Dive Brief:
- In a deal valued at over $400 million, Geneva, Switzerland-based private equity investment firm Reuben Brothers acquired W South Beach in Miami from New York City-based investment firms Tricap and RFR, the buyer announced in a release obtained by Hotel Dive.
- The Marriott International-branded luxury hotel and residences offers 348 managed hotel and condo units, according to Reuben Brothers. The property has played “a pivotal role in Miami Beach's luxury tourism and real estate expansion,” serving guests during Art Basel and other top Miami Beach events, the firm said.
- With the acquisition, Reuben Brothers grows its hospitality portfolio, which includes other Florida properties. The large transaction marks the latest to close amid strengthening hotel investment fundamentals, set to spur increased deal volume into next year, hotel experts forecast.
Dive Insight:
The W South Beach acquisition “reinforces Reuben Brothers’ commitment to strategically expanding their hospitality portfolio in the United States,” according to the firm.
Reuben Brothers adds W South Beach to a global hotel portfolio including other Florida properties like The Vineta, formerly known as the Chesterfield, in Palm Beach. The firm also owns 25% of the 300-acre Turnberry Resort & Spa managed by Marriott in Aventura, Florida, along with luxury hotels in New York City and Los Angeles.
The deal comes amid heightened investor appetite for “high-quality, large transactions, particularly for luxury hotels situated in high growth markets and urban centers,” according to JLL. The real estate advisory firm reported in August that total single-asset hotel transaction volume for deals larger than $200 million had reached its highest level in eight years.
Hotel investment is expected to increase starting next month and snowball into next year, spurred by additional interest rate cuts, Kevin Davis, Americas CEO for JLL Hotels & Hospitality Group, forecasted earlier this month at The Lodging Conference.
Other hospitality professionals at the conference agreed, including Extended Stay America CEO Greg Juceam, who predicted a significant amount of anticipated refinancing and an increase in property improvement plans will also contribute to heightened deal activity.
For W South Beach, Reuben Brothers plans to lead the property through a “transformative new chapter” with a vision to “reimagine its future and deliver an unparalleled luxury experience,” according to the firm. Reuben Brothers did not immediately respond to a Hotel Dive request for comment on its future plans.
Marriott’s W Hotels flag recently underwent a multiyear brand evolution, after which the company opened a flagship location in Hollywood, California, earlier this month. Marriott also plans to convert MGM’s Delano Las Vegas under W Hotels.
