A new zoning district incentivized for “Class A” office has been proposed in part of downtown West Palm Beach, which would aid the Related Cos.’ effort to build a 25-story office tower there.
According to data cited by city officials from brokerage JLL, the “Class A” office buildings downtown have a vacancy rate of just 5 percent. City efforts to recruit major corporate tenants downtown have fallen short because of the lack of available office space, including a hospital company that relocated to Boca Raton instead, the city memo said.
There is no major office building under construction in downtown West Palm Beach now, although several projects have been approved over the past two years.
In early 2016, New York-based the Related Cos., headed by billionaire Miami Dolphins owner Stephen M. Ross, approached the city with plans to build a 30-story “Class A” office tower called One Flagler. Located along the Intracoastal Waterway at 809 S. Flagler Drive, it would rise next to the First Church of Christ Science. Related Cos. tapped architect David M. Childs, who designed One World Trade Center, for this project.
The 30-story plan for One Flagler was not approved by the city, as the site is currently limited to five stories. However, now it could be part of a larger area of downtown rezoned to encourage office development.
On July 26, the city’s Planning Board will consider the city-initiated request to create the Okeechobee Business District (OBD). It would allow height of up to 25 stories and increased floor-area-ratio for buildings with more than 250,000 square feet of “Class A” office space. The developers would have to meet certain criteria to earn the extra density, such as dedicating public space, having larger setbacks from the street, building LEED certified, having a mobility plan, and purchasing transfer of development rights from pre-designated historical properties.
This would apply for all property between Okeechobee Boulevard, Lakeview Avenue, Flagler Drive and Rosemary Avenue. This includes the planned site of One Flagler. This measure would include city approval at a later date.
Shutts & Bowen attorney Harvey Oyer III, who represents Related Cos., said the OBD would fix what is a disjointed area for zoning. While his client’s property is limited to five stories, sites a few blocks over are allowed much greater height and density, and the CityPlace site has virtually no limit on project scale.
“It creates inconsistent development patterns and violates the planning principals of consistency and equality,” Oyer said.
The Related Cos.’s new plan for One Flagler is a 25-story building with 275,000 square feet of “Class A” office space. In order to comply with the proposed OBD, the developer would provide 1.25 acres of public green space at no cost to the city, a 300-foot setback from Flagler Drive, and it would designate the adjoining church as historic to preserve it, he said.
While other office buildings that were approved downtown have yet to begin construction, Oyer is confident that the Related Cos. would move forward quickly with One Flagler upon obtaining approval. The other office projects were located well off Okeechobee Boulevard, where the three existing “Class A” office building are near.
“The financial hub of the city is the Okeechobee corridor,” Oyer said. “These firms tend to cluster near each other. Its close to the heart of Palm Beach, connects to I-95 and the Turnpike and is five minutes to an international airport. If you are a corporate executive or a hedge fund owner and have home in Palm Beach and a plane sitting at PBI, this seems to be the location you want.”
Publication: South Florida Business Journal
Author: Brian Bendell