Miami’s commercial real estate market has been hot for several years now, but the risks are real. The recent sale of a large office building helps illustrate the potential upside and downside.
The 30-story tower at 1111 Brickell Avenue recently sold to a joint venture involving real estate giants KKR and Parkway Property Investments for an undisclosed amount. When it last changed hands in 2013, it sold for $185 million.
Also known as Sabadell Financial Center, the building opened in 2000. It houses 8,000 square feet of retail at the ground floor level in addition to its extensive office space.
There have been several high-profile sales of commercial real estate properties in Miami’s Central Business District in recent months, including a $127 million deal for the SunTrust Financial Center. Some market analysts say that after several years of rising rents and property values, investors are anticipating slower growth ahead. They may be looking to sell their properties before that happens.
Like most investments, commercial real estate is a business where investors hope to buy low and sell high. However, in a major metropolitan downtown area, buying low is rarely an option. Rather, investors try to time the market, so they know when to get in, and when to get out while they’re still ahead. This is a high-risk endeavor, especially when the transactions involve millions, or even hundreds of millions of dollars.
A lawyer can help investors manage that risk. If you need help with commercial property transactions or in resolving real estate disputes, make sure you speak with a lawyer who has the skill and experience to work with businesses like yours.