A Dallas-based real estate developer has acquired Office Depot’s sprawling Delray Beach headquarters for $80 million. Lincoln Property Co. sealed its deal for the three-building, 43-acre campus – on Congress Avenue just south of Linton Boulevard – on Dec. 22.
Office Depot will lease back its 566,852-square-foot headquarters until the end of 2008, when its new $210 million headquarters is expected to open in Boca Raton.
Lincoln plans to upgrade Office Depot’s existing trio of buildings – the newest built in the mid-1990s – and market them as multi-tenant offices for lease, according to Lincoln’s South Florida-based senior VP, Steven Medwin.
Lincoln also is considering developing as many as 1,200 residential units and 250,000 square feet of retail in a village-like design. This proposal comes less than a month after the Delray Beach City Commission voted to create a new zoning overlay district to encourage denser urban redevelopment in the area.
The overlay, which runs along Congress Avenue south of Atlantic Avenue to the Boca Raton line, allows for a mix of uses, including high-density residential. Developers are required to set aside 20 percent of the units as workforce housing. In return, they can build as many as 50 units for each acre of land and develop buildings as high as 85 feet, which is about eight stories.
“We were originally acquiring it for office product,” Medwin said. The new zoning “was just a nice benefit to the site.”
In addition to the buildings, the site, located a few traffic lights north of Boca Raton, comes with 8.75 acres of vacant land.
Lincoln is buying and developing the Office Depot site in partnership with Morgan Stanley Real Estate.
Lincoln’s first venture in county
The project is Lincoln’s first in Palm Beach County. The 42-year-old firm owns and manages more than 1 million square feet in Broward and Miami-Dade counties.
Delray Beach Mayor Jeff Perlman, who has expressed dismay over losing Office Depot’s 1,723 jobs to Boca Raton, said Lincoln’s project would help launch redevelopment of the city’s south end, now a mix of low-rise strip centers, offices and government facilities.
“They are the type of operator we were looking to attract. I think this is going to mean a lot of economic benefit for the city,” Perlman said. “You have your eggs in one basket when you have one large corporation. If you can bring in many smaller corporations and have multiple employers, you are not so reliant on one corporation.”
SOURCE: Business Journal