MIAMI, Feb. 10, 2011 /PRNewswire/ -- The owner of a new $40 million luxury condominium hotel in Playa Blanca, Panama has taken over management of the resort following the withdrawal of the operator, the Miami-based Nikki Beach group.
The five-star property, which features 240 condo hotel units (80% sold), was built and is operated by RG Hotels Group and its subsidiaries, owned by the Galvez family of Panama. Under a contract signed in December 2006, the local partners were granted the full exclusive right to use the "Nikki Beach" brand name in Panama for a term of five years. Later on, in May 2007, the parties entered into an operating agreement for Nikki Beach Hotels to take over management of the property.
"Despite the problems experienced with Nikki Beach as operator, we have upheld our commitments to condo owners, guests, and investors of the Nikki Beach Hotel and Resort Playa Blanca," said Maru Galvez of Santa Fe Holdings S.A. and RG Hotels Group. "We remain dedicated to the successful operation of this beautiful property, and are currently exploring other alternative brands under which we can operate this popular resort."
Nikki Beach has experienced other problems in its international expansion. In 2008, a Nikki Beach hotel in Turks and Caicos declared bankruptcy. Ten other Nikki Beach projects in the region, including a hotel in Roatan, failed to materialize.
Despite exclusive rights to the brand name until December 2011, Nikki Beach has published a notice on their website disregarding any affiliation with the Playa Blanca resort. In October 2010, when the hotel was 95% complete, Nikki Beach gave notice to suspend the operating agreement.
"We believe that Nikki Beach is walking away from its commitments at this project," said Juan J. Rodriguez, partner at Carey Rodriguez Greenberg & Paul LLP and counsel to the Galvez family group of companies. "Our client was promised top-level management staff, and Nikki Beach representatives were present on the ground to supervise the construction and interior design of the hotel up until the last minute. It has been a disappointing experience to work with a company that holds itself out as a luxury hotel operator."
Santa Fe Holdings S.A., headquartered in Panama City, Panama, is the sole owner of subsidiaries RG Hotels and Casa Campo Farallon, and has more than 12 years experience in the hospitality industry, operating dozens of successful luxury real estate developments across the country. Law firm Carey Rodriguez Greenberg & Paul LLP is based in Miami with offices in Boca Raton and Washington DC.
SOURCE Carey Rodriguez Greenberg & Paul LLP