A pair of apartment complexes in Palm Beach County traded hands, with one seller scoring a gain on the price and the other surrendering the property to avoid foreclosure.
Newark, New Jersey-based PGIM Real Estate sold the 340-unit The Quaye at Palm Beach Gardens at 10000 South Gardens Drive in Palm Beach Gardens to New York-based Dermot Company for $131.8 million, according to records and real estate database Vizzda. PGIM paid $118.7 million for the property in 2017, records show, and the sale marks an 11.4 percent gain.
Demot, led by Stephen Benjamin, assumed the seller’s $59.4 million loan, bumping it up to $110 million. Affinius Capital is the lender. The price breaks down to $387,600 per unit.
Completed in 2015, the gated complex consists of 30 three-story apartment buildings and a two-story clubhouse on 30.5 acres, according to Vizzda records. It has one-bedroom to four-bedroom units, with monthly rents ranging from $2,700 to $4,200, Apartments.com shows.
In the other deal, Honolulu-based The Shidler Group reassigned the ground lease and leasehold interest in lieu of foreclosure for the 433-unit SeaLofts at Boynton Village apartments at 600 Sealofts Drive in Boynton Village to Harbor Group International, according to records and Vizzda.
The deal is valued at $79 million, or the same amount as a loan Norfolk, Virginia-based Harbor Group had provided on the buildings on the site in 2021, records show.
An entity tied to The Shidler Group retained ownership of the land and still is the ground lessor, according to Vizzda records. The ground lease, signed in 2021, has a 99-year term.
The Shidler Group, led by Jay Shidler, has a strategy of owning the land and the buildings on it through separate entities and then leasing the land from itself.
Completed in 2020, the gated SeaLofts consists of nine four-story apartment buildings and 11 two-story apartment buildings, as well as a clubhouse on 19.4 acres, Vizzda records show. It has one-bedroom to three-bedroom units, with monthly rents ranging from $2,200 to $3,800, Apartments.com shows.
The two deals –– one for a gain and the other avoiding a foreclosure –– show the dichotomy playing out in South Florida’s multifamily market.
The tri-county region prospered during a pandemic-era influx of out-of-staters, creating unprecedented apartment demand and record rent growth. Generally, leasing still is strong, though the market also is experiencing a supply overhang, defined by slower lease-ups and a slight drop in rents, due to hefty unit completions in recent years.
At the same time, landlords have felt the sting of higher interest rates and increases in other costs, including construction materials and insurance, eating up their bottom lines.
Palm Beach County multifamily investment sales volume reached $1.9 billion last year, outpacing the $1.1 billion and $668 million in 2024 and 2023, respectively, according to Avison Young. Last year’s sales were on par with the $1.9 billion in sales in 2022 and less than the $3.9 billion in 2021.
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