Colony Association, MW Group work on developer agreement

The Colony Beach & Tennis Resort Association is working toward an agreement with Longboat Key resident Manfred Welfonder’s MW Development Group to become the developer for the shuttered resort property.

Approximately 60 owners who attended a Colony Beach & Tennis Resort Association conference call board meeting March 26 learned the association is negotiating with MW, working with company developers Sigmund Levy and Kevin Daves to reach an agreement, according to association President Jay Yablon.

Yablon declined to comment about negotiations at this time.

Welfonder confirmed his company is negotiating to develop the resort.

“The MW Group is working with the association to move forward with an acceptable business deal which includes all respective stakeholders,” Welfonder said.

The news is a long time coming for Welfonder, who began his push to redevelop the Colony before the resort closed in 2010.

Welfonder said his top priority in the past seven years has been rebuilding the Colony, even though his company was previously passed over on multiple occasions.

MW’s plan calls for the construction of 160 hotel units built in one or two mid-rise buildings developed and/or managed by an international hotel company and owned by the developer; the construction of 180 vacation ownership units/residences; 10 private residence clubs; and a three-meal restaurant, pool bar, ballroom, meeting rooms, spa, Har-Tru tennis court and an agreement with nearby golf courses allowing for the use of facilities.

That projects includes the following redevelopment options owners can consider:

• One-13th co-ownership at no cost to current owners and prices for units ranging from $99,000 to $179,000 for new buyers;

• A 100% ownership option available for current owners that costs between $331,000 and $686,000 per unit;

• Current owners can also walk away and receive a buyout of $75,000 to $85,000.

Welfonder has pitched the project to any unit owner who has been willing to listen over the last seven years. His company has also been in the midst of settlement negotiations with Colony affected parties for years.

“We are confident our settlement offers will be accepted at some point,” Welfonder told the Longboat Observer in June 2013.

MW pitched a redevelopment proposal in 2008 and has been a part of two failed settlement negotiations.
The project received support but fell to the wayside amid lawsuits and bankruptcy filings. Many Colony owners at the time still believed all existing buildings could be saved.

Welfonder said there is not a proposal that was considered in the past that is as detailed as MW’s proposal.

Yablon and Welfonder declined to discuss at this time what led both sides to come close to reaching an agreement. Less than a year ago, Yablon denounced MW’s proposal after the association selected JHM Financial Group LLC last summer to redevelop the resort.

Asked to comment on MW’s proposal in June 2013, Yablon said:

“Manfred Welfonder is simply a broker who does not himself bring the capacity to the table, nor has he proved or divulged from where he would get the capacity, nor is there any evidence provided to the association that some entity with sufficient capacity would actually underwrite the supposed great deal from MW Development Group.”

Welfonder said he has three letters of intent with contingencies from private and/or corporate sources for both equity and debt.

His company has brought in local partners such as Sarasota professional planner Bruce Franklin and former town building official Randy Fowler to work to obtain 155 additional tourism units if the project was selected.

MW also hired a construction management company to guarantee a project cost estimate of $155 million and three hotel partners that guarantee at least a 62% or higher occupancy rate. The company also has a franchise agreement with Intercontinental Hotel Group to use its reservation system.

COLONY OWNERS FILE LAWSUIT
Colony Beach & Tennis Resort unit owners Sheldon and Carol Rabin officially filed a lawsuit Tuesday against the Colony Beach & Tennis Resort Association and its board members for its failure to maintain the resort’s common elements, which include all walls, plumbing and wiring.

The complaint seeks “equitable relief in the form of a mandatory injunction, and, in the alternative, the appointment of a receiver to assume the operation of the association.”

In an email to the Longboat Observer, Sarasota Attorney Alan Tannenbaum of Sarasota-based Tannebaum & Hanewich wrote: “I have been practicing law in the condominium field in Florida for 35 years. Never have I witnessed a Board of Directors of a condominium association proceeding on such a reckless course to the detriment of its members. This suit seeks to require the board to undertake necessary repairs and fight for the preservation of the condominium buildings or for the court to appoint a receiver to do so if the board refuses to act. The board will argue that the buildings and improvements are not salvageable. Engineering reports provided to the board by local engineers three years ago stated otherwise and those very same engineers are ready to go to work today to preserve all 237 units.”

Contact Kurt Schultheis at [email protected]