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1675-29 New Hotels mh95 AGREEMENT 07/13/1995 THE MIAMI HERALD Copyright (c) 1995, The Miami Herald DATE: Thursday, July 13, 1995 EDITION: FINAL SECTION: LOCAL PAGE: 1B LENGTH: 98 lines ILLUSTRATION: photo: the Royal Palm (a) SOURCE/CREDIT LINE: TONY PUGH Herald Staff Writer MEMO: see end of text for cutlines AGREEMENT EXPECTED ON HOTEL OWNED BY BLACKS After more than a year of roller coaster negotiations, the HCF Group is expected to finalize an agreement today for a black-owned hotel on Miami Beach. The pact, the fine points of which still were being negotiated Wednesday evening, calls for Dacra Development and Carnival Hotels & Resorts to join HCF as partners in an $18 million to $20 million renovation of the Royal Palm Hotel at 1545 Collins Ave. The project would restore the historic 56-year-old building to a 100- to 150-room, first-class hotel and make good on the most ambitious goal of the 1993 accord that ended Miami's black tourism boycott -- to develop a black-owned hotel on Miami Beach within three years. Local attorney and boycott leader H.T. Smith said even though the hotel likely will be half the size of the original 285 rooms proposed, it still will be symbolically important for South Florida's black community. "This is the most significant (real estate) development in black Miami since the Caleb Center was built, " Smith said, referring to the community center in the Liberty City area. Andy Ingraham, Florida marketing director for the National Association of Black Hospitality Professionals, agreed. "From an image standpoint, it will break the stereotype," Ingraham said. "For a long time people kept saying, 'It's a pipe dream. ' Now the dream is a reality, and others will see it can be done." A binding letter of agreement from all parties must be signed by midnight tonight for HCF to keep development rights for the hotel, said Arthur Courshon, of Miami Beach's hotel negotiating committee. That time period may be extended for a few weeks to resolve legal issues if necessary, but Courshon said that if the deal isn't concluded in full by then, other developers will be sought. "There will be an African American-owned hotel, whether it's HCF or not, " Courshon said. The deal would conclude a long, arduous and often disappointing process for HCF, a group of four local black developers headed by Peter Calin, an American Express executive. Other HCF principals include Argus Construction Co. owner Eugene Ford, Texaco tax attorney Jerry Bailey and local investor Marvin Holloway. HCF was awarded rights to the hotel project in 1994. The development -- which would sit just south of an 820-room Loews Hotel planned for 16th Street and Collins Avenue -- was specifically designated for black ownership. The city of Miami Beach agreed to purchase land for the project -- the Royal Palm -- for about $5.5 million. Original plans called for a 285-room, all-suite hotel operated by Sheraton. But after months of negotiations Sheraton backed out of the deal in March, leaving HCF with no chain to anchor the site. Tired of delays, the city commission gave HCF 90 days to ink a deal for the project. In recent months, negotiations with Westin, Marriott, Doubletree and other hotel chains for a similar development didn't materialize. Calin said each chain wanted more inducements from the city, which were not forthcoming. With no clear-cut plan, HCF had trouble attracting private investors and Calin said the group began to consider smaller, less-expensive developments. That's when Dacra Development, known for its Art Deco restorations of numerous South Beach properties, offered proposals to restore the eight-story Royal Palm. Calin said the expertise of Carnival Hotels & Resorts was necessary to manage the facility. Terms of the proposed agreement likely will provide Dacra and Carnival with a percentage of ownership, with HCF retaining a majority share. Craig Robins, president of Dacra Development, said the hotel probably will include an outdoor pool, restaurant and meeting space. He plans to get architectural and design ideas from a select group of young artists who incorporate the concerns of Miami Beach preservationists. "We're committed to producing a quality product that's unique and creative in a way that adds to what people call Miami style." Beth Mignon, a Carnival spokeswoman, said Wednesday that company officials could not discuss the project until the final terms were reached. CUTLINES:JON KRAL / Herald Staff AMBITIOUS PROJECT: The Royal Palm is the object of the HCF Group's plan for a Miami Beach hotel owned by blacks. * July 1994: Miami Beach Commission approves proposal by HCF Group to build a 265-room all-suites Sheraton Hotel at 15th Street and Collins Avenue. City agrees to purchase the land for $10 million. * March '95: Sheraton backs out of agreement to pay $8 million in exchange for operating and managing the hotel. Miami Beach commissioners grant HCF a 90-day extension to secure a contract with another hotel chain. * April '95: HCF negotiates with eight different hotel chains including Westin, Wyndham, Peabody and Doubletree. Group also considers proposal from Dacra Development for a smaller hotel project. * June '95: HCF requests and receives an extension until July 13 to reach written agreement for hotel project. Beacon Council provides HCF with $200,000 in venture capital funding to assist the hotel effort. * July '95: HCF on the verge of closing deal with Dacra Development and Carnival Hotels and Resorts on $18 million to $20 million restoration of the Royal Palm Hotel at 15th Street and Collins Avenue.