Miami Beach Shore Club Sold for $175.3M

A joint venture between Ziel Feldman's HFZ Capital Group an affiliate of Fortress Investment Group LLC has acquired the historic Shore Club hotel in South Beach from Philips International for $175.3 million, or about $544,000 per room. The acquisition, one of the most expensive hospitality deals in the South Florida market, was financed in part with the assumption of an existing $161 million loan held by a group of lenders led by Fortress Credit Corporation and a new $12 million loan from the same group of lenders, according to a CoStar report. Philips International will continue to be involved with the new ownership group, and Morgans Hotel Group will continue to manage guest operations at the property.

"We have an extraordinary, once-in-a-lifetime opportunity to re-imagine and reposition a world-class property in a market that has seen continued demand for luxury properties," said Ziel Feldman, Founder and Managing Principal of HFZ, in a press release this week. "The development of oceanfront real estate on South Beach has been fueled by an expanding market for business and tourism, accessibility to international airports and year-round warm weather," he added.

"With ongoing demand from domestic and international buyers for prime South Beach properties and with Miami Beach's increasing global significance as a tourist destination, we expect the luxury residential and hospitality markets to continue their dynamic growth," added Nir Meir, Principal and Managing Director of HFZ.

For more news and information visit Blumberg Capital Partners.

Morgans Sells Two NYC Properties for $140M

Morgans Hotel Group sold off two of its boutique hotels in New York City, the Royalton and Morgans, for $140 million, or approximately $500,000 per room, late last month. Morgans sold the property to Felcor Lodging Trust but will continue to operate the hotels under 15-year management agreements with one 10-year extension option.

Michael Gross, Chief Executive Officer of Morgans said, "We are pleased to complete the sales of these New York hotels and we look forward to a long and beneficial partnership with FelCor as we continue to manage the hotels. With this transaction, we have now completed the sale of three assets which has allowed us to reduce our debt and provided us with financial strength to expand our brands."

Morgans reportedly used part of the proceeds to retire a credit facility. According to a Reuters report, the two hotels, along with the Delano hotel in South Beach that the company sold off in April, were collateral for the credit facility. Delano is currently unencumbered, the company said in a statement.

For more news and information visit Blumberg Capital Partners.

Morgans Sells Mondrian for $137M

Pebblebrook Hotel Trust has entered into a definitive agreement this week to purchase the Mondrian Los Angeles hotel from Morgans Hotel Group for $137 million according to a Wall Street Journal article. Under the terms of the deal, Morgans will continue to manage the hotel under a 20-year management agreement with one 10-year extension option. Morgans has received a $5 million security deposit, which is non-refundable except in the event of a default by Morgans. Pebblebrook expects to fund the purchase price with available cash and to close the acquisition during the second quarter.

The Mondrian Los Angeles is located on Sunset Boulevard and was originally built in 1959 as an apartment building. Reopened in 1996 after extensive renovation, the hotel is famous for its Asia de Cuba restaurant and Skybar bar and lounge.

Michael Gross, Chief Executive Officer of Morgans said, "This transaction further demonstrates the value of our real estate assets and our success in transitioning to an 'asset light' strategy. We are looking forward to a long and beneficial partnership with Pebblebrook as we continue to manage the hotel under the Mondrian brand with a long-term management agreement. The transaction proceeds will allow us to reduce our debt and fund the continued growth of our higher margin management business." Morgans has also recently agreed to sell the Royalton and Morgans hotels in New York. Reuters reported that Morgans has also been shopping the Delano in Miami.

For more news and information visit Blumberg Capital Partners.