Downtown West Palm Beach’s office market is booming. But not everyone can afford to stay.
Billionaire Steve Ross’ hefty office investment and development in downtown West Palm supercharged the market, aligning with city and county boosters’ vision for growth. And Ross’ towers have become a magnet for tenants.
As Ross’ investment increased rents across downtown West Palm, including in buildings he doesn’t own, some longtime area tenants have been priced out, leading them to seek space in suburban Palm Beach County areas, the Palm Beach Post reported. Development in these less flashy submarkets also is picking up, the outlet reported.
Law firm Lytal, Reiter, Smith, Ivey & Fronrath moved the majority of its office to Palm Beach Gardens last year from its space at downtown West Palm’s Northbridge Centre, where it was a tenant for four decades.
Vanderbilt Office Properties and Trinity Capital Advisors own Northbridge.
“The proposed renewal rate was three to four times what we were paying,” Lytal Reiter’s Kevin Ryan told the publication, saying downtown rates are “out of control.”
Lytal Reiter, which focuses on personal injury and medical malpractice, opened its Palm Beach Gardens office at 4300 TBC Way.
Others are looking to make the move after getting sticker shock from the over $100 per square foot rents in downtown West Palm, according to Neil Merin of NAI/Merin Hunter Codman.
At least two office projects are on tap in suburban Palm Beach County.
Gatsby Florida, an arm of Gatsby Enterprises, plans the eight-story, 220,000-square-foot office building, The Modern, and an adjacent six-story garage at 11200 RCA Center Drive in Palm Beach Gardens.
Shortly after last year’s election in New York, Babak Ebrahimzadeh of Gatsby Florida told The Real Deal that the project partly will target New Yorkers moving to South Florida following Democratic Socialist Zohran Mamdani’s mayoral win.
Construction completion of The Modern is expected in 2027.
Gatsby paid $17.5 million in 2022 for the development site, which is near the firm’s DiVosta Towers office complex.
In Boca Raton, the two-building, 140,000-square-foot The Aletto office complex is under construction and about 60 percent pre-leased.
These office developments are partly driven by demand for top tier offices in the suburbs, developers and brokers told the outlet.
Ross, 85, stepped back from New York-based Related Companies, which he founded over 50 years ago, in 2024 to start and lead West Palm-based Related Ross. That firm primarily focuses on downtown West Palm. Ross, owner of the Formula One Race and the Miami Dolphins, also has completed and is developing condos, apartments and hotels in West Palm. He has about a dozen office buildings in the submarket, including those purchased, completed, under construction and planned.
He tapped his New York network to quickly tenant his office buildings, primarily with out-of-state financial services firms. More recently, Related Ross also has made a push to turn Palm Beach County into a tech hub.
Ross remains nonexecutive chairman of Related Companies and its biggest single shareholder.
–– Lidia Dinkova
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