The Gansevoort-turned-Perry hotel in Miami Beach is set to open in its latest iteration early next year: the eco-minded 1 Hotel & Residences South Beach.
Owners of the massive property at 2399 Collins Ave. are investing more than $100 million in the project, a renovation that started after they bought it for nearly $230 million a year ago.
“This isn’t paint and carpet, this is a full gut of nearly everything in the property,” said Barry Sternlicht, chairman and CEO of Starwood Capital Group, an owner of the property. “You won’t recognize the building, you won’t recognize the pool deck, you won’t recognize anything.”
In addition to Starwood Capital, a private investment firm that is not affiliated with Starwood Hotels & Resorts, the ownership group includes the LeFrak Organization, a real estate development and management company, and investment manager Invesco. Entities controlled by Credit Suisse sold the property last year after the bank took it over in 2010.
The hotel will close at some point for renovations, though a specific date has not been released. It was not clear Wednesday what would happen to the jobs of current employees.
Plans are for the 417-room hotel, called a “lifestyle eco-brand” in a press release, to reopen in early 2014. The property will also include 163 residences that are expected to range in price from $600,000 to more than $6 million when they start selling in April.
Once finished, the property will include four pools, a new restaurant, a private lobby and arrival area for residents, new balconies, new views of the ocean and a new boardwalk.
Renovations to the 1970s building — including replacing windows and the air-conditioning system — are being done with a goal of earning LEED certification, a process that hasn’t always been easy.
“It’s about as wonderfully complicated as we’d imagined,” said Sternlicht, former chairman and CEO of Starwood Hotels & Resorts and the founder of the W Hotels brand. He drew inspiration for the hotel brand’s name from the U2 song One and the idea that the environment is the shared responsibility of one world.
But he and other owners said that for all the emphasis on the environment and nature, the hotel will still be geared to a sophisticated luxury crowd.
“We’re not just making a place that’s fun for tree-huggers,” said Richard LeFrak, chairman, president and CEO of the LeFrak Organization, another owner. “It’s still South Beach and it’s still supposed to be fun — and this place will be a lot of fun.”
Under the name Perry, the hotel was doing “pretty nicely, shockingly, for an independent hotel,” Sternlicht said; a search for rooms this weekend turns up rates starting at $599 a night. He expects the relaunched 1 Hotel to command higher rates as it competes with properties as diverse as the Loews and ultra-luxury Setai.
The Miami Beach location will be one of the first properties in the 1 Hotel brand; two others are planned to open in New York in 2014 and 2015, and Sternlicht believes the markets will reinforce each other.
While establishing a new brand can take years, opening with a known brand is not crucial in a market such as Miami, which is full of independent hotels, said Mark Lunt, partner in charge of Ernst & Young’s hospitality practice.
“It still comes down to location, location, location,” he said. “It’s well located and that will help it quite a bit. It’s the location, it’s well backed with a reputed developer and name. Miami’s hot right now, and I think it’s got everything going for it.”
Suzanne Amaducci-Adams, partner at Bilzin Sumberg and head of the hospitality group, said Miami can easily support another “hip hotel brand.”
“Basically every brand in the world wants to be in Miami and there’s been a lot of fights as to how to get there,” she said. “There are huge barriers to entry in the market.”