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Discussions stretched for 15 hours Saturday and another eight hours Sunday.
But, by Sunday night, when the nine board members of the Colony Beach & Tennis Association voted, their choice for the company to redevelop the historic resort, which has been shuttered since August 2010, was unanimous: Broomfield Colo.-based Club Holdings LLC.
Colony unit owners were notified of the decision Tuesday morning in an email from board President Jay Yablon. He described the search process that began October 2010 with 16 candidates and eventually was narrowed to four plans: those presented by Club Holdings LLC; Colony unit owner Andy Adams and his AdamsMark LLC; Arendee Colony, represented by Randy Langley and David Siegal; and Naples-based Coral Hospitality.
“It has been a long year of intensive, albeit quiet groundwork,” Yabon wrote, “but one which has been highly productive and will yield dividends for future generations of Colony owners and guests to come.”
The company chosen by the board is the parent company of three major vacation networks — the Quintess Collection, DUO by Quintess and the Tour Club. In August, Club Holdings Chief Executive Officer Pete Estler compared his company to “a hotel that operates around the world.”
Estler did not return a call from the Longboat Observer seeking comment. But in August, he and co-founder Ben Addoms said their company has grown since its inception in 2004 to include more than 350 residences in 40 locations and eight countries throughout the world. To develop their proposal for the Colony, they partnered with the Windemere-based Miller Group Development, which was founded by Glenn Miller, an original owner at the Colony who arranged the original financing for the resort and owns a unit today at Grand Bay.
But as plans for redevelopment move forward, legal issues remain. Among those affecting redevelopment plans is the matter of Dr. Murray “Murf” Klauber's ownership stake in a recreational lease that controls the Colony's tennis courts and other amenities.
Adams owns a 5% interest in the Colony's recreation property. Siegal and Langley, who purchased $10 million in overdue bank loans and are now foreclosing upon and have a lien on 100% of Klauber's Colony properties, also own a first mortgage on Klauber's 80% of the recreational properties and own by deed a 15% interest in the recreational properties. Both parties continue to await a ruling from U.S. District Judge Steven Merryday, who, in July, reversed 2009 bankruptcy rulings made by U.S. Bankruptcy Judge K. Rodney May.
Klauber's attorney, Charles Bartlett, said that he doubted the association could proceed until pending legal matters are resolved.
“Although it is, perhaps, important, it doesn't do anything in terms of advancing the development itself,” he said.
Yablon declined to comment about any pending legal issues. But, he described the Colony's future, saying:
“The Colony will continue to be an owner-based condominium resort, fully open to the general public but upgraded to 21st-century facilities, amenities and hospitality services.”
To move forward with redevelopment, 75% of unit owners must approve the project. “The proposal is excellent,” Yablon said of the Club Holdings proposal. “We will make certain that it is attractive to at least 75% of our owners.”
Klauber urges owners to go with ex-Ritz team
'The day that West Paces ... re-opens our beloved Colony will also be the day that I will gladly and proudly retire ... ” Murf Klauber said.
Still determined to see the Colony Beach & Tennis Resort revived in his vision, longtime Colony owner Dr. Murray “Murf” Klauber said Tuesday the unit owners' board of directors “has no right to make a decision” on what company redevelops the shuttered resort.
And in response to the association's announcement that it had selected Club Holdings Inc. to redevelop the Colony, Klauber released to the Longboat Observer a letter he has prepared to send to Colony unit owners, urging them to select Atlanta-based West Paces Hotel Group Inc. as the redeveloper.
West Paces is the worldwide luxury-resort developer and operator headed by Horst Schulze, former president and CEO of the Ritz-Carlton Hotels from 1982 to 2002.
“We must have really sophisticated, seasoned, luxury, simple elegance,” Klauber said Monday, adding he believes Schulze's company can execute that better than any of the other contenders vying for the Colony project.
In his prepared letter — “you as investors,” Klauber wrote — he outlined three financing options for them to consider if they were to opt for West Paces. In addition, he pledged:
“I submit to those without any hesitation that the day that West Paces Hotel Group re-opens our beloved Colony will also be the day that I will gladly and proudly retire from management and operations.”
Klauber's financing options included:
• Option A — Self-financing. He said the Colony renovation would total roughly $33.2 million, or $140,000 per residential unit. “For unit owners who have the means and desire to fund individually and independently their pro-rata share of these improvements, they can contribute this amount and enter into the resort's rental program.” That would allow unit owners to share in the revenues of their units.
“Unit owners electing this option will also enjoy the use of their unit for personal use up to 30 days per year to use in similar fashion” as before.
• Option B — Sale. For unit owners who wish to sell, “we will offer to buy your unit at the lesser of appraised value or $50,000.”
• Option C — Exchange. For unit owners who wish to continue the 30-day rent-free use of their units, as they previously did, but who do not want to or cannot make a capital contribution, “we will offer the opportunity to exchange a fractional deeded interest in a fully renovated and equipped unit ... in exchange for the full-ownership deeded interest of their unit.”
Fractional owners “will have the same rent-free rights as they previously enjoyed but will be subject to their pro-rata share of assessments under the condominium declaration ...”
Told of Klauber's letter, Jay Yablon, president of the unit owners association, declined to comment. Officials from West Paces Hotel Group did not return the Longboat Observer's calls.
-Robin Hartill, Longboat Observer
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