Done Deal! The Raleigh sold to W South Beach's David Edelstein & SLS's Sam Nazarian for $55M
Plans for new Michael Schwartz restaurant still underway; kitchen renos start soon
August 9, 2012---In an announcement made at an all-staff meeting today in the hotel's ballroom, The Raleigh hotel GM confirmed that the landmark Art Deco hotel had indeed been sold to W South Beach developer David Edelstein and his partners, interestingly, SBE Hotel Group, which happens to own The Raleigh's brand new neighbor, SLS Hotel South Beach. Not since Ian Schrager's Morgan's Group has there been such an interesting menagerie of related hotels on a single South Beach block. Sale price? "Just over $55 million but under $60 million," says our source.
In 2009, Andre Balazs sold the hotel for a speculated $31 + million to Brilla Group, a Miami-based real estate private equity firm, and AJ Capital Partners, a Chicago-based real estate investment company. Rumor had it that Balazs wanted it back. True or not, Edelstein and co. wanted it more.
Also confirmed: Michael Schwartz will still be opening a new restaurant in the hotel and while dates for restaurant and hotel wide renovations weren't announced, we're told that kitchen renovations are starting very soon. Stay tuned.
UPDATE December 21, 2012: The sale has been finalized, according to a press release we received on December 21, 2012. Also confirmed was the $55 million pricetag. Here are a few statements made by Edelstein and SLS's Sam Nazarian:
“David and I share a deep passion for South Beach, and ensuring a celebrated jewel like The Raleigh is preserved in a manner fitting of its great legacy is a mission we are both supremely committed to,” said Nazarian. “South Beach is one of the world’s premier hospitality destinations, and The Raleigh provides the perfect complement to the community and to the experiences offered at SLS Hotel and W South Beach.”
“The Raleigh is a hotel that is truly representative of Miami Beach,” said Edelstein. “Its rich history and overall guest experience is something that has drawn people to this property for many decades. I want to transport The Raleigh’s trademark elements and adapt them to fit within different environments. I admire the work Sam has done with his SLS and Redbury hotel brands and look forward to the creative energy he and his team will infuse into this project.”
sbe Hotel Group will assume full operational control of the property this month and, in collaboration with Edelstein, will initiate the comprehensive renovation expected to begin in April 2013 and run until November. The initial phase will include guestroom renovations, followed by the lobby and other common areas. The property will remain fully operational throughout the process. Final renovation plans are expected to be unveiled later this month as sbe and Edelstein also work to overhaul the management, marketing and sales strategies.
In addition to retaining all current hotel staff, sbe and Edelstein are proud to resume The Raleigh’s partnership with James Beard award-winning chef Michael Schwartz. Chef Schwartz, who is best known for Michael’s Genuine Food & Drink in Miami’s Design District and Grand Cayman, will continue to oversee food operations and is expected to debut a new restaurant concept at the hotel in 2013, in concert with the renovation.
“We’ve demonstrated our ability to successfully reinvigorate hotel properties and leverage our operational expertise to deliver something that resonates with our clientele in a powerful way,” said Arash Azarbarzin, President of sbe Hotel Group. “There are so many timeless elements to the property and we’re looking to enhance those features and position the hotel for another 70 years of success.”
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