W Brand Creator Behind Group Acquiring Premier South Beach Hotel

MIAMI—A group of Starwood Capital affiliates, the LeFrak Organization and Invesco have teamed up to purchase one of South Beach’s premier luxury mixed-use properties, including a hotel formally known as the Gansevoort. The property includes 334 hotel rooms, 255 condo units and 90,000 square feet of retail space, as well as three outdoor swimming pools, and multiple indoor and outdoor food and beverage venues.

Entities controlled by Credit Suisse sold the asset, which it acquired through a foreclosure in 2010. Jones Lang LaSalle Hotels represented the seller of the property, which takes up the entire block between 23rd and 24th streets on Collins Avenue and boasts more than 600 linear feet of beach frontage. Financial terms of the transaction were not disclosed.

“This deal was incredibly complex, due to the building’s size and scope of ownership, with nearly two million square feet owned by four major entities along with a shared facility space,” Carter McDowell, partner at Bilzin Sumberg and attorney representing the buyer of the deal, tells GlobeSt.com. “Now under strong ownership, this trophy asset has the potential to be repositioned as among South Florida’s premier oceanfront properties.”

The consortium is planning to invest more than $100 million to renovate the property. The hotel gets a new name, Perry South Beach, and will relaunch in late 2013. The consortium plans to sell the condos, which have full access to hotel services and amenities, later this year.

Barry Sternlicht, the chairman and CEO of Starwood Capital Group, called the deal an 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. Sternlicht created the W and St. Regis Hotel brands.

“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,” Sternlicht said in a statement. “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.”