Steve Ross Scores Largest Construction Loan Ever in SFL at $772M

Key Points

• Record Financing Milestone: $772M construction loan, South Florida's largest ever, underscores strong capital flow into growing markets like West Palm Beach.
• Pre-Leased Anchors Drive Stability: Key tenants including ServiceNow and Cleveland Clinic ensure high occupancy, reducing risk for similar office ventures.
• City Transformation Potential: Positions West Palm as a finance and tech hub, spilling over to boost demand for multifamily and mixed-use properties.

Billionaire developer Stephen Ross, via Related Ross, has secured a monumental $772 million construction loan for two premier office towers in West Palm Beach, marking a pivotal step in reimagining the city as a financial and tech powerhouse. This deal not only sets a new benchmark for South Florida financing but highlights opportunities for investors eyeing the region's evolving commercial real estate landscape.

Project Overview

The loan funds 10 CityPlace, a 23-story, 470,000-square-foot tower designed by Kohn Pedersen Fox, and 15 CityPlace, a 26-story, 490,000-square-foot structure by Arquitectonica with Fogerty Finger interiors. Located within the CityPlace mixed-use complex on the site of a former AMC theater and restaurant, these Class A offices aim to attract high-profile tenants with modern amenities and strategic positioning.

Financing Breakdown and Timeline

Led by Ares Real Estate Funds (under Ares Management) with participation from Monarch Alternative Capital and HPS Investment Partners, this $772 million package eclipses prior records like Whitman Family Development's $740 million for Bal Harbour Shops. Construction kicked off in March 2025, with delivery slated for 2027—offering a clear horizon for investors tracking build-to-suit trends in secondary markets.

Tenant Momentum and Market Positioning

Pre-leasing is robust: ServiceNow anchors 10 CityPlace with an innovation hub and AI institute, while 15 CityPlace features Cleveland Clinic's 120,000-square-foot outpatient center (including surgery and concierge services, linked to a planned 150-bed hospital), plus firms like BDO, Shutts & Bowen, and Inclenberg Investments. This early commitment reflects Ross's New York network leverage amid post-pandemic office slowdowns, ensuring steady cash flows from day one.

Why This Matters for Investors / Landlords

For multifamily landlords and CRE investors, this development signals spillover benefits: A influx of tech and finance professionals could spike housing demand, elevating rents and values in nearby residential assets. With West Palm's office vacancy rates potentially tightening, mixed-use strategies—like integrating retail or apartments—become more viable, offering diversified income streams. Investors should scout adjacent sites for value-add plays, as Ross's $772M vote of confidence may attract more capital, compressing cap rates and accelerating appreciation in the broader Palm Beach County market.

In summary, Ross's landmark loan not only cements West Palm's ascent but opens strategic doors for landlords to capitalize on the ripple effects—positioning savvy investors for outsized returns in this burgeoning hub.