Historic Gulfstream Hotel Trades for $13M

LAKE WORTH, FL-The historic 106-room, 81-year-old Gulfstream Hotel, a Downtown landmark, will be transformed into a condo hotel following its $13-million sale to a joint venture development group, according to principals involved in the transaction.

Ceebraid-Signal Corp. of Stamford, CT and West Palm Beach and New York-based Investcorp paid hotel owner Brett Engelhard’s Gulfstream Hotels LLC company $122,641 per room, or about $216.66 per sf, for the six-story, 60,000-sf property that is on the National Register of Historic Places and is a member of Historic Hotels of America.

Joint venture officials couldn’t be reached by GlobeSt.com’s publication deadline to learn estimated renovation and conversion costs. However, a media representative for the buyer group tells GlobeSt.com the room count will be reduced to accommodate larger suites in the planned conversion of the hotel.

“Over the next year, Ceebraid-Signal will renovate the interiors of the Gulfstream, transforming the popular Lake Worth landmark into a distinctive boutique luxury hotel and significantly enhancing the property’s value, both as a tourist destination and as a real estate asset,” Ceebraid-Signal president Adam Schlesinger says in a prepared statement. Ceebraid-Signal is partnering with Investcorp because of the New York firm’s “impressive track record and real estate investment expertise,” Schlesinger says. He says the Gulfstream Hotel “has tremendous value potential.”

The Gulfstream deal is the third joint venture between Investcorp and Ceebraid-Signal. “Our purchase of the Gulfstream Hotel, in partnership with Ceebraid-Signal, represents our continuing success in finding investment opportunities with strong potential across the country,” Investcorp principal Brad Seiden says in the same statement.

The partners agree the hotel’s proximity to the affluent Palm Beach markets was a key factor in the joint venture’s decision to buy the hotel. The hotel is adjacent to the Intracoastal Waterway; a half mile from the beach and the Lake Worth pier; seven miles from fashionable Worth Avenue in Palm Beach; six miles from Palm Beach International Airport; and seven miles from Downtown West Palm Beach.

Real estate sources in a position to know tell GlobeSt.com the joint venture will be following the hotel condo conversion plan Ceebraid-Signal used after purchasing the Brazilian Court in Palm Beach in 2002 for $18 million. Ceebraid-Signal is recognized as one of South Florida’s leading condo converters, area brokers tell GlobeSt.com. Nationally, the company says it has converted or repositioned about 25,000 multifamily units

According to Palm Beach County real estate records, Gulfstream Hotels LLC bought the hotel from a Pittsburgh real estate firm in 2003 for $6.1 million. The Pittsburgh firm purchased the hotel in 1996 for $2.4 million after the property went through several owners and a bankruptcy court issue.

According to local historians, the hotel opened in 1925 but was forced to close in 1928 following a hurricane that filled the lobby with sand. The hotel continued to have financial problems and in 1936 was sold at auction for $60,000.