A consortium consisting of affiliates of Starwood Capital Group, the LeFrak Organization and Invesco Ltd. on Thursday announced that they have jointly purchased the South Miami Beach mixed-use hotel that was formerly known as the Gansevoort and just renamed The Perry South Beach.
The property was sold by entities controlled by Credit Suisse, which had acquired it through foreclosure in 2010. However, terms of the transaction were not disclosed.
The property, with 334 guestrooms and 255 condo units, will get a US$100 million renovation and a new brand name to reposition it in late 2013 as a premier destination in Miami Beach. The 255 luxury residential units will also be renovated and offered for sale later this year. The repositioning will also include several new local and national stores and restaurants in the retail corridor along Collins Avenue.
“This is an incredibly exciting opportunity to create a premier luxury hotel and residences along one of the world’s most beautiful and popular beaches at a time when global interest in the Miami marketplace is close to surpassing its all-time high,” said Barry Sternlicht, chairman and CEO of Starwood Capital Group, Greenwich, Connecticut. “This is a powerhouse asset with a unique beach footprint in one of the strongest hotel markets in the nation with high barriers to entry. We are excited to create an outstanding destination resort and residences in this dynamic city. Importantly, this partnership has extensive experience and a proven track record of successfully investing in and managing thousands of properties in this region.”
The asset includes 90,000 square feet of retail space, which includes a 42,000 square foot David Barton Gym, three outdoor swimming pools, and multiple indoor and outdoor food and beverage venues. The property also includes a 26,000 square foot rooftop pool and lounge with sweeping ocean views, a 32,000 square foot elevated pool plaza and restaurant, and a 48,000 square foot private beach. The property occupies the entire block between 23rd and 24th Sts. on Collins Ave. and enjoys more than 600 linear feet of beach frontage.
“This investment represents both a strategic move into the vibrant Miami market as well as an expansion of our company’s investments in the hospitality sector,” said Richard LeFrak, chairman and CEO of the LeFrak Organization, one of the nation’s largest privately held real estate development companies owned by the LeFrak family of New York.
Invesco participated in the transaction through its Invesco Mortgage Recovery Fund, a fund co-managed by its Invesco Real Estate, Invesco Fixed Income and WL Ross & Co. LLC investment centers.
Starwood Capital, LeFrak and Invesco all also participated in ST Residential, which acquired the loans and real estate owned assets formally owned by the failed Corus Bank, including more than 2,000 condominium units in Miami. The recent pace of sales of condominiums in Miami encouraged members of the consortium to pursue further investments there.
