Summary:
- Nahla Capital won a $275 million bid for The Raleigh condo and hotel project in Miami Beach.
- Owner Michael Shvo, who bought it in 2019 for about $243 million, is trying to match the offer and retain control.
- A deal could mark a new phase for the site, now limited to the remains of three hotels and a vacant lot.
NAHLA CAPITAL WON a bid to acquire The Raleigh, a condo and hotel project on the Miami Beach, Florida, waterfront for about $275 million, Business Insider reported. Work on the project has been stalled for six years.
The Raleigh development includes three adjacent hotels in Miami Beach’s Art Deco district: the Richmond, the South Seas and the 80-year-old Raleigh. Nahla, a New York-based real estate private equity firm, is led by Cofounder and Managing Principal Genghis Hadi, who was born and raised in Dubai and has lived in the U.S. since 1999.
Michael Shvo, who acquired the property in 2019 for about $243 million, is attempting to match Nahla's offer and keep control of the project, Business Insider reported, citing two people with direct knowledge of the talks. They cited a provision giving Shvo a first right of refusal, requiring him to raise capital to pay his partners and potentially secure new debt or extend his current loan.
One of Shvo's main financial backers was Bayerische Versorgungskammer (BVK), a German pension system that has invested in multiple U.S. real estate deals with him. A deal could mark a new phase for the project, which has long consisted of the remains of the three hotels and a vacant lot.
Shvo plans to restore and redevelop the hotel properties, build a beach club and restaurant next to the site's historic pool and add a condo tower designed by architect Peter Marino, the report said.
The project's $190 million debt, which was set to expire July 16, is helping to drive a sale. BH3, the Miami-based lender and developer that issued the loan, recently granted a three-month extension to allow Nahla or Shvo to arrange an acquisition.
Holding the property has burdened the current owners with high costs.
French luxury group LVMH recently sold its only U.S. hotel, El Encanto in Santa Barbara, California, for $82.2 million.
