In West Palm Beach Real Estate, a Sense of Being on the Cusp

West Palm Beach’s transformation is only getting started. 

That was the consensus at Commercial Observer’s Executive Leadership Reception held the evening of April 16 at the Related Ross Experience Center on South Rosemary Avenue in West Palm Beach, Fla.

After introductory remarks from CO Deputy Editor Tom Acitelli, attorney David Scharf of Morrison Cohen moderated a panel between Tony Fineman, Acore Capital’s senior managing director and head of originations, and Jordan Rathlev, an executive vice president at Related Ross, which was followed by an awards ceremony.

Since launching Related Ross in 2024, Stephen Ross has plunged headfirst into transforming West Palm Beach from a seasonal vacation city into a hub for cutting-edge industry. J.P. Morgan, Goldman Sachs, Elliott Management, Point72 Asset Management and Millennium Management have already signed onto Related Ross buildings. 

Earlier this year, Wells Fargo inked a 55,000-square-foot lease at One Flagler to relocate its wealth division from San Francisco. (The 25-story tower, designed by the late David Childs, won the evening’s Office Development of the Year award.) 

More lease announcements should be on the way. About 100 banks have expressed interest in taking space at 10 CityPlace and 15 CityPlace developments, Rathlev divulged. These organizations “probably never would have thought about West Palm Beach five or 10 years ago, but the momentum has come here,” the executive said. 

Last year, the 1 million-square-foot development scored a $772 million construction debt package, which won the Financing of the Year award. David Gahagan, Northmarq’s managing director, presented the award to David Proctor and Bryan Donohoe, who accepted the honor on behalf of lender Ares Management.

The demand that Related Ross is generating has boosted other properties, including 300 Banyan, the only new Class A office building in West Palm Beach not owned by Related Ross. ACORE Capital provided construction debt. 

“We underwrote probably $40 to $50 in rents — we thought we were being a little bit pioneering,” Fineman said. “They’re topping $85 to $90 a square foot today.”

The change in West Palm Beach has been stark, Fineman added. “We had to have an office across the bridge on the other side in Palm Beach because the people in Palm Beach wouldn’t come over. The city was the armpit of South Florida.”

Related Ross is building out not only the required offices for these high-flying companies, but also condos, schools and retail space to ensure a smooth transition for executives and their families. 

“Once the company gets here, you have to build out the entire environment,” Rathlev said. “Paramount is making sure the employees want to be here.”

Other developers are taking notes, including Chris Schlank and Nick Bienstock’s Savanna, whose Olara project won Condo Development of the Year. 

Momentum is also building in mixed-use development, with projects like the Nora District, where a Balthazar French bistro is slated to open. The development district — and its sponsors Ned Grace, Sam Grace and Damien Barr of NDT Development; Joe Furst and Giancarlo Sainato of Place Projects; and Claude Chandonnet of Wheelock Capital — won the Mixed-Use Development of the Year award.

The migration to West Palm Beach could continue, if New York lawmakers pass legislation that’s antagonistic to business interest. “I just flew in from New York, where our governor is proposing a tax on second homes worth more than $5 million,” Scharf said. “The regulatory environment is driving people down here.” 

Don’t count out California, Rathlev added: “In California, nobody knows what Florida is. This is still kind of a foreign territory. So this will be an ongoing awareness campaign as we get in front of companies. You’re seeing some of those first movers. Hopefully by the end of this year, you’ll hear some other blue-chip names.”

Julia Echikson can be reached at jechikson@commercialobserver.com.