Colony Association, Club Holdings end agreement

The Colony Beach & Tennis Resort Association board voted unanimously Monday, May 14 to end its development agreement with Club Holdings Ventures LLC.

The board’s president, Jay Yablon, wrote last week in an email to unit owners that the Broomfield, Colo.-based company had expressed an interest in terminating the agreement.

The contract that the Association and Club Holdings entered into during the annual unit owners’ meeting April 2 and April 3 allowed either party to terminate the agreement within 45 days, without penalty, meaning that either party had until the end of Tuesday, May 15 to walk away.

The vote took place at 8 p.m. Monday via a conference call in which 50 to 60 unit owners participated. By 8:20 p.m., the board had voted to end the agreement.

Although Club Holdings had been open to discussing a new arrangement, Yablon said that the Association does not plan to renegotiate the agreement — for the time being, he emphasized.

Yablon told the Longboat Observer that Club Holdings expressed interest in ending the agreement because the situation was “too much of a mess.”

“Because it was so messy, they felt like it wasn’t something that they could keep investors interested in with so much dysfunction,” he said.

The ingredients of that dysfunction include a myriad of legal issues that appear no closer to resolution, with three separate hearings scheduled for Friday, July 13 in U.S. Bankruptcy Judge K. Rodney May’s courtroom and a warning delivered by several town commissioners in March that they would be unlikely to agree to another extension of the property’s tourism use if the parties don’t reach a resolution by the end of the year.

Additionally, there was growing strife between owners of the Colony’s 237 unit owners, many of whom disagreed about whether a rebuild of the property was necessary and questioned the costs of Club Holdings’ proposal. The board is currently finalizing the results of a straw poll of unit owners that included a question about whether they would vote “yes,” “no” or “undecided” on the proposal if they had to vote that day. The proposal would have likely gotten support from a majority of unit owners but likely would not have reached the 75% approval needed for any plan to move forward.

The Association will most likely take a few weeks to determine how to proceed, according to Yablon, who said that discussion about the property’s future stretched until nearly 11 p.m. Monday night. Unit owners discussed a variety of options, including soliciting other proposals and possibly re-opening some units in the short term.

The Association chose Club Holdings as its development partner last September. The plan the company proposed offered unit owners options of whole ownership, one-eighth ownership or selling their units.

Klauber Comments:
Longtime Colony Beach & Tennis Resort owner Dr. Murray “Murf” Klauber gave the following written statement to the Longboat Observer:

“I was saddened and totally distraught upon leaving the meeting Monday night. This entire fiasco is humiliating and has been a total waste. The time consumed and monies spent accomplished nothing.
“We now need leaders experienced in the hospitality field beyond this board’s capabilities.

“In the past six years the Colony Beach & Tennis Resort has greatly deteriorated. The financial impact to the town of Longboat Key, the unit owners, Sarasota, the 350 employees and the thousands of guests has been catastrophic.

“There has not been a single positive result under their leadership. This recent failure has once again left the owners empty-handed.

“I believe that The Colony has a simple solution. We have the ability to welcome Horst Schulze, the former creator of the Ritz-Carlton, who went on to build 60 more of that luxury brand. He has assembled all of his previous associates from the Ritz and has created The Capella Hotel and Resorts. They have built 40 of the finest upscale resorts and hotels in the world —in Singapore, China, Italy, St. Petersburg, Russia, United States, Europe, etc. Horst is truly interested in simple beach elegance on Longboat Key. This group has the capability of rebuilding and refining The Colony back to a fun, fine, exciting resort. They also have the unsurpassed international client-base and marketing acumen that will sustain Colony occupancy year round. They are an experienced, knowledgeable beach construction company. The Capella Group is ready, willing and able to start performing very soon.

“I am now so pleased that a new voice of owners wishes to be heard. This group of owners is now speaking out and standing up to support this new pursuit as well as studying and considering past development proposals.”