The man who started Dell Computers has bought the Boca Raton Resort & Club.
Michael Dell started MSD—for Michael S. Dell— Capital in 1998 as an investment vehicle for his assets. Fortune magazine ranks Dell as the 39th richest person in the world, with a net worth of nearly $30 billion.
MSD Partners—the investment arm of MSD Capital— becomes the hotel’s ninth owner since its founding in 1926 by famed architect Addison Mizner. Other owners have included utilities magnate Clarence Geist, the Schine family, Arvida, VMS Realty Inc., Florida Panther Holdings, Blackstone Group, and Waldorf-Astoria.
John Tolbert, president and managing director of the resort, is optimistic to the point of giddy about the future of the property. He called MSD Capital “best in class” for hospitality standards and practices. “No one will care more for this resort,” Tolbert said. “They are the best owners since Addison Mizner.” MSD maintains a small office in West Palm Beach.
The parties did not disclose the sale price. Nor has the deal closed. Hilton will continue to manage the resort as a Waldorf-Astoria property. The release quoted Coburn Packard, a co-principal of MSD’s real estate division:
“Boca Raton Resort & Club is irreplaceable real estate in a rapidly growing South Florida market. In each of MSD’s real estate investments, we maintain the mindset of a long-term steward, and we look forward to further enhancing the member and guest experience at what already is regarded to be a top-tier resort property.”
Dell is one of several mega-rich tech entrepreneurs who have been investing in luxury properties, which suffered much less than others during the Great Recession. Oracle co-founder Larry Ellison bought 98 percent of the Hawaiian island of Lanai, which is home to a pair of Four Seasons resorts. Through his Cascade Investment firm, Microsoft co-founder Bill Gates recently has bought hotels in Atlanta, Houston and Mexico.
Elsewhere, MSD recently announced a joint venture to renovate the Grand Hyatt next to Grand Central Station in Manhattan. MSD Capital acquired the Four Seasons Maui in 2004, the Four Seasons Hualalai in 2006 and Four Seasons Kona Village in 2007. MSD Capital is using architect Cesar Pelli to redesign the Fairmont Miramar Hotel in Santa Monica, Calif.
The last two owners made roughly $600 million worth of upgrades to the Boca Resort, which also includes the 26-story tower and the Boca Beach Club. In all, the resort has 1,047 rooms on its 337 acres. There’s a 32-slip marina, a pair of 18-hole golf courses and 13 restaurants and bars.
In a way, MSD’s acquisition resets the resort to 1997. Huizenga formed an investment company for the money he amassed from starting Waste Management and Blockbuster Video. It will be interesting to see whether MSD proposes additional development for the resort. Previous proposals drew criticism from homeowners. Phases 2 and 3 of Via Mizner are under construction just west of the resort. They will feature a Mandarin Oriental hotel and a luxury condo whose owners will have Mandarin hotel privileges.
Ice rink?
Is an ice rink in Boca Raton’s future?
During Monday’s workshop meeting, City Councilwoman Andrea O’Rourke touted such a project, though she didn’t give a location. O’Rourke later told me that it would be on Congress Avenue* on private land. The project, she said, would require a text amendment—a change to zoning.
In an email, O’Rourke called it “a great project and addition to our community.” Nothing has been filed with the city. O’Rourke said it’s a project of Malcolm Butters, who owns Coconut Creek-based Butters Construction. His company is acquiring the roughly six-acre site near the Tri-Rail station at Yamato Road.
I left a voicemail for Butters but did not hear back by deadline for this post. I will update if there’s more.
* We incorrectly reported that the project would be off Spanish River Boulevard. We regret the error.
The Wildflower…again
Sometimes, it can seem as if the only thing that matters in Boca Raton is the Wildflower property. One of those times came Monday.
During the city council workshop meeting, Councilwoman Andrea O’Rourke again told City Manager Leif Ahnell that she wanted a faster timetable for work to convert the vacant site along the Intracoastal Waterway to a park. Construction is set to begin next year. Work will take two years.
