Real Estate Forum - April 2012

International tenants have also helped 1450 Brickell reach 77% occupancy in just 21 months on the market during one of the worst commercial real estate environments that Downtown Miami has ever experienced. International tenants include global reinsurer Swiss Re America Holding Corp., London-based insurance provider Catlin Insurance Co. and Spanish banking institution BBVA Compass.

“Miami has become an urban city that is attractive because of its
globalization, infrastructure and amenities,” says Tere Blanca,
president and CEO of Blanca Commercial Real Estate. “Miami is
still the most comfortable and secure environment for any com-
pany in the world that wants to be active in Latin American and
Caribbean economies, including European companies looking to
enter new growth markets.”
Beyond Downtown Miami, 396 Alhambra Circle is getting a mul-
tinational tenant boost as the two-tower class A office and retail
complex approaches 50% occupancy. In late December 2011,
HBO Latin America signed on for three full floors of the 15-story
North Tower and two adjoining full floors of the seven-story South
Tower. International architecture firm RTKL and Madrid-based
multinational Internet company Terra Networks are also among
the project’s newest tenants.

SURE THINGS AND RISKY BETS

But those with capital aren’t looking for just any investment opportunity. They’re generally looking for safety—be it in trophy assets or net-leased properties. Others are trading in safety for opportunities to get higher yields.

“Many foreign investors are looking at trophy properties because

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they want safety,” says Ross Manella, a real estate attorney at
Hinshaw & Culbertson. “They want a property that will not be sub-
ject to the vagaries of a recession. I’ve done transactions where my
clients have been one of 40 bidders. There are many cash buyers
chasing the same marquee assets. But it’s a bifurcated market.
There’s not much going on at the low end.”
Calkain Cos. just set up an office in Ft. Lauderdale to comple-
ment its Tampa office. The Reston, VA-based triple-net lease spe-
cialist is also responding to demand from internationals for safe
investments on marquee properties. Patrick Nutt, managing direc-
tor of the new office, says international players see net-leased prop-
erty as an easy, passive way to maintain an investment in the US.
“We’ve seen a significant uptick in dollars coming from companies
in Colombia and Venezuela in the past couple of years,” he says.
“They still look at the US as a safe haven.”
Espacio USA, the American arm of Madrid-based real estate
firm Inmobiliaria Espacio, snapped up 1400 Biscayne Center
nearly two years ago. The mixed-use office and retail complex in
Downtown Miami offers a dramatic turnaround story. Espacio
came in with about $1.5 million in tenant improvements to spark
new interest in the complex. In less than two years, it’s brought
occupancy from 11% to 70%.

“Miami has a very powerful future,” says Maribel Goldar, direc-
tor of leasing and marketing for Espacio USA. “The opportunities
right now in Spain are not good. Miami has development opportu-
nities, so it’s a must for us to be here.”
On the other end are distressed assets, which are still in the
picture here. According to Real Capital Analytics, South Florida