Sunday, September 24, 2023

Boca Draws Attention From Investors and FAU Receives Mega Gift

One vital sign for a city is the amount of money flowing into it. By that measure, Boca Raton is quite healthy.

Investment money, of course, comes into the city regularly. Over the last few months, however, have come new reminders about how much potential investors believe Boca Raton still contains and how much philanthropy is in the community.

Consider these examples:

East Palmetto Park Road Development

bank of america tower
Bank of America Tower at 150 East Palmetto Park Road; image courtesy of Grover Corlew

Grover Corlew, the Boca Raton-based real estate investment firm, bought two downtown office buildings at 120 and 150 East Palmetto Park Road.

The sale of the Bank of America tower—the 150 property—went through last July, for $44.6 million. The 120 East Palmetto Park Road building sold in March for $25.2 million. Troy McLellan, executive director of the Greater Boca Raton Chamber of Commerce, told me, jokingly, “I think every business in Boca Raton” has been in the Bank of America tower at some point.

This major investment comes as Boca Raton makes yet another attempt to pump up that part of downtown. Councilwoman Andrea O’Rourke devoted much of a recent workshop meeting to the effort, which includes a number of the city’s leading business figures. Company representatives want Grover Corlew to be part of the planning.

Investors don’t sink that kind of money into prominent properties just to maintain the status quo. Mark Corlew spoke at the meeting to indicate his company’s interest in the future of downtown. With Boca Raton joining other South Florida cities in recruiting out-of-state companies, Class A office space like that in Grover Corlew’s properties becomes important. The nearby proposed Aletto Square project also includes Class A space. The city is working with the owners of the Boca Raton Innovation Campus. They want to create a regional high-tech hub at the former IBM site.

In 2018, Boca Raton botched an opportunity for major reinvestment in the Midtown neighborhood east of Town Center Mall. Perhaps city council members now understand that without private investment, a city withers.

New landlord for FAU’s Research Park

Image courtesy of FAU

One of Boca Raton’s business incubators is the Research Park at Florida Atlantic University. A new landlord has taken over much of the park.

PEBB Enterprises, also based in the city, and Banyan Development bought the leasehold to seven of the 12 buildings on the roughly 70-acre site. The companies paid $37.5 million. Like Grover Corlew, these investors see increased potential.

Andrew Duffell is president of the authority that oversees the park. It owns the land that the state acquired in 1985 to create a support organization for the university. The authority’s job is to ensure that the park benefits FAU by, among other things, giving internships to students. The authority’s board includes residents of Palm Beach and Broward counties, which make up FAU’s primary service area.

Nineteen companies now are tenants. Ideally, the research park attracts startups that succeed enough to expand to private space. Perhaps the signature example is Modernizing Medicine.

Occupancy at the research park is just 65 percent. Pebb and Banyan clearly see unrealized potential. The new investors, Duffell said, “understand what an asset [the park] can be. All of this is very good news.”

A bigger Boca Raton Airport?

Because the research park is just east of Boca Raton Airport, that location is a selling point. The airport itself is getting a large infusion of money.

Atlantic Aviation, the larger of the airport’s two fixed-base operators, has signed a renegotiated 40-year lease of its 42 acres. The company plans $40 million worth of upgrades that will increase overall hangar space by 52,000 square feet. Atlantic also will renovate and repave 710,000 square feet of runway space and add 12,000 square feet of office space. Other work will renovate existing offices.

In a news release, the company said that its Boca Raton operations have more than tripled since the COVID-19 pandemic began in March 2020. Before the pandemic, the airport had opened a customs facility, which made the facility more appealing for private air travelers.

Clara Bennett, the airport’s executive director, said Atlantic Aviation’s lease is an “affirmation” of the airport’s own $40 million worth of improvements to other parts of the roughly 200-acre facility. The airport and Atlantic “redid” a lease that dated to the 1980s and needed updating. 

Bennett said Atlantic is responding to the market. General aviation aircraft are getting larger, with wider wingspans. That change is creating a need for bigger hangars. This investment will enhance the aircraft’s appeal not just to private owners but to corporations that want travel convenience.

“It’s another way,” Bennett said, “of saying that Boca Raton is a good place to do business.”

FAU receives record-breaking donation

Photo by Alex Dolce

Those three examples represent investment in buildings. FAU also just got a very large investment in people.

Ann and John Wood donated $28 million to the Schmidt College of Medicine toward tuition reimbursement for students. It’s part of a national effort to reduce the debt burden for newly graduated doctors that can be as high as $250,000. The Woods’ donation is the largest scholarship gift FAU has received. It is their third such gift to the medical school.

Dr. Julie Pilitsis is dean of the school. John Wood, she said, went to college under the post-World War II GI Bill and went on to run a large concrete company. Wood, Pilitsis said, wanted others to start careers debt-free.

Debt burden, Pilitisis said, hurts the health care industry in two ways. Some potential doctors who come from families of limited means never may even apply. Graduates with heavy debt loads may seek a high-income specialty when the biggest need, Pilitsis said, is “more primary care physicians.”

Impressive as the Woods’ donation is, Pilitisis said it gets the medical school only about 10 perent of the way toward that goal for all students after they complete four years of study. Enrollment per class will be roughly 100 in three years. “We hope that this is just the start,” Pilitsis said. “We hope other philanthropists will be inspired by this.”

Boca proposes ordinance on home businesses

On the agenda for tonight’s meeting of the Boca Raton City Council is an item concerning “home-based businesses.” Indeed, the item is to make that label official.

Until now, Boca Raton has considered businesses operating out homes to be “home occupations,” which are different from a store or office. Last year, however, the Legislature passed and Gov. DeSantis signed legislation that cities and counties opposed because it broadens the definition of a home-based business. Critics believe that it could lead to any sort of business being able to operate anywhere and represented the biggest attack yet on home rule.

Under Boca Raton’s proposed ordinance, “home-based businesses” could not sell products in that home and would get more parking than city rules allow. Homeowner association rules could take precedence over the ordinance. But such businesses now could employ two people who don’t live at the residence and use two contractors who don’t live there.

The staff, citing that 2021 law, recommends approval. It’s clearly an attempt to avoid someone suing the city. Gov. DeSantis still has not received this year’s bill that would allow businesses to sue cities over regulations that cost a company at least 15 percent of its profits.

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Randy Schultz
Randy Schultz
Randy Schultz, a native of Hartford, Connecticut, has been a South Florida journalist since 1974. He worked for The Miami Herald until 1976 and for The Palm Beach Post from 1976 until 2014, where he served as managing editor and editorial page editor. Since 2014, he has written a politics blog, commentaries and other articles for Boca magazine. His writing has earned first-place awards from the Florida Magazine Association and the Florida Society of Newspaper Editors. Randy has lived in Boca Raton with his wife, Shelley Huff-Schultz, since 1985. His son, daughter-in-law and their three children also live in Boca Raton.

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