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Fort Lauderdale office clears at $226 a foot on a 1031 bid

The 110 Tower's $89 million sale may say less about downtown office values than about the tax deferral behind the bid.

At a glance

  1. The debt moved in step: National Bank of Florida wrote a $66.25 million mortgage, about three-quarters of the purchase price, against a prior loan last modified at $90.15 million in 2019, according to the South Florida Business Journal via Connect CRE, leaving price and leverage each down $23.9 million on the same 394,057 square feet.
  2. Connect CRE describes the purchase as part of a 1031 exchange, with proceeds from another sale rolled into this one to defer tax, and that detail does more work than the headline price: a buyer whose return includes a deferral can clear a number that a buyer underwriting to current income cannot.
  3. Anyone marking downtown Fort Lauderdale office will be tempted to hang a cap rate on the $89 million: 394,057 square feet with a fitness center, a restaurant and a conference center, financed at 74% loan-to-value.

Downtown Fort Lauderdale's 110 Tower has sold to Miami-area investor Moishe Mana for $89 million, about $226 per square foot across the 30-story building's 394,057 square feet, roughly 21% below the $112.9 million the property at 110 S.E. 6th St. fetched in 2016, Connect CRE reports. That 2016 price works out to about $286 a foot, so the decade between trades re-priced the asset by the same 21%, with GEM Realty Capital the seller.

The debt moved in step: National Bank of Florida wrote a $66.25 million mortgage, about three-quarters of the purchase price, against a prior loan last modified at $90.15 million in 2019, according to the South Florida Business Journal via Connect CRE, leaving price and leverage each down $23.9 million on the same 394,057 square feet. The 2019 loan already stood above what the building has now sold for.

Connect CRE describes the purchase as part of a 1031 exchange, with proceeds from another sale rolled into this one to defer tax, and that detail does more work than the headline price: a buyer whose return includes a deferral can clear a number that a buyer underwriting to current income cannot. Whether GEM Realty Capital was also the 2016 buyer, and what basis it exited on, the report does not say.

Anyone marking downtown Fort Lauderdale office will be tempted to hang a cap rate on the $89 million: 394,057 square feet with a fitness center, a restaurant and a conference center, financed at 74% loan-to-value. This is a print, not a comp. Office price discovery now happens only where a trade actually prints, and the prints arriving are shaped as much by whichever buyer shows up — tax deferral in this case — as by rents. A 74% loan against a building that just traded 21% below its 2016 price suggests the lender is underwriting the borrower's motive as much as the building's cash flow.

Connect CRE notes Mana's largest deal so far this year was the $110 million purchase of the One Downtown office tower, which would make 110 Tower his second office buy of the year at a basis no national core fund can reach. Watch whether the next comparable Fort Lauderdale trade, with no exchange behind it, prices above or below $226 a foot. Below, and 110 Tower will have set the ceiling for downtown office here.

110 Tower: sale price and mortgage, 2016/2019 vs. 2026

Sale price and debt each fell $23.9 million

$112.9MSale price, 2016$89MSale price, 2026$90.15MMortgage, 2019$66.25MMortgage, 2026$112.9MSale price, 2016$89MSale price, 2026$90.15MMortgage, 2019$66.25MMortgage, 2026$112.9MSale price, 2016$89M$90.15M$66.25MMortgage, 2026
Source: Connect CRE · South Florida Business Journal
Show as table
LabelValue ($M)
Sale price, 2016$112.9M
Sale price, 2026$89M
Mortgage, 2019$90.15M
Mortgage, 2026$66.25M

Reported by the Deals desk from Connect CRE and South Florida Business Journal. Published . Corrections

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