existing tenants and the shortage of office space on Palm Beach. Much of the area’s available office inventory is located across the bridge in West Palm Beach.
Part of an active South Florida market
The sale comes amid continued activity involving Palm Beach office and retail properties. Citadel founder Ken Griffin sold a 50,000-square-foot Worth Avenue office building for $86 million earlier this year after owning it for three years. CS Ventures also acquired 44,000 square feet of Palm Beach office and retail space, financing the purchase with a $22 million loan.
These transactions underscore investor interest in commercial properties that offer proximity to the island’s high-end retail, business and tourism districts.
Redfearn expands beyond Palm Beach
The Palm Beach sale is one transaction within Redfearn Capital’s broader Florida investment strategy. Earlier this year, Redfearn joined a group that acquired a 53-building industrial portfolio valued at $628 million.
The firm also owns industrial properties across Florida, including two Miami warehouses acquired for $36.7 million in a partnership with TPG Angelo Gordon. The company’s portfolio therefore spans both specialized Palm Beach commercial real estate and larger-scale industrial assets.
Sources
- Redfearn Sells Palm Beach Building for 2X Last Year’s Price, The Real Deal.