1621-2 Royale Group TAG: 9204280561
6 of 283, 4 Terms
mh ART DECO HOTELS ON BLOCK 01/30/1992
THE MIAMI HERALD
Copyright (c) 1992, The Miami Herald
DATE: Thursday, January 30, 1992 EDITION: FINAL
SECTION: BUSINESS PAGE: 1C LENGTH: 81 lines
ILLUSTRATION: photo: Leslie Hotel (n) , The Flambeau (n) , the Victor
(n) , CARDOZO hotel with Cavalier hotel, CARLYLE HOTEL; map:
hotel sites
SOURCE/CREDIT LINE: BEATRICE E. GARCIA Herald Business Writer
ART DECO HOTELS ON BLOCK
HISTORIC SITES
TO BE AUCTIONED
Five hotels on Miami Beach's Ocean Drive, considered Art Deco landmarks,
will go on the auction block in March.
The hotels -- the Cavalier, Cardozo, Carlyle, Leslie and The Victor --
are considered among the most architecturally significant buildings witkin the
city's national historic district. Their restoration kicked off the
renaissance of South Beach in the mid-1980s.
But in recent years, a cloud has hung over these properties. Their
ownership was tangled in foreclosure and bankruptcy proceedings for nearly
three years.
Also, Leonard Pelullo, chief executive of the Royale Group, which
controlled 13 hotel and apartment properties in the Art Deco district
including these five hotels, was convicted last year on federal racketeering
and wire-fraud charges for misappropriating $2.2 million from a California
thrift and the Royale Group. Pelullo was fined $4.4 million and is serving a
24-year prison sentence.
"People have been anxiously awaiting the disposition of the Royale
properties, " said Saul Gross with Streamline Properties in Miami Beach.
Local real estate developers as well as preservationists would be glad to see
these hotels purchased by financially solid owners so that their refurbishing,
which has been stalled, continues.
The seller is New West Federal Savings Bank, based in Irvine, Calif.,
which is liquidating the assets of the California-based American Savings &
Loan Association, seized by federal regulators in late 1988.
Starting in 1983, the Royale group borrowed $28.3 million
from FCA Mortgage Corp., a subsidiary of American Savings, to buy and
refurnish the hotels. By the time FCA Mortgage was allowed to complete the
foreclosure of the properties in 1990, the debt totaled more than $38
million. Although real estate investment has slowed dramatically since the
tax laws were changed in 1986, South Beach is hot. Miami Beach brokers said
German and French investors are shopping around for properties in South
Beach.
Foreign buyers might have an advantage in bidding for these properties
because they may have more access to financing. Also, foreign currencies are
stronger when compared to the U.S.
dollar.
"There are local buyers who are interested, but there's no local
financing, " Gross said.
ammmmmmmm
embraced his weeping wife, Susan, and other family members and began some
hurried goodbyes. He handed his wallet, pens, tie-tack and other jewelry to
family members as deputy marshals took his arms to lead him from the
courtroom.
Outside the courtroom, Michael Ryan Barrett, Pelullo's attorney, declined
to speak with reporters and walked off with Pelullo's family.
The prosecutor, Assistant U.S. Attorney Ronald G. Cole, praised the
sentence. Referring to Pelullo's squandering of money borrowed from the failed
American Savings & Loan of Stockton, Calif., purportedly to renovate the Art
Deco hotels, Cole called him "one of the worst examples of the excesses of the
'80s. And now the taxpayers are stuck with this."
The hotels Pelullo owned at the time -- including the Carlyle, Cardozo
and Victor -- were sold last year at a foreclosure auction.
The 24-year sentence ensures that Pelullo must serve at least eight years
before becoming eligible for parole. In addition, Kelly signed a $2.2 million
restitution order agreed to by Pelullo after his July 3 conviction on
racketeering and wire-fraud charges. The money will come from the sale of
Pe1011o's horse farm in Pennsylvania and a Montana sheep ranch, Pelullo's
current home in Miami, and a Miami hotel and apartment house.
Kelly said $2.071 million will go to New West Federal Savings & Loan, the
successor to the failed American S&L, and $114,000 to Royale Group to
reimburse the company for money Pelullo was convicted of siphoning off to
repay a loan shark after the then-head of the Philadelphia mob, Nicodemo
Scarfo, demanded that Pelullo repay the debt.
