After buying former Philadelphia Phillies slugger Ryan Howard’s uber-opulent Belleair Shores mansion for $16.5 million, property investor Ben Mallah now has one heck of a house payment to make.
The burden, on paper at least, lessened a bit last month when Mallah’s Largo-based company, Equity Management Partners, sold two hotels — the oceanfront Mayan Inn in Daytona Beach and the Hawthorne Suites on International Drive in Orlando — for nearly $25 million. The firm made about $7 million in profit from the deals.
Mallah tells Coffee Talk that wariness of an impending slowdown in the real estate market motivated him to sell the properties, in addition to a desire to consolidate his portfolio closer to home.
“The market in Orlando is crazy — they’re building everywhere,” he says. “The market might not crash, but it can go only one way, and that’s down. There’s going to be a 20% correction, so if you can make a profit, take it and move on.”
Mallah owned the Hawthorne for two years and the Mayan for three. Maryland-based Blue Water Hospitality bought the 112-room Mayan, while the Lighthouse Group, a real estate investment firm that Mallah competes with in the apartment sector, acquired the 176-room Hawthorne Suites. Lighthouse plans to convert it from a Wyndam-flagged hotel to apartments.
“The problem is that Orlando is getting too competitive,” Mallah says. “Now Universal [Studios] is building hotels. It’s like Vegas without the gambling. They just want to get you there. I don’t think they even care about making money on the hotels they’re building. Their goal is to get you into the park and buy all their crap.”
Mallah, who's turned his focus from hotels and multifamily to shopping centers, says he doesn’t care if he left money on the table by trusting his gut and selling at what he believes is the market peak. “It’s a seller’s market,” he says, “and it’s a good time to get out.”