Court sides with Capella in Cabo resort management dispute

Following a statement last week from owner Hoteles del Cabo that it terminated Capella Hotel Group from management of Capella Pedregal due to alleged improper financial reporting and diversion of revenues, Capella Hotel Group said a New York Supreme Court Judge has ordered that Capella Hotels and Resorts be reinstated as the management company of the Cabo San Lucas, Mexico, resort immediately. 

Capella also disputed various statements made by CarVal Investors, a co-owner of Capella Pedregal, including a claim Capella held donations raised to help the property’s staff affected by Hurricane Odile.

“We refute all their claims as inflammatory and intentionally misleading,” said Horst Schulze, chairman and CEO, Capella Hotel Group. “Immediately following the storm, an Employee Relief Fund was set up on In order to distribute these funds outside the U.S., the hotel was required to register with the Mexican government for that purpose, ensuring that the funds would not be distributed to a company or a single individual. That registration was finally received, and the funds were to be transferred [last] week. CarVal’s illegal takeover of Capella Pedregal has hindered the disbursement of these funds as originally intended.”

Hoteles del Cabo said last week it has instituted legal action to recover what it claims are the misappropriated funds and will pursue its remedies for other defaults under the management agreement.