Investor Confidence Increases in Miami Real Estate
Filed Under Blog ·
Village of Key Biscayne
In recent weeks there have been two high profile transactions in the Miami real estate community. In my opinion, these two sales represent both a positive psychological shift as well as boost of investor confidence in the Miami real estate market.
The Sonesta Beach Hotel on Key Biscayne, which was the first major resort hotel to be constructed on Miami’s prestigious Key Biscayne community in 1969, was sold to Argentine investors. According to local sources, Consultatio S.A., a publicly traded company based in Buenos Aires, Argentina, purchased one of the largest remaining develop-able oceanfront sites on Key Biscayne, which consists of the 40-year Sonesta hotel and 10 acres of land, for $78 million.
The Argentine developer was attracted by the opportunity to redevelop the site located at 350 Ocean Drive. In 2005, a local group including Edgardo Defortuna, purchased the Sonesta Key Biscayne property and then closed it down a year later. A couple of years later they secured the necessary approval from the city to build a 165 unit condominium as well as the permit to demolish the hotel. Unfortunately, due to the major cooling off in the housing market the project never got off the ground.
In 2008, the Key Biscayne market experienced several sales of luxury oceanfront condominiums as high as $1,500 per square foot in the Ritz Carlton, Grand Bay or Ocean Tower projects. Clearly, Consultatio S.A. was quick to recognize the opportunity to redevelop this site over the next few years and take advantage of the price of oceanfront real estate that this prestigious island off of downtown Miami commands.
In other news this week, the historic 105-room Raleigh Hotel in South Beach traded to local hotel investment company Brilla Group and AJ Capital Partners, for approximately $30 million. The all cash deal closed this week and has yet to be recorded in the Miami Dade County records.
The seller of the Raleigh Hotel, Andre Balazs and his investment group, acquired the art deco masterpiece designed by Murray Dixon, for $25.2 million in 2002. With occupancy rates and the average daily room rates suffering in the area, the fact that this property traded at $285,000 per room is a huge boost of confidence in the Miami hotel and Miami Beach market. According to local sources, the original asking price of the hotel was $40 million and it had been on the market for over a year.
Are you looking for a Miami or Miami Beach property at a deep discount? Are you looking for a discounted short sale or bank owned property? Ross Milroy of Miami Angel Properties, LLC may be reached at 305-673-5300 or info@miamiangelproperties.com.
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