TAG: 9102270042
11 of 283, 4
12 of 283, 2 Terms
mh DEVELOPER PAYS $2.4 MILLION FOR TIDES 06/06/1991
THE MIAMI HERALD
Copyright (c) 1991, The Miami Herald
DATE: Thursday, June 6, 1991 EDITION: FINAL
SECTION: BUSINESS PAGE: 1C LENGTH: 46 lines
ILLUSTRATION: map: Location of The Tides Hotel
SOURCE/CREDIT LINE: AARON S. RUBIN Herald Staff Writer
DEVELOPER PAYS $2.4 MILLION FOR TIDES
The Tides Hotel in Miami Beach, a 10-story Axl. Deco building on Ocean
Drive that has been mostly vacant for three years, has been sold for $2.4
million to a company planning a major overhaul.
South Beach Equities Inc. , an affiliate of Island Trading Co., on Tuesday
purchased the Tides, 1220 Ocean Dr. The company also bought the Molinar Hotel,
a small Art Deco property directly behind the Tides at 1221 Collins Ave. , for
$700,000
from Ocean Properties of Delaware.
Both properties were assets in a bankruptcy case involving Miami Beach
developer Leonard Pelullo.
The properties were assessed together at about the $3.1 million purchase
price, said Craig Robins, president of Dacra Development Corp., which will
develop the Tides and Molinar.
Both hotels were owned by Ocean Properties of Delaware Inc., a Pelullo
family trust, said examiner Jeffrey Beck. The Royale Group, headed by Pelullo,
owned many Art Deco properties but lost them last year in a foreclosure
auction.
A commercial photography lab has been operating out of the Tides lobby
for nearly two years, but otherwise the building has remained empty. Jeff
Greene, president of Island Trading, said his company purchased the properties
to expand its participation in the renewal of South Beach. "We are strong
believers in the vitality and future of a quality-developed South Beach, " he
said. "It's a community that's got a wonderful spirit growing inside, and we
want to be part of the long-term growth of that spirit."
Greene said plans are still being considered for the proposed
renovations.
Dacra and Island Trading have been working together to convert the Marlin
Hotel, at 12th Street and Collins Avenue, into a technologically advanced
recording studio, restaurant and 14 upscale condominium units, Dacra President
Robins said.
After it is renovated, some aspects of The Tides will resemble the
Marlin, which is scheduled to open in the fall, he said. "The Marlin is
basically the prototype," he said. "Our desire is to focus on these other
properties and just come up with a plan that will offer the type of quality
uses that we believe is the future direction of this community."
KEYWORDS: COST
TAG: 9102070563
15 of 283, 2 Terms
mh CARLYLE GRILL CLOSES ITS DOORS 05/23/1991
THE MIAMI HERALD
Copyright (c) 1991, The Miami Herald
DATE: Thursday, May 23, 1991 EDITION: FINAL
SECTION: NEIGHBORS MB PAGE: 3 LENGTH: 52 lines
ILLUSTRATION: photo: Carrlyle Grill at the Carlyle Hotel
SOURCE/CREDIT LINE: BETTY CORTINA Herald Writer
CARLYLE GRILL CLOSES ITS DOORS
The Carlyle Grill, the trendy Ocean Drive restaurant that attracts Miami
Beach movers and shakers, last week shut its doors for the summer.
Stuart Borenstein, who leases the space from the Carlyle Hotel at 1250
Ocean Dr., said the eatery needs plumbing and oth%r general repairs. He said
he and the hotel's management company, Tecton Management Co., prefer to
complete the repairs and close the restaurant during the off-season, when
business is slow.
For Miami Beach hoteliers and restaurateurs, business is usually best
between September and April, Borenstein said.
"We just need to do a little renovating," he said. "We'll be back in
business in September."
This isn't the first time the Grill has shut down to freshen up. In 1984,
the-then owner, The Royale Group Ltd.,
closed it for major renovations. In 1985 and 1988, the restaurant closed for
minor renovations. Each time, the restaurant reopened in the fall.
Borenstein said the closing of the Carlyle Grill has nothing to do with
its history.
"All business is slow in the Beach now, " Borenstein said. "It's the
off-season. When the season comes around we'll be open and do business as
usual."
4