The remaking of an iconic Florida hotel property

A Credit Suisse and Trinity Investments JV is betting on a rebound in business travel in taking over the Diplomat Beach Resort.

The Diplomat Beach Resort (Source: Credit Suisse Asset Management / Trinity Real Estate Investments)

If the walls of the South Florida-based Diplomat Beach Resort could talk, they would tell stories of the musicians, comedians and presidents that once trod the boards of the iconic hotel.

The 1,000-room hotel in Hollywood, Florida, has changed hands a few times, most recently in an $835 million sale to a joint venture between Zurich-headquartered Credit Suisse Asset Management and Honolulu-based Trinity Investments in early February. The consortium purchased it from Toronto-based manager Brookfield, which paid $460 million for the property in 2014.

The deal, the largest for a US hotel since the covid-19 pandemic, puts it a long way from its humble beginnings. The original hotel was built in 1953, capitalized by Samuel Friedland, founder of the Pantry Pride supermarket chain. It was one of the first hotels to appear in the stretch between Miami and Fort Lauderdale.

Expanded in 1954 to 370 rooms, the hotel soon began living up to the ‘Hollywood’ in its address. Bing Crosby, Milton Berle, Joan Rivers, Sammy Davis Jr and Judy Garland all entertained guests there once upon a time. Jay Leno and Billy Crystal were once opening acts. On New Years’ Eve 1974, Frank Sinatra was even coaxed out of retirement for an hour-long performance at the hotel.

During the 1970s, however, The Diplomat evolved far beyond its status as a glitzy hangout. Harry Truman, and every US president since 1974, used the hotel as a meeting point with labor unions.

Fast-forward to the 1990s and the property was changed forever. The United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry purchased the building for approximately $40 million in 1997. The first institutional owner of The Diplomat demolished the original property a year later, reopening the structure that exists today in 2002 in the hopes of attracting more conference business.

Brookfield entered the picture in 2014, paying $460 million for the hotel. During its ownership, Brookfield invested $100 million into a 2019 renovation. The firm also switched the hotel’s flag from Westin, opting for Hilton’s upscale Curio brand. The new owners plan to further upgrade the property, moving it to Hilton’s more upmarket Signia collection when completed.

This latest transaction for The Diplomat has been hailed as a sign that business travel will return to pre-pandemic levels, with the beachside nature of the property coupled with its size a unique proposition in the US. Credit Suisse Asset Management and Trinity Investments’ conviction suggests that the evolution of the once-glamorous hangout still has a few stages left. 

1953: Original property opened as an Envoy hotel

1997: The United Association of Journeymen & Apprentices of the Plumbing & Pipe Fitting Industry buys property for $40 million

1998: The United Association demolishes original property and begins redevelopment

2002: Current iteration opens under Westin flag

2014: Brookfield buys property for $460 million

2019: Brookfield invests $100 million renovating building

2023: Brookfield sells hotel to a JV consisting of Credit Suisse Asset Management and Trinity Investments for $835 million