The Prince Of South Beach - Page 5 of 6 - Black Enterprise

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Black Enterprise Magazine January-March 2019 Issue

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to woo the commissioners to vote in his favor and emerged as the winning bidder in June 1996. Though he was elated at the time, his joy would be short-lived. Then-Mayor Seymour Gelber, who had voted against the Peebles deal, assigned Arthur Courshon, a bank president, retired lawyer, and staunch opponent of Peebles, to negotiate the final contract for the project. Earlier in the voting process, Courshon had strongly recommended one of Peebles’ competitor’s bids. Talks between Peebles and his nemesis, Courshon, dragged on for months — Peebles says deliberately — while investors became impatient with the delays and mounting expenses. Peebles had hoped to complete the project by year-end 1998 — a hope that would quickly fade.

“When I get possession of the property, we find contaminated soil — when the city had given us an environmental report saying the site was clean,” Peebles says, adding that he also received a structural report from the city’s building department saying it was structurally sound. “So we were tearing down all the walls getting down to the concrete, and what happened is when the buildings were built, they used beach sand to make the concrete. So you had all the high sodium content of the concrete corroding the steel.” When the steel support structures were inspected, they were all corroded, and Peebles asserts that the same building department that certified the building as structurally sound came in and condemned the property.

In order to develop the property, Peebles had to tear down Royal Palm, but since it was a historic property, built in 1939, there was a requirement that the developers preserve it. He had to get special permission from the city’s historic preservation program to tear it down — halting all development on the project. “Finally, the city allowed me to tear it down but required me to build an exact replica of the original,” says Peebles.

When all was said and done, the project came in nearly two years late and costs totaled $82 million — more than $20 million over budget. The property celebrated its grand opening in May 2002 and currently has a year-round occupancy rate of approximately 70%. Though he was beset with political and financial pressures, Peebles remained committed through it all. “The key was the building needed to be finished. I think any qualified African American developer would have done the same thing,” he asserts. “I was not going to allow my company or myself to be known as the person or company that got the opportunity to build an African American-owned hotel in South Beach and couldn’t get it done even though the city gave us $10 million.”

The completion of the deal was heralded throughout the African American business community. “It was huge because it was the first time in the history of this area where you had a substantial development owned by an African American going up on the beach,” says Andy Ingraham, president of the National Association of Black Hotel Owners, Operators & Developers Inc. “Let’s

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