Posted on Tue, Nov. 04, 2004
Sheraton may cede to condos
Jorge Perez has signed a contract to buy the Sheraton Biscayne Bay hotel and ultimately plans to erect condominiums in its place, sources close to the deal say.
BY MATTHEW HAGGMAN
Miami developer Jorge Perez has signed a contract to buy the Sheraton Biscayne Bay hotel on Brickell Avenue, which sits on nearly five acres of prime waterfront land.
Perez, who heads the Related Group of Florida, ultimately plans to bulldoze the hotel and erect three 50-story condominium towers on the site, according to a source familiar with the deal. For the time being, Perez may keep the hotel open while developing the first of the three high-rises.
Under the terms of the deal, Perez will pay more than $100 million for the 4.7-acre site owned by Massachusetts Mutual Life Insurance. Closing is scheduled for Dec. 15.
Perez and Massachusetts Mutual Life Insurance declined comment about the Sheraton property. Manny de Zarraga, executive managing director of Holliday Fenoglio Fowler, which is brokering the sale, confirmed a contract has been signed but refused to name the buyer.
''The site commanded strong interest from big national players as well as some offshore companies,'' de Zarraga said.
He said buyers were particularly attracted because, as opposed to buying a vacant parcel, the hotel can provide a profit source as development starts.
If completed, the transaction would be one more indication that Miami's red-hot condo market is displacing development of other types of projects. Sites designated for office development in the downtown and Brickell area, for instance, are increasingly being used for condo development.
Now a hotel site would be occupied by new condo towers.
Perez ranks among South Florida's most prolific condo developers. He has more than three dozen projects stretching from South Pointe in Miami Beach to CityPlace in West Palm Beach.
He added another Tuesday. Although he declined to comment about the Sheraton deal, Perez said he signed a contract to pay more than $125 million for the Harbour House, a beachfront apartment rental complex in Bal Harbour.
Perez bought the property from Colorado-based Archs
tone-Smith. He plans to renovate the units and convert them into condominiums.
The hotel site at 495 Brickell Ave. would be his third development in the Brickell area. He is also developing twin condo towers called The Plaza at 901 Brickell Ave. and another condo project at 500 Brickell Ave.
Located near the mouth of the Miami River, the Sheraton Biscayne Bay parcel fronts Brickell Avenue and stretches to the bay. The protected Tequesta Indian site, called the Miami Circle, lies to its north. A public park is south of the property.
The Sheraton Biscayne Bay rises 17 floors and has some 598 rooms.
Perez plans to replace it with three 50-story condo towers comprising two million square feet. Each building will have about 1,800 residential units.
The project would take five to six years to complete, according to the source.
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