Blackstone Real Estate Debt Strategies (BREDS) has provided an affiliate of Fort Capital Management with a $290m construction loan for the development of a nine-acre Four Seasons resort at The Surf Club in Surfside, Florida.
The loan is for three years at a variable rate and carries a loan-to-cost of roughly 50%, a source told Real Estate Capital.
The new development will surround the recently-renovated 1930s-era club, which is located roughly six miles north of Miami Beach at 9011 Collins Avenue and features 900 feet of Atlantic Ocean frontage. Construction plans call for 151 Four Seasons condominiums and 77 hotel rooms, housed within three 12-story glass towers and two four-story buildings designed by Pritzker Prize-winning architect Richard Meier.
About 60 percent of the high-end residences have been sold, which in Florida is particularly beneficial because the deposits can be used as equity towards construction financing. The high-end condo component is the primary driver behind the profitability of the project, the source said, noting that “the full expectation is [Fort Capital Management] will have enough sold upon opening the building or shortly thereafter to pay down the loan or dramatically de-leverage.”
Hotel amenities will include a restaurant, a 15,000 sq ft spa, resort-style swimming pools, fitness centers and beach cabana lounges. The two four-story buildings will have space for retail and parking.
Fort Capital paid $116m to merge with The Surf Club in 2012, which involved the purchase of proprietor certificates of membership – the most expensive memberships at the club. The project is slated for completion in 2016.