Buyers Welcome for Bankrupt Palm Beach Property
The bidding is expected to be brisk for a high-profile Palm Beach condo-hotel being sold next month at auction.
WEST PALM BEACH–Courtroom B of the U.S. Bankruptcy Court at 1515 North Flagler Drive here should be packed on Nov. 16 at 10 a.m. when a high profile Palm Beach condo-hotel located less than a block from the Atlantic Ocean will be sold at auction.
“The opportunity to own and operate a condo-hotel or hotel in one of the wealthiest and most-desirable submarkets in the nation has attracted major institutional and private client interest alike. We anticipate many more of these high-profile groups to be present at the courthouse for the official auction as well,” says Robert Given of Cushman & Wakefield.
“The Palm House Hotel represents a truly rare opportunity for investors and developers to obtain and put their stamp on a trophy asset in one of the world’s most recognizable and desirable locations,” adds Cushman’s Errol Blumer.
Cushman & Wakefield has been named exclusive marketing advisor in the disposition of The Palm House Hotel via a Section 363 bankruptcy sale.
The Cushman & Wakefield South Florida Multifamily Team of Given, Blumer, Michael Mulkern and Robert Kaplan was selected to market the property on behalf to 160 Royal Palm, LLC, through its court-appointed manager, former Delray Beach Mayor Cary Glickstein.
Location One of the Most Prestigious Zips in US
The Palm House Hotel is a 79-unit hotel-condominium located on a 1.38-acre site at 160 Royal Palm Way on Palm Beach Island. The property near the Atlantic Ocean is in one of South Florida’s most prestigious zip codes. The 33480 has residential sales in the immediate vicinity regularly exceeding $1,000 per square foot.
The 82,648-square-foot project was initially developed in 1961 and expanded in 1981. In 2006, significant renovations were started at the property, but were halted in 2014 due to litigation among various parties. The property is currently vacant.
Pursuant to court-approved bid procedures, opening bids for the auction sale will start at $32.5 million and increase in $50,000 increments, or as otherwise determined by the debtor prior to or during the auction process. To be a qualified bidder for the auction sale, potential bidders must submit a 10% escrow deposit, along with the completed Asset Purchase Agreement and summary of financial capabilities, no later than 5 p.m. on November 9, 2018.
Section 363 Rules Offer Building Free From Liens
As a Section 363 bankruptcy sale, the Palm House Hotel is offered free and clear from any liens through a bidding and auction process approved by the bankruptcy court. The process began recently with the selection and approval of a stalking horse bidder — a qualified bidder who establishes a floor purchase price in the auction. The stalking horse asset purchase agreement was executed with a purchase price of $32 million.
Following the auction sale, the transaction documents will be submitted to the bankruptcy court for approval. Once a court order approving the sale is entered by the court, there is a 14-day objection period whereby interested parties may appeal the court order approving the sale. After the objection period has expired, the sale is final. The Cushman & Wakefield team anticipates closing in late November or early December.