Drew Wilson
A Miami Beach condominium owners’ association filed a lawsuit Thursday against the hedge fund that bought the Carillon Miami Beach, formerly Canyon Ranch, out of bankruptcy.
In the brief, the North Carillon Beach Condominium Association accuses Z Capital Partners of “multiple forms of predatory deceit and exploitation” and said the group bought the property “without any relevant development or operating expertise in top-end hospitality and wellness.”
Z Capital bought the property for $21.6 million over the course of 2015 and now faces lawsuits from the owners’ associations for each of the former hotel’s three towers.
North tower owners say Z Capital has driven down property values and slashed staffing while simultaneously imposing exorbitant maintenance and capital assessments that place the financial burden of operating and renovating the property on the owners.
In the south tower lawsuit, filed earlier this year, owners say they were assessed more than $17 million in fees last year by Z Capital — nearly $30,000 for each of the tower’s 580 units — while being locked out of inspecting Z Capital’s financials to determine whether the assessments were fair.
The suit also slams Z Capital for downgrading the resort’s amenities and failing to nail down a deal for Adrian Zecha, founder of Amanresorts, and Jonathan Breene, founder of Setai Group, to run the property.
“The contract promised ‘a level of service equivalent or comparable to the Aqualina in Sunny Isles Beach, St. Regis in Bal Harbour and the Ritz-Carlton in Ft. Lauderdale,’” the group said in the lawsuit. “But today, instead of being run under the ‘premier, luxury flag’ led by Breene and Zecha — and indeed instead of even being run by the original operator, Canyon Ranch — the facilities at the Carillon are being operated by Z Capital itself.”
