The Miami Gardens office cycle: $6.1M to $13.75M in 36 months.

A complete deal memo on a Class B office property we acquired for an investor in 2019 at $6,100,000 — a distressed acquisition at approximately 60% occupancy, on the precipice of COVID. After a 10% tenant loss in the first 120 days, $1.4M in capital improvements, and a repositioning that pushed in-place rents nearly 20% above perceived market, we represented the same investor in the disposition at $13,750,000 in 2022. Approximately 25% return on investment for the seller. The buy-side underwriting set the floor. The operational execution did the rest.

The asset.

A Class B office property in Miami Gardens, Florida. Approximately 76,000 square feet of leasable area on a single parcel, with a tenant roster of regional office users — the kind of building that does not appear in institutional pitch decks but, with the right operating discipline, generates the kind of in-place yield and rent reversion that institutional capital pays a premium for at exit.

At acquisition, the asset was operationally challenged. Occupancy stood at approximately 60%. The improvement standard was dated. The previous owner had been hands-off, and the leasing program had drifted. Most prospective buyers looked at the rent roll and walked. The right way to read the same rent roll was as a price.

The acquisition.

We represented the buyer in the 2019 acquisition. The $6,100,000 price reflected a distressed seller, sub-market occupancy, and the absence of competing institutional bids. Most importantly, it reflected an entry basis low enough to absorb the capital, vacancy, and time required to reposition the asset — even under adverse scenarios.

The buy-side underwriting focused on three variables.

The entry basis. At ~$80 per square foot for a 76,000 SF Class B office building in a stabilizing South Florida submarket, the dollars-per-foot math worked even at flat occupancy. Any operational improvement was upside.

The capital requirement. We modeled approximately $1.4M in repositioning capital — common-area improvements, suite refresh, exterior work, and tenant improvement allowances to support the lease-up. The combined basis at $7.5M total invested left meaningful room before approaching market replacement cost for comparable assets.

The rent reversion case. Submarket rents were under-priced relative to product quality. We modeled a base case at $20.00 per square foot — roughly the in-place rate at acquisition — and an upside case at $23.50, contingent on the capital plan and the leasing program both executing. The exit thesis was anchored to the base case, not the upside.

The hold.

The hold tested every assumption.

Within 120 days of closing, the asset lost a tenant representing approximately 10% of the building. Occupancy moved from a challenged starting point to a more challenged one. Then COVID arrived. The repositioning timeline that had been planned around a stable market suddenly intersected with an office sector facing the most severe demand disruption in a generation.

The investor committed to the underwritten plan. The $1.4M capital improvement program proceeded — common-area renovations, suite refresh, exterior work, and a tenant improvement reserve to support new leasing. Verterra Property Management, our affiliated firm, was engaged for both day-to-day asset management and the leasing program. Having a single integrated operator handle both functions was material: the leasing team had real-time visibility into operational issues that affected showings, and the management team had aligned incentives with the lease-up timeline.

The lease-up worked. Over the balance of the hold, occupancy moved from approximately 60% at acquisition to 88% at disposition — a 28-point improvement, executed during the most disrupted office leasing environment in decades. More notably, the asking and achieved rents moved from approximately $20.00 to $23.50 per square foot, a 17.5% increase, and roughly 20% above the perceived market rate at the time. The capital plan combined with disciplined leasing produced a building that comparable Class B inventory in the submarket could not match.

The disposition.

By early 2022, the asset presented a clean institutional story: documented occupancy lift, achieved rents above market, a credible operating history, and a tenant roster that would survive due diligence. The decision to exit was driven by the spread between achieved cap rate and the underwritten exit, not by external pressure.

We represented the seller. The marketing approach was the inverse of a public listing — targeted outreach to a small set of institutional and family-office buyers whose acquisition mandates aligned with the asset profile and the documented value-creation story. The process was confidential through letter of intent.

The transaction closed at $13,750,000 — a 6.25% capitalization rate against in-place income, and approximately 25% return on the seller's invested capital over the 36-month hold.

What this trade signals.

Three takeaways from the cycle, all of which apply to assets we are working on today.

• The entry price is the floor for every return that follows. A distressed acquisition at ~60% occupancy, on the precipice of COVID, is a story most buyers would not have underwritten favorably. The underwriting that mattered was not optimistic — it was disciplined enough that even the worst-case hold (the early tenant loss, the COVID disruption) did not break the deal.
• Capital and operations have to be the same plan. The $1.4M capital improvement program would not have produced the rent push without the leasing program executing in parallel. The leasing program would not have produced the rent push without the capital improvements making the product competitive. The reason the lease-up worked under COVID conditions is that capital and operations were a single integrated effort — through Verterra, our affiliated property management firm.
• The brokerage-plus-management integration is the actual value. The buy-side underwriting set the entry basis. Verterra ran the asset day-to-day and led the leasing program through the most disruptive office environment in decades. The sell-side marketing surfaced the right buyer at the right price. The same firm, or its affiliate, was present at every step. That continuity is not a coincidence — it is the operating model.

Where we are now.

As of 2026, Chandler & Co. is again representing the buyer in an active transaction at the same Miami Gardens property. The deal is currently under contract and in due diligence. Detail will be expanded upon close.

The continuing relationship — buy in 2019, sell in 2022, buy again in 2026 — is the kind of multi-cycle engagement that defines what the firm is built to do.

Authored by the Chandler & Co. team. Names of the principal investor and counterparty are withheld at the parties’ preference. This memo is published for educational purposes and does not constitute investment advice. Past performance is not indicative of future results. All numerical figures cited are accurate to closing settlement statements.