Michael Dell’s MSD Capital buying 1 Hotel South Beach for more than $500M

Deal would set a record in South Florida on a per-key basis at at least $1.2M a room

Miami /
Sep.September 25, 2018 11:36 AM

1 Hotel South Beach, Barry Sternlicht and Michael Dell

Billionaire Michael Dell’s MSD Capital is buying 1 Hotel South Beach for about $500 million, or more than $1 million per key.

Starwood Capital Group, led by Barry Sternlicht, is selling the beachfront 426-key hotel at 2341 Collins Avenue for about $1.2 million a room, according to the Commercial Observer. The deal, which is reportedly in contract, would set a record for hotel sales in Miami, beating out the $1 million per key (or $325 million sale) of the Ritz-Carlton Key Biscayne in 2015.

Hodges Ward Elliott is the listing broker, sources said. The “eco-luxury” hotel hit the market about two years ago along with Sternlicht’s 1 Hotel Central Park and 1 Hotel Brooklyn Bridge.  OpenComps, a website that tracks commercial real estate deals, reported the $500 million price of the Miami Beach property, citing the Commercial Observer.

The buyer, MSD Capital, is a private investment firm that manages Dell and his family’s assets. Dell, chairman and CEO of Dell Technologies, is worth about $28 billion, according to Forbes. Most of his fortune is in the investment firm, which has offices in West Palm Beach, New York and Santa Monica, Forbes reported.

Sternlicht redeveloped the former Gansevoort Hotel property into 1 Hotel & Homes with joint venture partner LeFrak. The hotel, which opened in 2015, features three restaurants, four outdoor swimming pools, 57 cabanas and daybeds and an 18,000-square-foot gym and spa. Property records show affiliates of Starwood, LeFrak and Invesco acquired the property in 2012.

Spokespersons for MSD Capital, Sternlicht and Hodges Ward Elliott declined to comment.

Other top hotel sales in South Florida in recent years include Thayer Lodging Group’s $460 million purchase of Hollywood’s Westin Diplomat Resort in 2014, which broke down to about $461,000 per room.

Brookfield Asset Management is also reportedly under contract to buy the PGA National Resort & Spa in Palm Beach Gardens for $255 million, or about $752,000 per key. [CO] – Katherine Kallergis


Related Articles

arrow_forward_ios
Simon and David Reuben with St. Regis Bal Harbour (Getty, Google Maps)

Reuben Brothers takes over $132M loan backing St. Regis Bal Harbour

Reuben Brothers takes over $132M loan backing St. Regis Bal Harbour
Tudor House Art Deco and Essex House hotels (Wikipedia Commons)

Hotel height increases could be coming to Miami Beach’s Collins Avenue near Ocean Drive

Hotel height increases could be coming to Miami Beach’s Collins Avenue near Ocean Drive
Diego Lowenstein, Dayssi Olarte de Kanavos, Paul Kanavos, and Ronny Ben Josef, with The The Sagamore (Credit: The Sagamore Hotel)

Owners of Ritz-Carlton South Beach and Bal Harbour hotels merge with Sagamore

Owners of Ritz-Carlton South Beach and Bal Harbour hotels merge with Sagamore
Pharrell, Eric Birnbaum and David Grutman with a rendering of the hotel (Getty, Linkedin, Goodtime Hotel)

Pharrell, David Grutman partner with developer to launch South Beach hotel

Pharrell, David Grutman partner with developer to launch South Beach hotel
Starwood CEO Barry Sternlicht, InTown Suites CEO Ash Kapur and 1071 NE 28th Avenue in Homestead (Getty, Google Maps)

Starwood scores $265M refi for portfolio of InTown, Uptown hotels

Starwood scores $265M refi for portfolio of InTown, Uptown hotels
Lord Balfour Hotel

Mezz lender forecloses on Ocean Drive hotel in South Beach

Mezz lender forecloses on Ocean Drive hotel in South Beach
Domio Wynwood, Gustavo Miculitzki, and Jon Paul Pérez (Credit: Alberto Tamargo/Getty Images)

Related lists Domio Wynwood apartment-hotel for sale with whisper price of $90M

Related lists Domio Wynwood apartment-hotel for sale with whisper price of $90M
Jeffrey Soffer and Fontainebleau Miami Beach (Getty)

Fontainebleau Miami Beach’s $1B loan exits special servicing

Fontainebleau Miami Beach’s $1B loan exits special servicing
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...