While New York's volatile office market is reeling from a record 20% vacancy rate and losing some tenants to lower-tax South Florida, there is additional competition to worry about. That's Boca Raton.
The Sunshine State city of 100,000 people between Fort Lauderdale and West Palm Beach was once a sleepy city, but it's seeing a surge in new office development and the facilities to support it.
Boca Raton is more diverse than visitors sometimes glean from its repetitive gated residential neighborhoods and old reputation as a retirement town full of golf-cart-riding enthusiasts. The Atlantic waterfront is now crowded with luxury condominiums, restaurants, and private clubs that attract a younger clientele.
The changes are most visible in the area once known as the Golden Triangle and now called Midtown, the center of Boca's growing financial hub.
Bounded by Yamato Road to the north, Palmetto Park Road to the south, Interstate 95 to the east and St. Andrews Boulevard to the west, this commercial district is home to 38 New York Stock Exchange and Nasdaq-listed companies. is based.
Boca's 13 million square feet of office leasable space will exceed 525,000 square feet in 2023, easily surpassing Fort Lauderdale's 343,000 square feet and West Palm Beach's 126,000 square feet.
This momentum continues through 2024 with six new leases signed at the Boca Raton Innovation Campus (BRIC). The Boca Raton Innovation Campus (BRIC) is a former IBM facility just outside of Midtown that is undergoing a $100 million project to transform into a more modern office, dining and entertainment facility.
“Top-edge companies continue to flock to South Florida in search of flexible, turnkey workspaces that meet the needs of their employees,” said Michael Perrette, general manager of BRIC.
Several new office buildings planned or under construction are expected to bring millions more square feet to the market in the coming years.
Prominent among these is Midtown Place, an emerging Class A project with 120,000 square feet of state-of-the-art office space scheduled to open next year. The Butters Construction & Development project will create his first new office in southern Palm Beach County in more than a decade.
The existing building, 2 Town Center, was significantly upgraded by owner CP Group two years ago, adding Manhattan-style features such as pre-built floors and hybrid meeting space. We are proud of our unique “Restaurant Row”.
CP Managing Partner Angelo Bianco has leased more than 60% for $45 per square foot to companies including BMO Harris Bank, Prudium Group, Prudential Financial, affiliated companies and Wells Fargo Advisors. said.
Businesses are drawn to what Boca Raton Economic Development Manager Jessica Del Vecchio calls “a built-in workforce of educated, talented people.”
Mr. Del Vecchio summed up the view of some tenants in a post-pandemic world: “You can maintain a presence on Wall Street, but you can also move to an area of your choice with lower taxes.”
Boca also has a stop on the state's Bright Line, allowing Miami residents to cut their commute on congested Interstate 95 to less than an hour.
Midtown tenants enjoy proximity to the massive Town Center Mall. Home to more than half a dozen bustling department stores — Saks Fifth Avenue, Nordstrom, Neiman Marcus, Bloomingdale's and Macy's — and hundreds of upscale stores, it has helped save much of the country's brick-and-mortar retail woes.
There's also Mizner Park, a housing and shopping complex owned by Brookfield, and Boca Ice, a 73,000-square-foot facility with two NHL-sized skating and hockey rinks, which is incongruous for the subtropical climate. be.
Boca also has expanded options for tourists who want to avoid the hassles of South Beach or the exorbitant prices of West Palm Beach.
Renaissance Boca Raton, a leading hotel/resort operated by TPG Hotels & Resorts, recently underwent an extensive renovation that included a new 30,000 square foot pool deck and meeting facilities.
“We have owned and operated this property since 2006 and have experienced multiple market cycles and economic fluctuations,” said Ralph V. Izzi Jr., a spokesman for owner Procaccianti Companies. said.
“The current resurgence of Midtown Boca is surprising to say the least. Post-COVID demand for leisure and business travel and evolving consumer preferences are driving this real estate aggressively. It was a key factor in our decision to invest.”
Boca's food and beverage scene is booming everywhere.
The large outpost of the popular and acclaimed steakhouse Meat Market is not owned by Renaissance, but it is attached to the hotel and also operates a poolside cocktail and snack bar.
Meanwhile, New York restaurateur Dean Paul opened a branch of his famous Gallagher's Steakhouse last fall. He said he chose the location because it's in the middle of a “corporate hub with millions of square feet of offices.” Most of the hotels within 800 meters cater to business travelers. ”
He and his partner, Ken Langone, were confident in saying, “We created two dining areas that can be converted into private rooms.''
