Though the tourism and hospitality market is beginning to recover, the financing market for hotels remains challenging and it’s caught the owners of the Sanctuary Hotel short. Entities controlled by the Menin and Galbut families, which sold the Sanctuary Hotel-Condominium to an LLC led by Blue Road partners Marcelo Tenenbaum and Jorge Savloff, filed a foreclosure lawsuit seeking $9.5 million plus interest from the new owners.
Blue Road, a locally-based hotel investment, development, and management firm, bought the Sanctuary at 1745 James Avenue through an investment group known as 1745 James LLC in August 2019. According to the filing in the Eleventh Judicial Circuit Court of Miami-Dade County, the investment group financed the transaction with two notes from the prior owners, the first for $7.5 million maturing on August 15, 2022 and the second for $2 million maturing on August 15, 2020. Monthly payments on both notes were scheduled to begin in September 2019.
An April 2020 modification to the notes provided some relief on payment of outstanding interest and extended the maturity date of the smaller note until December 2020. The maturity date of the larger one remained the same.
According to the court filing, 1745 James LLC is in default of both notes, failing to make payments starting in February on the $7.5 million note and all payments on the $2 million note since December 2020.
Tenenbaum, a Miami Beach resident, told RE:MiamiBeach, “We are trying to resolve the situation with the lender, trying to get new funding to make an arrangement with the lender as a result of the difficulty created by the pandemic.”
Tenenbaum and Savloff have approved plans to demolish the old Sanctuary Hotel building which has been closed since Hurricane Irma and construct a new five-story hotel with 90 rooms and a food and beverage component.
Other Blue Road properties in Miami Beach include the Redbury, Aqua, and Berkeley Hotels. Their recently renovated Berkeley Park Hotel, the former Sadigo, reopened early this month under the Accor MGallery brand.
Rendering: Revuelta Architecture
Foreclosure Action Filed Against Investment Group that Purchased Sanctuary Hotel-Condominium in Miami Beach
Foreclosure Action Filed Against Investment Group that Purchased Sanctuary Hotel-Condominium in Miami Beach:
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