O’Rourke has fixated on the Wildflower schedule and has received support on a stepped-up schedule from Councilwoman Monica Mayotte. O’Rourke based much of her 2017 campaign on the ordinance that voters approved the previous November. It killed the proposal for a revenue-generating restaurant on the site, which the city bought in 2009. Mayotte also supported the ordinance, whose backers falsely stated would protect waterfront parks from development. The Wildflower property not was a park. No one had proposed development on any city-owned waterfront property.
O’Rourke’s comments seemed tied to an April 18 email to council members from Margaret Fitzsimons, head of a group called 2020 Vision. She claimed in the long email to have a plan that could lead to the opening of the Wildflower park in June 2020. A redone Silver Palm Park, on the other side of the Palmetto Park Road Bridge, would open a couple of months later. Fitzsimons based these conclusions on what she claimed to be 20 to 30 years of experience “going through this process on projects.” She did not list any projects.
The focus on the Wildflower has dominated what the city had envisioned as a comprehensive makeover of Boca Raton’s waterfront parks. The city hired a consultant— EDSA—to draw a Wildflower plan. Last November, the council made many suggestions to EDSA’s first draft.
O’Rourke worries that the council won’t see the plan until it’s too late to make changes without adding time or cost. Some of her supporters have pushed for certain features and uses, so the council pretty has outsourced most of the work on this supposedly vital piece of land.
As the discussion went on, O’Rourke got more animated. The city should put a sign on the site, telling residents that something great is coming. What about naming rights? The city, O’Rourke said, could say to potential donors, “It can be your name on this sign.”
City Manager Leif Ahnell reminded council members that they had given “no direction” on naming rights. He cautioned that the county was being difficult on allowing access between Wildflower and Silver Palm through the county-owned slice of property under the bridge.
Ahnell said the city could invite EDSA back for an update. He sounded skeptical about a faster timetable.
Office Depot update
After a fairly encouraging end of the year, Office Depot has hit new headwinds.
Though financial markets are near record highs, that’s not so for Boca Raton-based Office Depot. The company’s stock price is near its six-month low from last fall, when markets were plummeting.
Last month, Office Depot drew a $25 million fine for trying to give unneeded computer repairs after drawing customers in with offers of free checkups. This month, one analyst predicted an “ugly year” for the company because of “operational challenges.” That came as Office Depot issued a reduction in earnings estimates.
Most recently, the company announced the departure of its chief accounting officer. News reports noted the projected $15 million loss from Compucom, the technology company Office Depot acquired.
While trying to fend off competition from online office supply retailers, Office Depot keeps pitching expanded services in its stores by offering “co-working” space. The executive vice president of retail said the company “remains dedicated to providing small- to medium-sized business customers with the products and services they need to run and grow their businesses from affordable private and shared workspaces to office and technology supplies to on-site IT support.”
Office Depot will report the company’s first-quarter earning on May 8.
WalletHub ranking
Though Boca Raton once was known for big employers such as IBM, the city now wants to attract business entrepreneurs. So city officials must have been glad to hear that the financial website WalletHub rates Boca Raton among the best cities to start a business.
The city ranks among the top third in workforce quality, which startup companies consider heavily when deciding on a location. What jumps out is the statistic that Boca Raton rates fifth-best for startups per capita. A lot of new businesses are opening. Now they just have to last.
I-95 update
It’s not all bad news from the Florida Department of Transportation.
The state is adding toll lanes on I-95 from I-595 in Broward County to Linton Boulevard in Delray Beach, with the work scheduled for completion in 2024. Construction is causing regular lane closures and interchange hassles in Boca Raton.
Another current project, however, is the repaving of almost eight miles between Atlantic Avenue and Gateway Boulevard. That pockmarked stretch of I-95 is one of the worst in South Florida. And when it’s done next spring, you can drive it for free.
