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New owner takes control of troubled Banyan Cay project in Florida

New owner takes control of troubled Banyan Cay project in Florida

Calmwater Capital, the lender to the troubled Banyan Cay Resort & Club, took control of the West Palm Beach project late last month. The move followed a failed bid to sell the property to an outside buyer in Banyan Cay’s Chapter 11 bankruptcy reorganization.

In a brief statement issued Wednesday, Calmwater Capital pledged to complete the unfinished hotel.

The Los Angeles-based lender said it has hired crews to complete the 150-room hotel and resort, which will feature three restaurants, a spa and fitness complex, wedding venue, meeting space and banquet facilities for up to 200 people. Calmwater said the resort also will include a resort-style pool and pickleball courts.

In addition to finishing the hotel, Calmwater Capital said the 18-hole, 130-acre Jack Nicklaus Signature golf course will reopen Sept. 30. The course closed in August after a would-be suitor, Westside Capital of Denver, failed to follow through on a $102.1 million purchase of the hotel and golf course.

The Jack Nicklaus-designed Banyan Cay Golf Club, part of a larger development in West Palm Beach, Fla. (Courtesy of Banyan Cay Resort & Club)

Westside’s decision not to close on the purchase left Banyan Cay with no choice but to let the lender’s $96.5 million credit bid stand. The amount reflects the debt extended to the hotel and golf club.

On Aug. 31, U.S. Banktrupcty Court Judge Erik Kimball approved the property’s transfer to a Calmwater Capital affiliate, U.S. Real Estate Holdings III.

The hotel was supposed to open as a Destination by Hyatt property, the company’s only Destination brand in Florida. Now it’s not certain the Hyatt brand will remain. In its statement, Calmwater said the brand and timeline for completion will be announced at a later date.

The ownership change marks the latest twist for the troubled resort and golf club, which is located just east of Interstate 95 off Congress Avenue and north of Palm Beach Lakes Boulevard.

The property previously was the site of the President Country Club, but the club fell into financial trouble and was sold to an investor group for $11 million in 2011. That investor group then flipped the property to Banyan Cay Dev LLC, led by Domenic Gatto Jr., for $26 million in 2015.

Construction of a resort hotel was beset by delays, to the dismay of The Lands of the President community, which overlooks Banyan Cay. In addition, residents in an adjacent new single-family community, the Residences at Banyan Cay by SobelCo, were…


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