BOCA RATON, FL—As Palm Beach County's office market startsgaining more traction, 595 Financial Center has traded hands.Pinnacle Holdings acquired the office portfoliofor $33 million.

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Avison Young principal Keith O'Donnell andassociate Jonathan Senn represented Pinnacle infulfilling a 1031 Exchange requirement.Charles Shane, president of BryasonRealty, represented the seller.

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“Due to the time constraints of investment requirements,1031 buyers typically prefer off-markettransactions in order to avoid the auction bid process,” saysO'Donnell. “With a strong corporate tenancy anchored byMorgan Stanley and top-tier building amenities,595 Financial Center is one of the premier office buildings in BocaRaton, and represents an excellent long-term investment for ourclient.”

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The two-building class A office portfolio spans116,000 square feet. It sits at 555 & 595 South Federal Highwayin Boca Raton, FL in the heart of Boca Raton's business district.It's also near shops, dining, Mizner park and several newresidential projects and overlooks the Boca Raton Resort and GolfCourse.

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“Property performance and investment activity in South Florida'soffice sector is heating up across the board,” says Senn. “In theDowntown Boca Raton submarket, rents have increased over 6% in thelast 12 months and Pinnacle's timing could not be better to takeadvantage of this upswing.”

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Indeed, the economic rebound of the last three years hasvalidated the attractiveness South Florida has for domestic andinternational investors. Nearly all real estate sectors havestabilized and prospered, setting the stage for investors to takemoney that was sitting on the sidelines and bet on profitableassets in the area.

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Brad Capas, president ofCapasGroup, tells GlobeSt.com the performance andfundamentals are also strong a little further north in Palm BeachCounty. He points to the three true class A buildings in DowntownWest Palm Beach are now 95% occupied so new tenants seeking largeblocks of class A space are being turned away.

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“If a new building were available, sufficient demand exists tosecure at least one or two new market entrants with sizable officespace requirements,” Capas says. “Additional preleasing activitywould be driven by tenants relocating locally from other olderclass A and B buildings as several hundred thousand square feet ofexisting office leases in around the urban core are scheduled toexpire during the next five years.”

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