"Those guys are not extravagant spenders, they are very astute buyers," Trusty said. "Miami Beach goes through cycles of either irrational investments or really irrational investments. These guys are making good deals."
Building Plans
Half of the properties Chetrit recently amassed are in a block immediately east of the Miami Beach Convention Center, which is set to be redeveloped once the city chooses between two competing development groups.
Chetrit wants to partially demolish, renovate and restore the two- and three-story buildings to make room for a hotel. The company and its local partner Ari Pearl plan to make rooftop additions and build a five-story building as part of what will be the Collins Park Hotel. They paid $10.82 million for the block in April 2012.
Late last year, Chetrit received city approval to renovate and expand the Versailles Hotel at 3425 Collins Ave. During the real estate boom of last decade, Versailles' 289 rooms were converted to condominiums. Chetrit has bought back more than half of those units.
The company "is getting involved with hotels others wouldn't get involved in," Trusty said. "If you have 200 [condo owners] you have to deal with, not many investors have the patience for that."
Chetrit also owns the Tides Hotel at 1220 Ocean Drive, which it acquired for $20 million in 2011. It purchased the parking lot, office building and retail property behind the Tides and plans to redevelop them into a boutique hotel. And, the company owns the Fairwinds Hotel, which is set to be restored and expanded.
The section of Collins Avenue where the Miami Beach Resort is located has had a resurgence of investment as South Beach reaches a saturation point for investment activity, according to Marinberg, the Greenberg Traurig shareholder.
"It is so difficult to find good assets in Miami Beach as viable hotel options," he said. "There is really not that much more of an opportunity, even in Mid-Beach and North Beach, with a limited amount of space for new construction."
