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The former Helmsley Sandcastle Resort opened in 1953.
Sarasota Thursday, Mar. 2, 2017 3 years ago

Ocean Properties to redevelop Lido Sandcastle

The 64-year-old former Helmsley Sandcastle Resort on Lido Key will be redeveloped into 304 rooms in two high-rise towers.
by: Kevin McQuaid Commercial Real Estate Editor

One of Florida’s largest hotel owners plans to redevelop the former Helmsley Sandcastle Resort in Sarasota and add 128 rooms to the beachfront property.

Ocean Properties Hotels Resorts & Affiliates seeks to raze the existing hotel, completed in 1953, and build a 304-room hotel and related space in a pair of towers slated to rise nine and 10 floors, according to a development documents submitted to Sarasota city officials. 

“In order to be competitive, they need to update the hotel and make it a more contemporary beach resort,” says Bruce Franklin, president of Land Resource Strategies, the real estate consulting company working with Ocean Properties on the proposal.

The new hotel, on 6.1 acres on Lido Beach, could be completed in 2019, if required approvals from the city are forthcoming.

Franklin says the new 1540 Benjamin Franklin Drive hotel would also offer roughly 20,000 square feet of meeting, ballroom and restaurant space.

Ocean Properties, which acquired the 176-room Lido Sandcastle in February 2014 for $27.4 million, has requested a pre-application meeting with Sarasota’s Development Review Committee, according to its city filing.

The new hotel is being designed by Nichols Brosch Wurst Wolfe & Associates Inc.

The Lido Key Residents Association will hear a presentation on the plans from Ocean Properties Vice President Mark Walsh at its March 18 meeting. When the developer purchased the property in 2014, residents expressed concern the hotel would be razed and replaced with a condominium tower, according to Carl Shoffstall, president of the Lido Key Residents Association.

Shoffstall said the organization hasn’t had an opportunity to meet to discuss the proposed redevelopment, but a hotel is likely to generate less controversy than a residential project. He recalled a conversation he had with Visit Sarasota County President Virginia Haley, who said she didn’t want to see Lido turn into a largely private island without places for visitors to stay.

“We’ve been losing a lot of hotel rooms over the years,” Shoffstall said. ”A lot of people say we need more hotel rooms on Lido.”

The Sandcastle has a colorful history on the island — including a period of time from 2007 to 2011 when the property was owned by a dog, who inherited the hotel from real estate mogul Leona Helmsley after her death. Despite its connection to the community, Shoffstall said the building itself hasn’t necessarily held up over the years. 

“It’s dated, man,” Shoffstall said. “It’s not a historic building or anything like that, and it does need a lot of work. It was the place to be on Lido at one time, but that time has come and gone.”

Ocean Properties’ plans come as roughly 1,000 hotel rooms are being constructed or planned in downtown Sarasota. 

Franklin, in an interview with the Business Observer, says Ocean Properties’ proposal likely won’t be affected by the new rooms downtown, the majority of which are expected to open for use by 2018.

“Downtown and Lido Beach are truly two different markets,” Franklin says. “The beach is much more tourist-oriented, whereas downtown tends to be more of a business market.”

Ocean Properties’ officials could not immediately be reached for comment on the proposal.

In all, Ocean Properties owns more than 100 hotels containing 17,000 rooms throughout North America, according to its website.

In Florida, the company owns the Lido Beach Resort; The Resort at the Longboat Key Club; Sanibel Island Beach Resort; the Edgewater Beach Hotel in Naples; and the Holiday Inn Lido Beach, among other hospitality properties.

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