Marriott International issued a statement Tuesday evening about its dispute with the owner of the Eden Roc Renaissance Hotel, located in Miami Beach, Florida.
The statement came after a New York judge issued a temporary restraining order against the hotel owner Eden Roc LLLP’s move to take over operations. Marriott International, Bethesda, Maryland, said that in the pre-dawn hours on Sunday, October 14, the Eden Roc LLLP attempted a surprise takeover of the hotel by force, in disregard of the law and its obligations under the hotel management agreement. The attempt ended when the Miami Beach police ordered the owner’s effort to cease.
“It’s inexplicable why ownership and its advisors would have engaged in this outrageous and reckless act that endangered our employees, the hotel and its economic prospects,” said Ed Ryan Marriott’s general counsel. “The attempted takeover failed. It is business as usual at the hotel, and our employees continue to welcome guests with the exceptional service they have come to expect at the hotel.”
In legal papers filed with the New York court, Marriott said that Eden Roc LLLP, a subsidiary of real estate development company Key International, Miami, had “knowingly, wrongfully, and materially breached a long-term management agreement with Marriott. Marriott will seek substantial damages from the hotel’s owner and its partners for their conduct in damaging the operation and reputation of the hotel and Marriott.”
The dispute has been going on for months. Eden Roc LLLP filed a lawsuit against Marriott International in April, seeking US$75 million in damages and accusing Marriott of mismanaging the hotel. After spending US$300 million on the property, Eden Roc LLLP alleged in its lawsuit that Marriott and its Renaissance Hotel flooded the hotel with discount bookings for years, generating a “mere fraction” of the US$30 million in profit projected for 2011 and the US$35 million forecast for 2012. Eden Roc bought the hotel for US$100 million from Blackacre Capital Group in 2005.
Marriott continues to operate the property.