Representatives of the owners, Lehman Brothers Holdings, stormed the hotel at 2.30am and informed the managers, Singapore based General Hotel Management (GHM) that their services were no longer required. Hans Jenni, the GHM President said: “Representatives from Lehman Brothers arrived at the hotel with armed guards and off duty sheriff officers in uniform in the early morning hours on March 31st. They informed us they were taking over the property and that GHM was no longer welcome on the property.”
The new management installed at the luxury hotel complex by Setai Owners LLC, a company associated with Lehman Brothers Holdings Inc, is the Trevi Luxury Hospitality Group from Dallas and the company plans to ensure that all existing workers at the resort will retain their jobs.
The main debate centres on the profitability of the Setai South Beach Resort and speaking about the change of management, Anthony Barsanti from Lehman Brothers Holdings Inc, said: “Our goal is to improve profitability, management and overall Seti experience for hotel guests and condominium owners, we believe that under the right management this property has limitless potential.”
GHM disagree and believes that the profits from the Setai South Beach were strong. Non Executive Chair and Director of GHM, Adrian Zecha added: “Under GHM management, The Setai South Beach has provided a strong resident experience that has been key to maintaining and increasing the value of the individual properties, creating record breaking prices for the property sales.”
Setai Owners LLC is to start legal action against GHM on the grounds that the company has violated terms of a contract written on March 20, 2000. Lawyers for Setai Owners LLC, Bickel and Brewer, based in both Dallas and New York announced: “The owner believes that it was in the best interest of the project to exercise its rights, install new management at the resort and initiate the arbitration,” said William A Brewer III. The arbitration suit concerns many millions of dollars in compensation.
Setai Owners LLC clams that the hotel hasn’t achieved maximum occupancy and compares poorly to other properties in Miami-Dade County. GHM disagrees and President Jenni has recently been quoted as saying: “At this time we are not in a position to comment on the specifics of their allegations. We are in conversation with our lawyers and will take the necessary steps to ensure that Lehman Brothers complies with the requirements of the management contract in place.”
The Setai South Beach is a luxury hotel and resort made up of beautifully appointed suites. The hotel comprises two buildings overlooking the ocean and promises an upmarket experience for its guests. In December 2011 a penthouse suite at Setai South Beach sold for a staggering $ 21.5m.
