A $188 million commercial mortgage-backed securities (CMBS) loan tied to the St. Regis Bal Harbour Resort has been sent to special servicing, according to a report from Morningstar. The loan is set to mature next month.
The owner of the property, Al Rayyan Tourism Investment Company (ARTIC), based in Qatar, remains current on its mortgage payments and holds an option to extend the maturity date. The resort is located at 9703 Collins Avenue in Bal Harbour.
The lender, Column, which is based in San Francisco, is currently considering ARTIC’s request for an extension on the loan, as reported by Morningstar.
Despite ARTIC maintaining a debt service coverage ratio above breakeven levels, its net cash flow for 2024 dropped to about half of what it was in 2021. This decline may lead bondholders to apply greater scrutiny to the property’s financials.
ARTIC’s chairman is Sheikh Faisal Bin Qassim Al Thani of Qatar’s ruling family. In 2021, ARTIC obtained the CMBS loan and used it to extract $44.5 million in equity while paying off a previous $132 million mortgage that had been held by London-based Reuben Brothers.
St. Regis Bal Harbour is a condo-hotel completed in 2011 with three towers containing a total of 192 hotel rooms and 205 condominiums. ARTIC purchased the hotel portion of the property—located in the central tower—for $213 million in 2014 from Starwood Capital Group led by Barry Sternlicht.
Loan filings indicate that ARTIC invested an additional $40 million into renovations for the property. In 2023, the condo association for St. Regis Bal Harbour Residences filed a lawsuit against ARTIC alleging building defects, health and safety concerns, and claims of financial mismanagement. The lawsuit seeks a full assessment of the building along with remediation measures for various alleged problems; it remains pending in Miami-Dade Circuit Court.
In another move this year, ARTIC sold its ownership interest in W Miami—a separate hotel property in Brickell—to a joint venture formed by BH Group and Süzer Group. The sale price was not disclosed.
