Gansevoort South Strikes Back at New Owners and Management

February 5, 2010 at 2:28 PM | by juliana | Comments (4)

Times are hard for the Gansevoort South in Miami Beach. At least behind the scenes. Back in December, it was announced that Gansevoort was having trouble meeting its mortgage payments with the lender Credit Suisse who in turn was going to put the hotel on the auction block on January 28.

But now it looks like Credit Suisse is the new owner of the hotel and they want to remove the Gansevoort management group from the hotel but still keep the name, Gansevoort.

Of course, the Gansevoort Hotel Group isn't going to take this lying down. The group filed a suit today against Column Financial, an affiliate of Credit Suisse, arguing that Column does not have the right to terminate their management contract nor can they hire an inadequate management company to run a hotel using the Gansevoort name.

A statement from the Gansevoort Hotel Group's, Michael Achenbaum, says:

Though Gansevoort South is profitable, and amongst the leaders in its competitive set, Column and its affiliates are attempting to violate a legally binding agreement as retribution for the failure of the condominium element of the project. Obviously, they see the value we have created as they have in writing stated that they intend on capitalizing on our brand name. The apparent successor in the managerial role leaves us concerned that future Gansevoort South guests will be disappointed with the quality of their hotel experience compared to what they have come to expect at a Gansevoort property. We sought to reach an amicable solution with Credit Suisse and we will continue to do so.�

As for the "apparent successor" it looks like it will be a Florida firm that has a handful of very low-profile hotels and resorts. They also manage golf clubs, spas and residences throughout Florida but nothing in Miami and nothing on the scale of the Gansevoort. In short, this would be a huge "get" for their portfolio if they could manage the Gansevoort South.

But we really dislike it when the folks running hotels use the name of another brand (hello Setai San Diego) as guests are paying for a known experience and shouldn't be tricked into believing the hotel is something it's not. Hello, this is the hospitality industry, isn't it?

In the meantime, it looks as if the Gansevoort Park Avenue is still on. A recent NY Times article said it was schedule for June. We'll keep our eyes on that.

Anyone have any more scoop on what's going on with Gansevoort South? Have the new owners fired or hired people? Is the nightlife buzz still the same? Send us your tips or put them in comments below. Anonymity assured.

[Photo: Kokkofish/HotelChatter Flickr Pool]

Comments (4)

Return to » Gansevoort South Strikes Back at New Owners and Management

The idea that the bank is wanting to dissolve a legal contract is a joke, the developers formed a company with no management experience paying themselves 4 times what the property's former management company was charging and let the property look like a dump! (while not paying their bills)

Any judge would throw their lawsuit out! Thank God the bank took over and this outrageous nepotism can stop!!!

- Owner of the Roney Condo portion of the property

The management group has been paying themselves huge amounts of money and giving little or no management. Getting rid of these pretenders would improve the property.

Condo owner

It is presumptuous to suggest that another management company could not do, at least, as good a job as the company currently "mismanaging" the property. KOS Management (which just so happens to be owned by a Gansevoort family member, &, prior to managing the property, as I have been told, never had any experience running a hotel/condo - they were n the paper product business) is charging the property a million dollars, per year, to manage the property. Prior to the Gansevoort purchase, we were paying less than 1/10th of that. I am an apt. owner on the "poor side" of the property - The Roney Palace. The U-shaped property consists of the older condos (Roney) on one side, & the Gansevoort hotel & Paradiso condos on the other. We pay 47% of the total fees for the entire property. Since the Gansevoort took ownership our maintenance fees have dramatically increased. We have been paying (aka - being ripped off) to cover the hotel's, & the unsold Paradiso condos (the Gansevoort's condo element) through the nose, for their management fees, towel service, utilities, employee lunches!, etc, etc, & receiving sub-standard service (inferior maintenance, poor security, few improvements) on our side of the property. Yes, the Gansevoort did do a very cool & hip gut renovation.... it is tres au courant! The hotel rooms are huge, comfortable & slick. The roof "Plunge" pool is chic. The center & south pools are in need of some TLC (of course, the Roney owners use these)
It is unfortunate that the timing of their opening coincided with the economy, & condo sales, severely tanking. But, while the Roney owners are being milked to financially support the property, we are the forgotten ones when it comes to investing dollars on our side. We are being force to pay fees that should equate with a luxury property & getting little in return..... the Roney looks sad & worn.
Does the "Gansevoort" name have hip appeal? yes it does. But, "a rose by any other name smells as sweet".... the property is a wonderful building on a fabulous piece of the beach. I could care less if they call it the Memory Motel, as long as we get what we are paying for & the ENTIRE property is maintained properly. The Gansevoort owners have chosen hip over class. Class lasts..... hip blows out like the wind - the bank is flushing the toilet & swoosh - they are circling!

http://www.miamiherald.com/news/miami-dade/story/1488406.html

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