BELLEAIR — The prospective owners of the Belleview Biltmore hotel, once hailed as saviors who would restore the deteriorating landmark to its former splendor, will be not be closing on the property this week — or perhaps ever.
And to make matters even more ominous for the "White Queen on the Gulf," current property owners Raphael and Daniel Ades are requesting approval to demolish it.
Not only that, the brothers are asking the town to release the lien on the Cabana Club and Belleview Biltmore Golf Club properties. If the town doesn't comply, their attorney warned, a foreclosure could be initiated and the town could lose more than a quarter-million dollars in fines.
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Mayor Gary Katica said things were getting "a little ugly."
According to Katica, Raphael Ades recently told commission members (in individual meetings) he didn't think Coral Gables architect Richard Heisenbottle and partners Hector Torres and Charles Kropke (a.k.a. the Belleview Biltmore Partners) were going to be able to obtain the financing for the hotel.
"He (Ades) said he didn't want to delay any longer and would be filing for a permit to demolish," Katica said. The owners had filed a request to demolish in January but the application was deemed incomplete.
On Sept. 21, the town received a five-page cover letter along with the application to destroy the massive 115-year-old wooden structure.
The letter, written by the owners' attorney, states that the Belleview Biltmore Partners were unable to close on the loan and are in default of the contract. (Heisenbottle and his team bought the hotel in March and were given six months to close.)
The letter argues that "restoration is simply not achievable, regardless of our desire to change that reality." It cites a study that says the hotel would compete poorly because of its non-beachfront location, limited on-site amenities, lack of nearby attractions and recreational venues, and location within a residential community.
When contacted by phone, Heisenbottle would not comment on the failure to close, outlook for financing or plans to restore the hotel.
"I will only tell you that the present contract expires on Friday and I just had a meeting with Daniel Ades and we are in the process of renegotiating an extension for the contract," he said.
Luciano Lautenberg, director of marketing for Kawa Capital Management, a Miami-based asset management firm founded by Daniel Ades and Alexandre Saverin, said, "We are in the middle of negotiations and cannot comment at this time."
The letter of application gives a Dec. 31 deadline for Heisenbottle or any prospective buyers to close on the property before demolition occurs.
It also says the owners plan to apply for a zoning change to allow residential development of the property.
And, it states the owners plan to seek removal of the hotel's historic designation. The 820,000-square-foot structure has been on the National Register of Historic Places since 1979.
Recently Heisenbottle and his group asked the town to approve a highly contentious tax exemption for renovations on historic commercial properties — such as the Biltmore — saying it was needed to make the project financially feasible.
The town was divided with preservationists on one side and those who feared the town would go belly up from losing a potential $5 million in tax revenues on the other.
A month ago, the Town Commission approved the ordinance by 3-2. Now that it is enshrined in town law, it may all have been for naught.
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During a Tuesday work session, Ray Allen, an attorney for the owners, asked the town to grant a partial release of liens for the Cabana Club and golf course. The town's Code Enforcement Board has imposed a $250 per day fine as a result of hotel code violations ever since the previous owners, Legg Mason, were involved. When the Ades brothers bought the three properties the lien was attached to all three.
As of Wednesday, the fines had accrued to over $266,000, said assistant town manager J.P. Murphy.
If the town won't release the two properties from the lien, the owners say they could begin foreclosure proceedings. If the first mortgagee (Kawa) is the successful bidder, the amount of the lien would be cancelled with no payment to the town since the town is considered the secondary lien holder.
However, the attorney offered that if the town releases the lien on the Cabana Club and golf course, the town would be given the right to collect the lien money when the hotel is sold.
The Town Commission is working on a counterproposal.
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In the meantime, Katica and plenty of others worry about the fate of the Biltmore.
"It's on 23 of the finest acres in the state of Florida," said Katica. "It's 45- to 50-feet above sea level and in a private community. It's worth more to the Ades brothers if the hotel isn't on it. But the best thing for the town is if the Belleview Biltmore is restored.
"I have strong feelings for the people that are true preservationists and have to see this process unfolding in front their eyes. Some are so into it they would lie down in front of a bulldozer."