In an unusually rich real estate deal, a 9,932-square-foot building on Worth Avenue sold this week for $28.1 million — a whopping $2,800 a square foot.
“That’s a big number, even for Palm Beach,” said commercial real estate analyst Dan Fasulo, managing director of Real Capital Analytics in New York.
The one-story building at 225 Worth Ave. is leased to Brooks Brothers, which has a 6,000-square-foot store, and Juicy Couture, which occupies 4,000 square feet.
No deed had been recorded as of Friday afternoon, but Love Realty Group of New York on Wednesday bought the property from PA Florida Associates, said real estate broker Casey Rosen, senior vice president at CBRE. Love Realty Group is run by Burt Handelsman, who owns a number of properties in Palm Beach, including 256 Worth Ave., home to Gucci.
The success of luxury retailers has landlords vying for prime properties along such swanky “high street” shopping stretches as Fifth Avenue, Michigan Avenue, Rodeo Drive and Worth Avenue, said Fasulo and Rosen.
“They’re not making more high street space,” Rosen said. “Palm Beach tends to be an extremely difficult place to build.”
The big sale price begs the question of whether Brooks Brothers and Juicy Couture will be willing to pay higher rents when their leases run out.
“It’s very possible that you’re going to see new tenants there,” Rosen said.
It’s not the first time 225 Worth Ave. has fetched an eye-popping sum. The building last sold in 1990 for $13.55 million. At the time, real estate analyst Charles Kimball called it the highest price per square foot ever paid for South Florida retail space.
However, 225 Worth Ave. didn’t exactly skyrocket in value over the past 23 years. The doubling of its price represents annual appreciation of only 3 percent.