Marking its first foray into South Florida, a publicly-traded Israeli company with major holdings in New York — in a joint venture with a Turkish conglomerate — has signed a contract to buy an oceanfront building in Surfside, with plans to build an ultra-high end hotel and condos, The Real Deal has learned.
Israel-based ASRR Capital, controlled by Alex Sapir and Rotem Rosen, and the Istanbul-based Suzer Group, have agreed to pay $40 million to 41 condo owners and the condo board, at 8955 Collins Avenue, in an off-market transaction, Rosen told TRD.
The deal includes the nearly one-acre property on the ocean, next to the Surf Club Four Seasons Hotel & Private Residences, which was designed by Richard Meier and Kobi Karp, is currently under construction, as well as a property on the west side of Collins Avenue, he said.
“We were lucky enough to negotiate with each of the tenants in the building and get their approval, so all will move 30 days after closing,” Rosen said. The purchase is expected to be completed in 45 days. “So we are planning demolition in September and starting the foundation in December,” said Rosen, whose group handles real estate development, construction and management.
In Manhattan, the Sapir Organization owns 6.5 million square feet of real estate, including the New York headquarters for Coca Cola, Sony, Credit Suisse, William Morris and MTA. ASRR Capital and the founder of Buddha Bar, Gerard Guez, just bought the Mondrian SoHo which was changed today to the NoMo Soho. Sapir Organization also owns 260 Madison Avenue and 261 Madison Avenue, and is partners in Zuma in New York, which is expected to generate $45 million in revenue this year, principal Arjun Waney recently told TRD.
“After many years of living in Miami, I feel that it is the right time to enter the market,” said Sapir, ASRR’s chairman, who splits his time between Miami and New York, in a statement, “as Miami has became a place to live and for vacation.”
The Suzer Group, which is involved in real estate, banking and energy in Turkey, and owns the Ritz-Carlton in Istanbul, made its first U.S. purchase in New York two months ago. In a 50/50 partnership with ASSR Capital, the group bought 218 Madison Avenue, where they plan a high-end condo project, designed by BKSK.
“Our first deal with the Turkish conglomerate was supposed to be in Miami, but we lost the deal,” Rosen said. “We were the highest bidder for the Setai building, at $88 million, but it was sold to the Nakash family, so this is our first deal in Miami.”
For the Surfside property, Rosen said the group is looking to bring in a “very high-end brand, comparable to a seven-star hotel,” from Europe.
“There are three top brands that are looking to enter into Bal Harbour and Surfside,” he said, “and because of lack of product there is a big competition. That is why we are there and we very much believe in the place.”
The investors’ plan is to build an 80-room hotel with a beach club that would be a continuation of the Surf Club Four Seasons’ beach club. Ten luxury condos would top the new building, which is currently zoned for 12 stories, Rosen said. The building will have 150,000 square feet when it is completed in about two-and-a-half years. On the other side of Collins Avenue, the investors plan to put a parking lot, and on top of that, a tennis court, he said.
“Practically, we view Miami as a continuation of New York,” Rosen said. “We are planning to do more things over there in the future. But there is nothing better than to get into Miami with the high-end product we are putting together.”
Today, South Florida has become a magnet for New Yorkers, lured by the weather as well as the lack of Florida state taxes, he said.
“A place like Bal Harbour and Surfside make all the sense in the world for the more established families that are looking for a quality of life, and for tourists that are looking for luxury shopping at Bal Harbour [Shops] and all the restaurants in the area,” Rosen said. “The big thing for us is to enter this market and to do something very unique just like we are doing here in New York City.”