UPDATED, Nov. 5, 10:10 p.m.: A Bay Harbor Islands-based hotel development and investment firm is making a $10 million bet in its own backyard.
Finvarb Group, led by Ronny Finvarb, bought The Landon Bay Harbor-Miami Beach at 9650 East Bay Harbor Drive, The Real Deal has learned. The seller is BHI Hotel, an entity managed by Samuel Spiritos, a managing shareholder with Shulman Rogers, a law firm in Potomac, Maryland.
Finvarb Group paid roughly $219,022 per room for the two-story, 46-key boutique hotel built in 1946. In 2007, BHI Hotel paid $3.9 million, or $84,783 per room, according to records. The 22,729-square-foot building also has a ground-floor commercial space net leased to The Palm-Miami restaurant.
“We are very pleased to add this new hotel and restaurant to our portfolio, especially since it’s literally in our backyard,” Ronny Finvarb said via text. “The Palm restaurant has been a neighborhood staple for decades, and we plan to activate and elevate the rest of the property to another level.”
The property was listed in February by David Cohen and Arthur Porosoff with Compass, and David Greenberg with Marcus & Millichap. Cohen said the seller received five offers.
“It just turned out that Finvarb Group is a strong buyer in the marketplace,” Cohen said. “And the company’s ability to execute was one of the factors in selecting it as the buyer.”
The hotel was renovated in 2010 and The Palm-Miami currently pays $300,000 in annual rent or 6 percent of its gross sales, whichever is greater, according to the investment offering.
The Landon had a net operating income of $305,901 for the 12 months ended March 2020, according to the investment offering. Between the first and fifth year of new ownership, The Landon could grow its occupancy rate from 65 percent to 78 percent, as well as increase the average daily rate from $105 to $128, the offering states. The seller made $460,000 in renovations.
Founded more than 40 years ago, Finvarb Group owns 13 hotels and restaurants, primarily in Miami Beach, but also in Texas, Arizona and other parts of Florida, according to the company’s website. Its holdings include the Courtyard by Marriott South Beach and Kimpton Hotel Palomar South Beach.
Finvarb Group had planned to develop a 36-room hotel in Miami Beach’s Sunset Harbour neighborhood, but zoning changes approved in July by the city no longer allow hotels in that area.
Recently, South Florida has had a series of big ticket hotel trades. Swire Properties sold the 352-key East, Miami hotel at Miami Brickell City Centre for $174 million, and a partnership led by Mast Capital sold the Conrad Miami hotel on Brickell Avenue in a deal worth over $100 million. Last month, Boston-based Rockpoint Group and Fort Lauderdale-based InSite Group, through an affiliate, bought the B Ocean Resort Fort Lauderdale for $117.9 million.