Bridge Investment Group relinquished a Miami-Dade County office building in a deed in lieu of foreclosure and sold a nearby property for $20.8 million.
The deals came as both buildings are struggling with high vacancies.
Panattoni Development acquired both the half-vacant Building 1100 at 10451 Northwest 117th Avenue and Building 1300 at 9675 Northwest 117th Avenue, which is about 44 percent vacant, according to records and real estate database Vizzda. Both properties are within the Flagler Station business park in unincorporated Miami-Dade County.
For Building 1100, Wells Fargo, Bridge and Panattoni agreed that the bank would assign its loan to Panattoni. This allowed Panattoni to step into the shoes of Bridge’s lender and gave it the power to take over the property through a deed in lieu of foreclosure. The deal is valued at $21.1 million, according to Vizzda records.
A deed in lieu allows owners facing low occupancy, financial trouble or other woes to hand over a property to the lender, avoiding a prolonged judicial foreclosure. Under a deed in lieu, a borrower is released from payment guarantees, and the lender vows not to pursue lawsuits.
Irvine, California-based Panattoni paid $20.8 million for Building 1300, borrowing $14.6 million on the property from Pinnacle Bank, records show.
Salt Lake City, Utah-based Bridge Investment had paid $85.8 million for the pair of properties in 2018, as well as Building 1200 at 9725 Northwest 117th Avenue. At the time, it took out a $64.6 million loan from Wells Fargo. It’s unclear how much is outstanding on the financing.
Bridge Investment kept Building 1200, which is between Building 1100 and Building 1300.
South Florida’s office market generally has remained stronger than other big metropolitan areas. From late 2020 through 2022, the tri-county region became a magnet for out-of-state companies. More recently, the market has felt the sting from elevated interest rates, skyrocketing insurance and a slowdown of the influx of companies. Some developers scrapped planned office projects and others are experiencing financial woes, either selling at a loss or facing foreclosures.
Led by Jonathan Slager, Bridge Investment sold the Sawgrass Technology Park consisting of 11 two-story buildings at 1601-1699 Northwest 136th Avenue in Sunrise for $49 million last year. The sale marked a 34 percent discount from Bridge Investment’s purchase price in 2019.
In October, lender Värde Partners sued to foreclose on Affinius Capital’s $68.9 million loan on the two-building Columbus Center at 1 Alhambra Plaza in Coral Gables. The debt had ballooned to $77.4 million, including interest and fees, Värde alleged. The court-appointed receiver overseeing the property sold it to Tourmaline Capital Partners for $76 million in March.
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