SBR-Fortune Associates was formed by Miami-based Fortune International and Boston-based Sonesta International Hotels Corp. specifically for this $400-million project, which was announced in January. Fortune acquired the 10.6-acre parcel on which the resort operates for $60 million, which included a $30-million mortgage on the property.
Sonesta will continue to operate the existing resort through August 2006, after which Fortune will demolish it and replace it with a new 315-unit residential and hotel/condo with conference space, two restaurants, a pool, spa, fitness center and tennis courts. Sonesta will hold a 50%-interest in the newly developed property and operate it under the Sonesta banner.
Manuel de Zarraga, executive managing director in the Miami office of Holiday Fenoglio Fowler, represented SBR-Fortune Associates LLP in arranging the funding from HSBC Bank USA, working with Chris Whyte, who heads HSBC's Miami real estate group, and Mike Wadler, HSBC VP.
HFF has worked with Fortune on other projects in the area, including Jade Brickell, Jade Beach and Artech Residences, and de Zarraga says, "we have no doubt the Sonesta Beach Resort will match the world class luxury quality of all Fortune products."
Sonesta shareholders apparently agree. A day after the deal was announced shares of its stock zoomed from $8 per share to $18.50 a share and continued upward to hit a 52-week high of $42.77 a share before settling at $29.75 a share at the close of the market on May 20. As a result, Sonesta's board approved the payment of a special $1-per-share dividend that will be paid on June 10 to shareholders of record on May 23.
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