With Clock Ticking, Shvo Looks To Recapitalize Miami Beach Redevelopment
Shvo is attempting to push forward on its redevelopment of The Raleigh hotel in Miami Beach.
The developer announced a new future for the historic property in 2022, partnering with luxury hotel brand Rosewood Hotels & Resorts and renowned architect Peter Marino. However, two years later, speculation over the project’s progress swirled as several of the company’s Miami employees were laid off, Bisnow reported in August.
Now, materials obtained by Bisnow show the developer retained Newmark to market the property to potential investors, and a Shvo spokesperson confirmed it is working to recapitalize the project.
“As the firm begins construction on its 17-story residential tower, Newmark has been tapped to recapitalize the project,” a spokesperson told Bisnow in a statement Wednesday.
An undisclosed partner in The Raleigh’s development is looking to exit the project, Shvo told Business Insider.
Newmark declined to comment.
Upon completion, The Raleigh is expected to feature 60 hotel suites and 42 ultra-luxury residences along with the members-only Langosteria Beach Club, according to a Newmark offering memorandum obtained by Bisnow.
Jan. 3, The Times reported that the project is expected to be delivered in 2026. However, a financial model for the project's development, which Bisnow obtained, projects that construction is expected to start in February 2026 and end June 2028.
As of Dec. 16, contracts were signed for five of the residences, according to a stacking plan obtained by Bisnow. The total price of the units is $67M at an average of $4,371 per SF. Four other units are under sponsor hold. The plan places the total prices of all units at $960M, with $5,805 per SF.
The 3-acre Miami Beach development site at 1751, 1757 and 1775 Collins Ave. comes with 220 linear feet of ocean frontage, full approvals and a full building permit in Miami Beach, according to the materials.
The project’s financing consists of a $190M land loan and a $525M construction loan. An announcement by the company said that over $1B is being invested into the project.
BH3 Management provided a $190M loan for the property in 2023 that also paid down original financing from ACORE Capital. The loan matured in July, but BH3 granted Shvo a six-month extension with future extension options, a BH3 spokesperson previously told Bisnow.
Developer Michael Shvo is known for lavish redevelopment of historic buildings. In some, he has also faced contentious lawsuits.
That includes the Transamerica Pyramid, where he spent $400M in renovations after originally buying the San Francisco landmarked tower in 2020 for $650M. The tower reopened in September but has been clouded by a lawsuit from a members-only club that was expected to take 45K SF at its space.
The development of The Raleigh, along with the Transamerica Pyramid and the former Coca-Cola building in New York City, has in part been funded by Deutsche Finance America, which manages investments for several German funds.
That includes pension fund Bayerische Versorgungskammer. In October, Bisnow reported that the Bavarian State Parliament has launched an investigation into BVK for its real estate investments.
In previous statements, BVK has asserted that it has no relationship with Shvo and that its investments are only through shares it holds in an indirect fund together with other investors, which in turn is invested in real estate projects.
