Michael Dell’s, MSD Capital is buying 1 Hotel South Beach for about $500 million
September 25, 2018Hospitality News: Billionaire Michael Dell’s MSD Capital is buying 1 Hotel South Beach for about $500 million, or more than $1 million per key.
Starwood Capital Group, led by Barry Sternlicht, is selling the beachfront 426-key hotel at 2341 Collins Avenue for about $1.2 million a room, according to the Commercial Observer. The deal, which is reportedly in contract, would set a record for hotel sales in Miami, beating out the $1 million per key (or $325 million sale) of the Ritz-Carlton Key Biscayne in 2015.
The “eco-luxury” hotel hit the market about two years ago along with Sternlicht’s 1 Hotel Central Park and 1 Hotel Brooklyn Bridge. OpenComps, a website that tracks commercial real estate deals, reported the $500 million price of the Miami Beach property, citing the Commercial Observer.
The buyer, MSD Capital, is a private investment firm that manages Dell and his family’s assets. Dell, chairman and CEO of Dell Technologies, is worth about $28 billion, according to Forbes. Most of his fortune is in the investment firm, which has offices in West Palm Beach, New York and Santa Monica, Forbes reported.
Sternlicht redeveloped the former Gansevoort Hotel property into 1 Hotel & Homes with joint venture partner LeFrak. The hotel, which opened in 2015, features three restaurants, four outdoor swimming pools, 57 cabanas and daybeds and an 18,000-square-foot gym and spa. Property records show affiliates of Starwood, LeFrak and Invesco acquired the property in 2012.
Other top hotel sales in South Florida in recent years include Thayer Lodging Group’s $460 million purchase of Hollywood’s Westin Diplomat Resort in 2014, which broke down to about $461,000 per room.
Brookfield Asset Management is also reportedly under contract to buy the PGA National Resort & Spa in Palm Beach Gardens for $255 million, or about $752,000 per key.
Source Credit: Commercial Observer , The Real Deal South Florida