Castle Beach Club Miami Beach May Be Bought After All

Terra, a development firm headed by David Martin, has submitted a $500 million offer to acquire the Castle Beach Club condominium building in Miami Beach, following the withdrawal of a similar bid from Related Group and 13th Floor Investments several months ago.

The approximately 570-unit, 18-story Castle Beach Club at 5445 Collins Avenue has been on the market for over a year. A Colliers South Florida team led by Ken Krasnow and Gerard Yetming has been handling the sale, and Terra was one of nine firms that submitted bids last year, which included a joint venture between Related and 13th Floor.

Terra declined to comment on the specifics of the proposed deal. The company is in the process of preparing contracts for individual unit owners, who will have approximately two months to decide whether to accept or reject the offers. Terra has the financing in place to complete the purchase, according to a letter sent to unit owners by Yetming.

Built in 1966, the Castle Beach Club has experienced several unsafe structure violations. The scrutiny on older buildings has increased following the 2021 Surfside condo collapse. The Castle Beach Club site, occupying four acres and zoned RM-3, could accommodate a new project of over 500,000 square feet with nearly 600 units and 20 stories. The property features 576 feet of beach frontage.

Owners of units in older buildings may be more motivated to sell due to new statewide condo safety legislation, financial reserve requirements, escalating construction costs, and insurance premiums. However, developers are becoming more cautious as the market slows down and financing becomes more difficult to obtain.

If Terra secures enough support for a bulk purchase, it intends to terminate the condominium and demolish the building to make way for a new development. Terra has been actively involved in numerous projects across South Florida, including Miami Beach developments such as Five Park, a mixed-use development in North Beach, and the planned Miami Beach Convention Center Hotel.