Spanish billionaire Amancio Ortega completed his $274.4 million purchase of Sabadell Financial Center in Brickell, marking the biggest office deal in South Florida so far this year.
Ortega’s Ponte Gadea investment family office bought the 30-story tower at 1111 Brickell Avenue in Miami from New York-based KKR and Orlando-based Parkway, according to records and real estate database Vizzda. Ponte Gadea did not record a mortgage, signifying this was likely a cash deal.
Chris Lee and Sean Kelly of CBRE represented the sellers.
The 524,000-square-foot Sabadell Financial Center was completed in 2000 on a 1.8-acre lot, as part of a larger mixed-use project that included the adjacent 296-key JW Marriott Miami. Kendall-based MDM Group and Brickell-based Rilea Group were the developers.
Tenants include co-working firm Industrious, marketing firm Tibint, Kennedys Law, Law Offices of Wolf & Pravato and commercial real estate services firm Northmarq.
KKR and Parkway had paid $248.5 million for the building in 2018, according to records.
KKR is led by co-CEOs Joseph Bae and Scott Nuttall, and Parkway is led by James Heistand, their respective websites show.
The deal comes amid slower South Florida office investment sales compared with the deal flurry during the pandemic. At that time, lower interest rates and an influx of out-of-state companies leasing big blocks of space prompted record rent growth and a sales spree. Over the past two years, elevated interest rates and some skittishness among lenders curbed the investment bonanza.
In Miami-Dade County, office deal volume reached $2.1 billion in 2021 and $1.1 billion in 2022, according to data provided by CBRE. Although volume dropped to $700 million in 2023, sales picked up last year to $1.4 billion. During the first half of the year and a portion of the third quarter, Miami-Dade sales totaled $293 million, the data shows.
Ortega’s Sabadell purchase surpasses the previous top South Florida office sales this year. In February, Bradford Allen Investment Advisors paid $208 million for Las Olas Centre I & II at 350 and 450 East Las Olas Boulevard in downtown Fort Lauderdale. Also in February, Lone Star Funds’ fund VII, Highline Real Estate Capital and Square2 Capital bought the Bank of America Plaza at Las Olas City Centre at 401 East Las Olas Boulevard in downtown Fort Lauderdale for $221 million.
Many of the players still purchasing offices are all-cash buyers that can avoid expensive financing. Ortega, best known as the founder of Zara and the Inditex clothing stores holding firm, is a cash buyer, reinvesting earnings from his retail empire into real estate globally through Ponte Gadea.
Ortega, who Forbes ranks as the 12th richest person globally with a net worth of $127.1 billion, has been especially active this year. This coincides with an expected record $3.6 billion in dividends this year from his retail holdings, with the billionaire possibly deploying cash into properties to shield his earnings from Spain’s hefty wealth tax, Bloomberg reported.
Purchasing all cash also allows for a reprieve on prices because sellers are more interested in the certainty of closing over getting the highest price in the current financing climate, an expert told The Real Deal in July.
Last month, Ponte Gadea paid $110 million for the fully leased Atlas Plaza retail building at 130 Northeast 40th Street in the Miami Design District. In June, it bought the 259-unit Veneto Las Olas apartment tower at 201 South Federal Highway in downtown Fort Lauderdale for $165 million.
In Paris, Ponte Gadea bought the five-star 90-key Hotel Banke for $113 million in July, and the eight-story office and retail property at 223 Rue Saint-Honoré from Hines for about 170 million euros (about $197.3 million) last month. In May, it paid $284 million for a 290,000-square-foot office building in Barcelona that’s home to Spanish book publisher Planeta’s headquarters. Ponte Gadea also reportedly is buying a 49 percent stake in Brookfield Asset Management’s PD Ports in the United Kingdom for an undisclosed amount.
