Bahia Mar, 801 Seabreeze Blvd., Fort Lauderdale (Melanie Bell)
Veteran investors have snagged the ground lease for the iconic Bahia Mar Fort Lauderdale Beach resort and marina and are contemplating “significant upgrades” that could see them invest hundreds of millions of dollars in the property.
Sergio Rok and Jimmy Tate led an investment group that purchased the 48-year ground lease from Blackstone Group LP in a complicated deal that closed July 1 after nine months of negotiations and due diligence.
They’re tight lipped about the acquisition price and say it’s too early to disclose plans for the city-owned 39-acre property that includes submerged land and a marina at 801 Seabreeze Blvd. But they hint they could pump in about $250 million to refurbish the site and add stores, restaurants, residences and a new hotel.
The resort sits on a prime strip of land on the Intracoastal Waterway with an elevated walkway linking it to the oceanfront Fort Lauderdale Beach Park.
“It’s a significant figure,” Tate said about planned investments. “Looking at what Blackstone was prepared to do, they were looking at $250 million. You can use that as a ballpark figure.”
About four years ago, Blackstone received city approval for a redevelopment plan for a mixed-used project with office, retail and a five-star, 27-story Waldorf Astoria hotel topped with 22 luxury condos.
The buyers are likely to keep part of the proposal. They’re also considering refurbishing and redeveloping the 296-room hotel that operates under the DoubleTree by Hilton brand. One proposal would renovate the hotel’s main tower and tear down its smaller neighbor to make room for new construction.
“Whether it would be hospitality or residential remains to be seen,” said Kenny Tate, co-owner of Tate Capital LLC. “We want to improve upon everything.”
The developers say their plans for the site won’t interfere with operations at the DoubleTree or the 250-slip marina. Bahia Mar has long hosted the Fort Lauderdale International Boat Show, Broward County’s largest revenue-generating event, and will continue in that role.
“The beauty of this deal is we have strong cash flows that afford us the luxury of time to really do this right,” said Jimmy Tate, who’ll serve with Rok as managing partners of the venture. “We’re meeting with architects and will work with the city to figure out the highest and best use for the property. Right now we have a very well-operated hotel and marina. We want to do whatever we can to not disrupt these two operations.”
The Tate-Rok partnership has 48 years left on the lease and is in talks with the city to add another 50. They say they’ve assembled a large group of South Florida investors willing to transform the iconic site.
The partnership collectively owns 57 percent of the deal. Another 38 percent belongs to investment management group Rialto LLC, a subsidiary of homebuilder Lennar Corp. RCI Group, which specializes in residential and waterfront development, controls the remaining 5 percent.
“As important as the deal itself is the opportunity to work with friends and people we respect,” said Rok, head of Rok Enterprises Inc. and family-owned Rok Acquisitions LLC. “I’ve passed on a lot of deals that I thought were financially good, but I wasn’t happy with the partners.”
This month’s acquisition is the latest collaboration for Rok and Tate, who’ve partnered on 18 deals across the U.S. in the last four years, including purchasing the Omni Center in Miami, building an apartment complex in New Orleans and creating a 525,000-square-foot lifestyle center in Birmingham, Ala.
“This was a very well-rounded group that acquired this asset,” said partner Robert Christoph, founder and president of RCI Group, a Miami Beach-based waterfront developer and marina operator whose holdings include Boston Yacht Haven, Bridgeport Landing Development in Connecticut, Miami Beach Marina and Bayshore Landings, formerly Monty’s Marina, in Miami’s Coconut Grove neighborhood.
Each partner brought the expertise to aid the acquisition and underwriting and secured financing from JPMorgan in New York.
The complex deal included talks with Hilton, which has a management agreement that expires in 2031, and boat show organizers, who have leased the site until 2020 for the mega event.
“We saw this as an iconic asset that warrants a redevelopment plan,” said Jimmy Tate, CEO of Tate Capital. “And who better to do it than people who are part of the community?”