Greenberg Traurig got a $36.8 million loan for the restoration of two vacant Miami Beach properties to cover more than half the cost needed to breathe life into the historic buildings.
Miami Beach-based hospitality company VOS Hospitality, part of Trans Inns Management Inc., and health care and hospitality investment firm B Group Capital have partnered on the $60 million overhaul. The closed Greystone South Beach hotel at 1920 Collins Ave. and the Santa Barbara Hotel at 230 20th St. are next to each other and will be combined into a single hotel, The Greystone Hotel Miami.
Greenberg Traurig shareholder Bruce C. Rosetto in Boca Raton closed the loan for VOS Hospitality and B Group Capital on Dec. 22.
Shareholder Marcia H. Langley and associate Bracha Pollack, both in Boca Raton, and associate Ari B. Lustig in Delaware also worked on the deal. In addition, shareholder Josh D. Farrell and associates James Devlin and Joseph Sultan, all in New York, worked on the financing.
“Despite the fact that this was a $36.8 million loan, the complexity of it was more like a several hundred million dollar loan,” Rosetto said. “From a legal standpoint, we had corporate lawyers involved, we had lending lawyers involved, real estate lawyers involved and tax lawyers involved. It was a very complex transaction even though the actual construction loan amount was small compared to the type of deals we would normally see here.”
The project benefits from the federal historic tax credit program, a property tax credit developers can get for improving historic sites if they adhere to guidelines for preserving the historic character of income-producing property.
The 1939-built Greystone South Beach and the 1947-built Santa Barbara Hotel are in the Miami Beach Architectural District recognized by the National Register of Historic Places and the Museum Historic District recognized by the city of Miami Beach, records show.
While the tax credit is separate from the loan, it added to the complexity of the deal.
“When the loan is being provided and issued, all these other aspects have to be dealt with as well to make sure the security interest of all the different stakeholders remains as they had been negotiated in their prior deal,” Rosetto said.
Moinian Capital Partners, the financing arm of the New York-based real estate developer Moinian Group, which launched last year, issued the loan.
Greystone Terra Firma LLC, affiliated with Trans Inns Management, bought the Greystone South Beach for $7.5 million in May 2012, according to Miami-Dade County and state property records. Santa Barbara 230 LLC, also affiliated with Trans Inns Management, bought the Santa Barbara Hotel for $7 million in January 2014.
The Greystone Hotel is expected to reopen this year, according to VOS Hospitality’s website. It will have 92 rooms, a 135-seat restaurant, a 45-seat outdoor cafe, a rooftop pool and entertainment area, and a 1930s-style basement speakeasy, Rosetto said.
“The outside of the building will stay the same. The four walls will stay the same so the character and aesthetics remain the same,” he said.
The Greystone Hotel is about two blocks from the Miami Beach Convention Center being overhauled at 1900 Washington Ave.