The Colony Beach & Tennis Resort Association board voted Wednesday night to enter into a nonbinding memorandum of understanding with longtime unit owner Andy Adams’ BreakPointe LLC and the Naples-based Coral Hospitality LLC.
The agreement approved for the $40 million revitalization of the resort would primarily involve renovation/rehabilitation of existing units, according to board president Jay Yablon, although some units may need to be rebuilt.
Development would begin with the approximately 15 acres currently controlled by the Association and proceed to the remaining three acres controlled by longtime Colony owner Dr. Murray “Murf” Klauber entities if possible.
Adams owns at least 48 Colony units both personally and through his Colony Beach Investors LLC, according to property records, along with an undivided 5% interest in the three-acre recreational property. His company, AdamsMark L.P., was one of four finalists during the board’s initial selection process, which ultimately led to an agreement with the Broomfield, Colo.-based Club Holdings Ventures. The board and Club Holdings agreed to terminate the relationship last May, in part because of Club Holdings’ concerns about the scope of litigation.
Adams is the retired CEO of National Health Investors Inc., a real-estate housing trust that manages publicly traded senior housing companies.
Coral Hospitality was founded in 1988 by John Ayres, chairman, who, 11 years later, partnered with CEO Lee Weeks.
The company’s recent projects include the management of the Sandpearl Resort on Clearwater Beach after its 2005 opening, the two-year, $12 million renovation of Casa Ybel Resort on Sanibel Island, and the management of the Gansevoort Miami Beach hotel in 2010 after Credit Suisse foreclosed on it.
BreakPointe will serve as developer and recommend a plan to the Association, while Coral Hospitality would take the role of property/resort manager and technical developer, operating under BreakPointe.
Both BreakPointe and Coral Hospitality will also enter into settlement negotiations on behalf of the Association to resolve the legal disputes surrounding the property.
BreakPointe can provide a $20 million letter of credit to show an immediate source of committed cash, according to the memorandum. The company will also commit at least $1.4 million to acquire units from owners who want to sell, with Coral Hospitality possibly buying units above BreakPointe’s program. BreakPointe will also make $9 million available to owners for mortgage financing.
The agreement comes as legal issues surrounding the property continue to loom.
U.S. Bankruptcy Judge K. Rodney May has not yet ruled in three separate cases involving the property, and on Tuesday, Sept. 4, the Association will go before the Longboat Key Town Commission to ask for an extension of a Dec. 31 deadline for re-opening the resort as a tourism property.
According to Yablon, Adams and Coral Hospitality representatives will both attend the meeting.
Before that, on Tuesday morning, Association, Adams and Coral Hospitality representatives will meet with Klauber to discuss settlement.
“Working with Coral Hospitality, the Association has reached out to Murf Klauber and his family, the bankruptcy Trustee and Colony Lender to tr to put the legal disputes behind us,” Yablon said in a prepared statement. “We are hopeful that we will have a settlement in the coming days, without which we will be forced to proceed without these valuable players. We and the Association’s new partners are prepared to make concerted efforts to reach fair and equitable agreements with all the stakeholders.”
“…It is well past time to end the disputation and move forward for the benefit of everyone involved including our good neighbors on the Key who have rightly grown weary from the spillover of the Colony’s internal melodrama. To every stakeholder at The Colony, it is no longer just about our own internal disputes…our neighbors have just about had it with all of us.”
The extension of the re-opening deadline will be discussed in a quasi-judicial hearing at the 7 p.m. Tuesday, Sept. 4 commission meeting at Longboat Key Town Hall, longboatkey.org.
For more information, pick up a Sept. 6 copy of the Longboat Observer.
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