Media outlets as reporting that the Soffers’ big-name partner in the Miami Beach resort Fontainebleau , the government of Dubai, is ready to sell its 50 percent stake back to the family’s Turnberry Associates. The deal would mark a satisfying bookend for Jeffrey Soffer, who spearheaded buying the resort in 2005 and then completing a $700 million renovation in 2008 on the eve of the financial crisis, the Miami Herald reported.
A year earlier, Dubai’s Nakheel Hotels paid $375 million for half the hotel, at a time when Soffer faced a cash crunch in both Miami Beach and Las Vegas. The Fontainebleau Miami Beach was on its way to being nearly 50 percent over-budget, and Soffer was building a second $3 billion Fontainebleau in Vegas that eventually halted construction when lenders cut off funds.
Despite the Vegas woes, Fontainebleau Miami Beach emerged from the recession a profitable hotel. It generated about $80 million in profit last year, according to a 2012 lenders report.
Dubai faced its own cash squeeze during the recession as a portfolio of ambitious real estate ventures (including a man-made island in the shape of a palm tree off the Persian Gulf) wasn’t generating enough revenue to sustain Dubai’s corporate debt.
Reuters and the Financial Times both reported the pending Fontainebleau, citing unnamed sources. They said the proceeds will help fund Dubai’s 2011 restructuring of $25 billion in debt, a deal that prompted a string of asset sales by the country’s corporate arm, Dubai World, to raise cash for lenders. Nakheel is part of Dubai World.
Soffer and a Fontainebleau spokeswoman were not immediately available for comment Tuesday afternoon.
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