Miami's Royal Palm sells for $127.5m.
Peebles' acquisition of the Royal Palm was a high-profile venture because its sale to an African American developer was a concession by Miami Beach to end a three-year tourism boycott. The boycott ensued after a 1990 visit by South African President Nelson Mandela, who was received coldly by some Miami officials for his support of Cuban leader Fidel Castro. Black developers were asked to bid on building an oceanfront hotel, which the city would underwrite with a $10 million loan. When financing fell through for the developer who initially won the bid, Peebles' investment group outbid two other firms.
Peebles had announced plans in 2004 to convert part of the Royal Palm into condominiums, which led to significant press coverage and subsequently a number of sale inquiries. Peebles says he turned away the offers until "somebody came to me and offered a very compelling number--$128 million--so we started negotiating a contract."
The Falor Co., a white-owned, Chicago-based hotel development company, reportedly intends to go forward with the condo conversion. Such a move requires city approval, in which case Peebles will pay back the $10 million he got from the city. The sale leaves Miami Beach without a major black-owned hotel property.
Andy Ingraham, president of the National Association of Black Hotel Owners and Developers, says Peebles' ability to sell a property for such a lucrative amount exemplifies the progress black developers have made in recent years and will provide a blueprint for others. Looking ahead, Peebles is working on a number of hotel projects in locations such as Southfield, Michigan; Las Vegas; and the Bay Area. He acknowledges that African American developers have made economic gains but continue to face institutional discrimination and limited access to capital. "The climate has improved, and I would hope that what my company has done at the Royal Palm ... and the other projects that we've done have helped create more opportunity for breaking that barrier."
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|Title Annotation:||National News|
|Date:||Feb 1, 2005|
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