Elliott Management Buys Miami Beach Hotel

Paul Singer’s Elliott Investment Management is expanding its real estate endeavors in South Florida by buying a hotel in Miami Beach. 

The West Palm Beach-based hedge fund paid $52.5 million for The Gates Hotel South Beach, according to a deed, while also securing a $82.5 million loan from Deutsche Bank. The disparity between the deed and financing is likely to account for the property’s non-real estate assets, such as the hotel operation and furniture.  

The 230-room property sits on a 1.3-acre site at 2360 Collins Avenue, at the southern end of Lake Pancoast, across the street from the oceanfront 1 Hotel. The property includes a two-story building, the former Motel Ankara that opened in 1954, and an eight-story building, which was completed in 2015. 

The seller, private equity firm Rockpoint, acquired the 148,514-square-foot hotel for $105 million in 2016, according to the Miami Herald. The Boston-based firm embarked on an extensive renovation, which ended three years later. 

Representatives for Elliott Management and Rockpoint did not immediately respond to requests for comment about the full value of the transaction. 

The sale marks Elliott Management’s latest real estate venture in Miami. This year, the activist investment firm, notorious for its brutal tactics, partnered with Adi Chugh to found Tyko Capital, which has emerged as one of South Florida’s most important lenders. 

The lender funneled $424 million and $527 million for the construction of Related Group’s luxury condo projects in Brickell and Bal Harbour, respectively. It also provided $565 million to refinance 830 Brickell, Miami’s trophy office building. 

In October, Elliott Management partnered with Morning Calm Management to buy the 32-story 701 Brickell office tower for $443 million, in one of South Florida’s largest office deals this year. 

Julia Echikson can be reached at jechikson@commercialobserver.com.