A birds-eye view atop a Collins Avenue construction site shows the past, present and future of South Beach, set to a symphony of construction noise.
The trailblazing Delano, which revitalized the destination in 1995 and is now being marketed for sale after an $11 million renovation, is flanked by the historic National Hotel, in the midst of a major restoration, and the Philippe Starck-designed SLS, formerly the Ritz Plaza, which opened in June after eight years and about $85 million.
“Miami is a hot market now, so it’s hard to get a hotel,” said Keith Menin, principal of Menin Hotels, which is developing the latest — but certainly not last — addition to the busy scene. The company’s 87-room Gale South Beach & Regent Hotel at 1690 Collins Ave. is set to open in early December, more than a year after finishing most of the renovations on the family-owned Shelborne just up the road.
After a recession-fueled pause, when visitor numbers dropped and financing dried up, Miami-Dade is in the throes of a hotel buying-and-building boom. Or, more appropriately, a re-building boom.
Local investment is following a national trend.
Shelling out billions
According to a recent report from Bjorn Hanson, a dean at the Preston Robert Tisch Center for Hospitality, Tourism and Sports Management at New York University, the lodging industry is expected to shell out a projected $5 billion this year on upgrades after curtailing spending since 2009.
Improvements could include everything from redesigned lobbies to better technology in rooms and meeting areas and more appealing fitness centers and restaurants, according to the report, which notes that the expected spending boost is due to vastly improved occupancy numbers and average daily rates.
In Miami, industry experts say robust tourism numbers, the scarcity of available land and the willingness of banks to lend money again are drawing waves of investors who see hotels in the destination as a must for their portfolios. Potential buyers include private equity firms, real estate investment trusts, major brands and some foreign investors.
“Miami is improving faster than a lot of the other markets, and it is a major, major market,” said Suzanne Amaducci-Adams, head of the hospitality group at the Bilzin Sumberg law firm. “So everybody wants to be here.”
Through September, hotels in Miami-Dade were more than 76 percent full, a small gain over the first nine months of 2011 despite a dip during the summer. But room rates have continued to climb, up nearly 7 percent to almost $163. And hotels countywide are making more revenue per available room; that figure grew about 8 percent to more than $124.55 through September.
Observers say the area is also gaining stature internationally because of the growth of arts and culture, as well as its ability to attract business from places including Russia and Asia in addition to Latin America.
“We really are just maturing and becoming a much more sophisticated global destination, and that’s really what is driving this,” Amaducci-Adams said.
Hotel transactions volume is expected to reach $650 million in the county this year, a 13 percent increase over 2011, according to brokerage Jones Lang LaSalle Hotels. And that figure doesn’t includes the hundreds of millions more being poured into upgrades at properties including the Perry Hotel South Beach (formerly Gansevoort Miami Beach) and Trump Doral Golf Resort & Spa, which mogul Donald Trump says he’s spending $200 million to fix up after he bought it for $150 million earlier this year.