Alan Lieberman walked up the stairs of his latest renovation project and pondered the future.
“This could be it,” the 63-year-old hotelier said during a tour of the under-construction Croydon Arms, 3720 Collins Ave., set to open this spring.
Real estate costs are spiking, and competition for good deals in Miami Beach is fierce.
But if history is any indication — and his son has a say — Lieberman and his South Beach Group will continue to expand at a rapid pace throughout South Florida.
“I think we’re finally ready, we feel like we have a machine going to the point where we can start opening properties a lot faster,” said Nathan Lieberman, 34. “I would say Fort Lauderdale all the way down along the beach, anywhere near the beach is a great place to build a hotel right now.”
Already, South Beach Group has grown tremendously since the elder Lieberman bought the 49-room Hotel Shelley more than 15 years ago. After buying, renovating and adding small boutiques and former apartment buildings for more than a decade, the company now boasts nearly 1,000 rooms in 12 different hotels with about 500 more rooms in development. In addition to the 100-room Croydon Arms, some other upcoming projects include short-term furnished apartments at 75th and Collins and a building around 36th and Collins, which Alan Lieberman hopes will close sometime this year. That would be the company’s first hotel directly on the beach.
Existing properties range from party hotels such as the Catalina Hotel & Beach Club to quieter lodgings such as the Metropole to extended stay properties such as the Tradewinds Apartment Hotel. Many of the group’s hotels, such as Catalina, are made up of multiple buildings. Only one of the hotels is not on Miami Beach: the Hollywood Beach Suites, Hostel + Hotel.
Alan Lieberman said the company only pursues projects that make financial sense — the recently completed part of Riviera South Beach, for example, was built on an empty lot that Lieberman bought more than 20 years ago. He bought the Croydon Arms for about $6.75 million and will spend roughly $12 million renovating.
That strategy has allowed the company to develop “very nice, high-quality boutique hotels” that were more affordable to build — and more reasonable for hotel guests — in part because they are not right on the ocean, said Max Comess, a director in the hotel group at commercial real estate investment banking firm HFF.
The company is part of a trend in Miami Beach, where “some of the coolest, hippest, most sought-after properties are across the street” from the water because owners had the ability to invest in renovations rather than paying beachfront prices, said Comess, who is familiar with South Beach Group through interactions in the city.
“They’re able to deliver this product because they were able to acquire these buildings at very attractive costs over the years,” he said. “And in many cases they’ve been long-term owners. You can say that they really are behind this off-beach renaissance that is attracting institutional buyers.”
The renovations have also earned praise from neighbors.
Ray Breslin, president of the Collins Park Neighborhood Association, called the family a “huge catalyst” in developing the area. Last year, South Beach Group received an Architectural Award of Merit from the association for restoration of the old Collins Plaza Hotel, which became part of the Riviera Hotel.
“They carefully look at the dynamics of each location and blend and meld their operation to fit into the the neighborhood, making their mark each and every time,” Breslin wrote in an email.
The most recent project, the final addition to the Riviera South Beach, opened last year on Liberty Avenue near the Miami Beach Convention Center. The next, the British-tinged Croydon Arms, is set to open in the spring.
The one-a-year pace is typical of the company, which keeps construction work in-house. Several years ago, Alan Lieberman bought the construction company that did projects for him; it is now dedicated full-time to his projects. Lieberman handles interior design himself and subcontracts electrical and plumbing work.
“There’s no way you can buy buildings and try to build them in a year and use a general contractor,” he said. “You have no control. You have to have control.”
Although he has no title, Alan Lieberman maintains control of the company, of which he is majority owner. His son, who oversees food and beverage operations, has a smaller stake, and managing partner Stephanie Balazs concentrates on selling the considerable inventory.
“I’m on the Internet like 23-7, because I have to sleep,” said Balazs, who tweaks rates constantly to make sure rates are competitive. “Alan and Nathan are the face of the hotels. I’m making sure the rooms are full.” She said the hotels maintain occupancy of between 93 and 94 percent year-round, with rates strongest in March, February and April.
South Beach Group, with hotels that mostly sit in the three- to four-star range, seeks to differentiate itself by offering more value than other hotels in the category.
“I think the people who don’t stay on the beach at a four-star hotel at today’s prices are looking for value,” Alan Lieberman said.
So the hotels offer free shuttle service to and from Miami International Airport, free Wi-Fi in hotel lobbies and and guests can take advantage of a free happy hour each night.
“Our whole business model is to give more for less,” Nathan Lieberman said.
That strategy was key to carrying the business through slower stretches during the recession and following the Sept. 11 terrorist attacks. Nathan Lieberman said he remembers selling hotel rooms for $20 on Tuesday nights to stir up business back in 2001.
“You have to be ready to float with the market,” he said. “You have to accept what’s going on and understand the market and really move with the tides and be flexible. And if you’re flexible, there’s a bad week but hopefully you’ll have three good weeks that month.”
Alan Lieberman said having hundreds of rooms with centralized offices for information technology, sales, reservations and other departments is also key to the company’s success.
“I don’t know how people have a 50-room, 100-room hotel,” he said. “They do it. They don’t make money.”
South Beach Group has stayed profitable even through the economic downturn, and saw significant growth in 2013, when revenue per available room soared nearly 17 percent over the previous year.
The company has also embraced what might be seen as unusual publicity opportunities, hosting the cast of MTV reality show Jersey Shore for a couple months and participating in a CW program that featured staff at the Catalina (as well as Nathan Lieberman).
The Catalina only lasted one season , but the younger Lieberman — who studied film finance in college and is a partner in a production company called Beach Pictures — said it is popular now in Asia.
“That show put a lot of things in perspective,” he said. “Like how close hospitality is to entertainment and how for everyone else kind of looking at the hotel, it is truly entertainment and we need to go out of our way to really entertain our guests.”
Alan Lieberman, an art collector, drew headlines when he said the new Riviera featured tiles produced by Banksy, the street artist. After research by the Miami New Times revealed the tiles were only inspired by the elusive artist, Lieberman said the tile company had produced misleading material. And then he bought prints based on Banksy’s actual work to adorn the outside of the hotel.
“I made sure that they’re from a company that’s authorized to sell them,” he said.
Lieberman’s enthusiasm for his work is still evident as he points out the art in one lobby or the design details he’s including on another project.
“If you want to gut and rebuild Art Deco hotels, you have to love what you’re doing,” he said.
His interest was spurred during a winter visit when he was still in college at Temple University back in 1968.
“I just looked around and said ‘This is unbelievable,’ ” the Philadelphia native recalled. “Miami Beach was diverse and interesting, all kinds of things going on, it was warm.”
He went on to own and manage apartments in Philadelphia but kept visiting South Florida, eventually becoming a snowbird and moving here permanently with his wife Diane Lieberman, who owns South Beach International Realty. The couple live in Aventura; she is on the board of North Miami’s Museum of Contemporary Art and he sits on the New World Symphony board. They founded the long-running Alan and Diane Lieberman Children's Cultural Series through the Michael-Ann Russell Jewish Community Center to give young kids in North Miami-Dade access to cultural performances.
Developer Russell Galbut, managing principal of Crescent Heights, knows the family primarily through charitable organizations they have in common. But as an investor in another family-owned hotel company, Menin Hotels, Galbut also knows the Liebermans as business people.
“They’re the type of hoteliers that are the old-style hoteliers,” Galbut said. “They work their butts off and do a great job.”