Miami Herald
February 04, 2023
by Rebecca San Juan and Taylor Dolven
The owners of The Tides Hotel may lose the Miami Beach building to foreclosure.
The dramatic tourism downturn caused by the COVID-19 crisis could soon bring new owners to The Tides Hotel, a South Beach landmark closed since 2017’s Hurricane Irma.
Safe Harbor Equity, the Miami Beach-based private equity firm that owns the hotel’s debt, started foreclosure proceedings on The Tides Hotel South Beach this week after acquiring the hotel’s debt from Ocean Bank in January.
The New York-based Chetrit Group purchased the 1930s Art Deco hotel at 1220 Ocean Drive in 2011 and has since bought out several other investors. Chetrit is a real estate company run by Joseph Chetrit and his three brothers. The company owns the Chelsea Hotel in Manhattan and a site on the Miami River it has long planned to develop, among other properties.
Once home to a bustling outdoor cafe and restaurant inside its terrazzo-floored lobby, The Tides has been awaiting renovations designed to once again make it an upscale icon. But plans to revitalize Ocean Drive have been derailed by the pandemic.
In April 2020, Safe Harbor Equity began raising funds to acquire distressed real estate debt, according to a BisNow report.
Safe Harbor moved to foreclose after Chetrit went silent during restructuring talks, according to a Safe Harbor spokesperson.
“We were told that they were in the process of obtaining some refinancing,” a Safe Harbor spokesperson said. “As in many instances, people say they are going to do something and don’t necessarily comply. We didn’t hear back from them and, upon not hearing back from them simply as a matter of course, filed an action.
“It doesn’t mean that we are not willing to work with them. We are willing to work with them to restructure the debt.”
Chetrit owed about $45 million to Ocean Bank on The Tides Hotel.
Should Safe Harbor take over the hotel, it plans to complete renovations and keep it as part of its portfolio.
“The Tides Hotel is an attractive asset for investment because it is in a sought-after location and of historical significance,” said a Safe Harbor spokesperson. “When hospitality does stabilize, the Tides will benefit from that, sooner rather than later.
“It is a historic, trophy asset,” the spokesperson said.
The Miami hospitality industry has been pummeled by the COVID-19 pandemic. After reopening hotels in June, occupancy has remained low county-wide, except for a few packed periods over the holidays. Occupancy in the county was 46.4% for 2020, down 38.9% from 2019, according to STR, a hospitality data firm.
Miami Herald reporter Rene Rodriguez contributed to this report.
