Blue Suede kicks it up, buys second Miami Beach hotel this month

For the second time this month, Blue Suede Hospitality picked up a small Miami Beach hotel, quadrupling its Art Deco portfolio in the city. 

An affiliate of New York-based Blue Suede, led by CEO Kenneth Lipschutz, paid $16.6 million for Blue Moon Hotel, a 75-key Art Deco property at 944 Collins Avenue, records and real estate database Vizzda show. 

The deal breaks down to $221,667 per room.

An affiliate of Harrisburg, Pennsylvania-based Hersha Hospitality Trust, sold Blue Moon at a slight discount, after paying $16.7 million for the hotel in 2013, records show. The three-story building was completed in 1934. 

During an earnings call in August, Hersha executives said they planned to sell a Miami-area hotel, but did not identify the property. The same month, KSL Capital Partners bought Hersha and took the company private.

In 2020, Hersha had entered into a contract to sell Blue Moon for $30 million to an undisclosed buyer, but the deal fell through, published reports show. 

Meanwhile, Blue Suede is expanding its portfolio in Miami Beach. A few weeks ago, the firm paid $12.8 million for the Kayak Miami Beach, a 51-unit hotel at 2216 Park Avenue. Blue Suede purchased the two-story Art Deco building from a lender that acquired the property in a deed in lieu of foreclosure from the previous owner, Santa Monica, California-based Raven Capital Management. 

Blue Suede plans to rebrand and renovate Kayak Miami Beach, which was built in 1936. 

Last year, Blue Suede bought the South Beach Plaza Hotel at 1401 Collins Avenue and The South Beach Plaza Villas at 1411 Collins Avenue. The firm paid $26.5 million for the two Miami Beach properties, which have a combined 79 rooms. The Art Deco buildings were completed in 1934 and 1936, records show. 

Miami Beach’s hotel submarket is performing well. From January through April, the city’s hotel occupancy rate hit 79.8 percent, a 2.3 percent increase compared to the same period of last year, data from the Greater Miami & Miami Beach Convention & Visitors Bureau shows.