Future of SoBe Hotel Not Such a Shore Thing
The Shore Club is a little behind on their $111.5 million mortgage
Shore Club
We'd forget to pay our mortgage if this was our pool.
Is the pool party over at the Shore Club?
The posh SoBe boutique hotel, which can claim such famous guests as Paris Hilton, is a little behind on their $111.5 million mortgage, according to the Wall Street Journal.
This month, the hotel's mortgage -- which owners Philip and Michael Pilevsky took out in 2005 when the hotel was valued at $176 million -- will be 30 days late, which doesn't include the $11.5 million in other acquired debt.
A spokesperson for the Pilevskys told the Journal that the owners are trying to resolve an issue about funding obligations for renovations that are currently taking place with Cerberus Capital Management LP's LNR Partners Inc., which agreed to fund payroll and critical expenses.
The hotel -- whose occupancy was down about 10 percent and revenue per room was down about 100 bucks in the second quarter from the same time last year -- is just one more in the line of SoBe hotspots that have gone from Penthouse to Standard Room next to the stairs concerning their financial sitches.
The Fontainebleau's Las Vegas outpost has filed for bankruptcy, while hotelier Andre Balazs recently sold The Raleigh, arguably the most charming hotel gracing Collins Avenue.
Perhaps the influx of big-name events this season will inject some much-needed life into Hotel Row. Art Basel will return in December, followed by the Pro Bowl, Super Bowl and South Beach Wine and Food Festival.
After all, what would South Beach be without this?
Posted Wednesday, Oct 21, 2009 - 3:36 PM EST
