to have a material effect on net hotel revenues, but does project the sale to raise $120 million that can be used for future acquisitions.
Such shrewd, audacious moves spurred the company to a phenomenal 141% revenue growth last year and made its dynamic founder a significant force on the red-hot South Florida luxury real estate scene. For this, BLACK ENTERPRISE has named Peebles Atlantic Development Corp. its 2004 Company of the Year.
A SIMPLE BUT LUCRATIVE STRATEGY
Peebles’ strategy is simple. He targets a market segment where people are more product-oriented than price-oriented — folks who if they like what they see, they buy it. It’s a niche market Peebles feels has tremendous growth opportunity. And he’s probably right. According to the Travel Industry Association of America, domestic leisure travel has slowly but steadily increased over the years, despite the aftermath of Sept. 11, the lagging economy, and the war in Iraq. The association, a Washington, D.C.-based nonprofit that represents the interests and concerns of the U.S. travel industry, is forecasting leisure travel volume to grow 3.2% in 2004, up from a predicted 2.8% annual increase last year.
The irony is that Peebles’ entry into the South Florida real estate market was somewhat coincidental. While on vacation in Miami Beach with his wife, Katrina, and their then-infant son for the 1995 New Year’s holiday, Peebles came across an article that would reshape his business. “I was reading the paper, and there was a story in The Miami Herald about how South Beach had grown and the real estate market is on fire, and they gave an example of the Shorecrest Motel that was owned by an investor who paid $900,000 two or three years ago and was now selling it for $5 million,” says Peebles. “And they said it was next door to the Royal Palm Hotel that was owned by the city, which was looking for an African American developer.”
It was the first time Peebles had heard of a project that was reserved for a specific race. “So I said to myself, ‘How many African American developers are in this county? Not many. How many have the capacity to do a project of this size? Even fewer. And how many are reading The Miami Herald right now? Probably not many.’”
There was a reason for the set-aside. Several years earlier, prominent local attorneys H.T. Smith and Marilyn Holifield led a tourism boycott by African Americans, claiming city officials had snubbed South African leader Nelson Mandela when he visited because the former political prisoner made positive remarks about Cuban President Fidel Castro. Miami is home to the largest Cuban population in the U.S. This made the city, which was segregated until the mid-60s, a hotbed for political and social unrest.
As part of the 1993 settlement to end the boycott, which gained national attention when the NAACP got involved, Miami Beach agreed to underwrite the development of a black-owned luxury hotel by putting up a long-term $10 million loan to acquire the property. But the