Joe Sitt’s $100M plan for Pablo Escobar’s Tulum compound

Thor Equities bought "Casa Magna" for $17.5M, and envisions a trendy hotel & spa

TRD New York /
Dec.December 14, 2019 10:00 AM
The beach in Tulum, Mexico, and Thor Equities Joe Sitt (Credit: Thor Equities LLC via Bloomberg)

The beach in Tulum, Mexico, and Thor Equities Joe Sitt (Credit: Thor Equities LLC via Bloomberg)

It was Pablo Escobar who once said, “Everyone has a price, the important thing is to find out what it is.” For Joe Sitt, that price was apparently $17.5 million.

That’s how much the Thor Equities head paid to acquire a piece of a Tulum compound that once belonged to the notorious Columbian cocaine trafficker. Known as Casa Magna, the collection of three-story beach houses are currently vacant. Sitt plans to spend up to $100 million to transform the property into 40 luxury hotel rooms, with a spa and high-end shops. And just down the road, another piece of Escobar’s former estate was turned into a 71-unit hotel and art gallery by New York-based gallerist Lio Malca.

Tourism is booming in Quintana Roo, and hotels have been popping up across the region. About 10,000 new hotel rooms are under construction or planned in the next few years, with occupancy rates generally hovering around 80 percent. Hotel data firm STR recently said those numbers fell below 70 percent due to an invasion of sargassum in the sea, according to the Dallas Morning News. That hasn’t stopped developers interested in capitalizing on the trendy locale. Palladium Hotel Group, for example, is spending $280 million on a new all-inclusive resort in Costa Mujeres.

Sitt has no shortage of pricey competition already residing on the white-sand beaches. Vacationers can splurge on the Jashita Hotel, with a $12,000-a-night penthouse, or look at more affordable luxury options, such as the Be Tulum Hotel, where rooms are over $600 a night.

Though best known for its retail real estate, Sitt’s firm has been moving into other types of assets lately, including industrial and life-sciences. It already owns several luxury hotels in Mexico, notably the Ritz-Carlton in Mexico City, the Montage Los Cabos, the Thompson Playa del Carmen. [Bloomberg]James Kleimann

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