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MIAMI BEACH, FL-Peebles Atlantic Development Corp. sold the Royal Palm Crowne Plaza Resort to Chicago-based Falor Cos. for $127.5 million, or $305,755 a key, which, according to published reports, sets a record for hotel acquisitions here. The 417-room resort includes the adjoining 161-suite Shorecrest property.

This is Falor’s sixth hotel acquisition in South Florida this year, and its fourth in South Beach. It is also the company’s largest hotel purchase to date, and Robert Falor, president and CEO, says in a statement, “we predict it to be one of our most profitable ventures.” Falor will invest $10 million in renovations and upgrades and plans a partial condominium-hotel conversion. Barron Channel, an in-house Peebles’ executive, negotiated for the owner, while Dianna Cheng was the exclusive broker for Falor.

“We have had great success in South Florida and plan to continue our growth here. It’s a place where everyone wants to live, at least part of the time, which keeps the condominium conversion trend going,” Falor says. His firm converted its three earlier South Beach acquisitions–the Tides, Breakwater and Edison hotels–to condo-hotels and reports that between 55% and 60% of the units in all three properties sold within 45 days of the closing.

While the Falor statement says it is negotiating to bring in a leading hotel operator, R. Donahue Peebles, president and CEO of the company that bears his name, says Falor anticipates bringing in Orlando-based Hard Rock Hotel to brand and operate Royal Palm and expects to sell Shorecrest as a condo-hotel.

Peebles acquired the properties in 1998 after winning an auction, launched by the Miami Beach City Commission, to provide $10 million toward the construction of an African-American-owned hotel. The impetus was the wish to end a boycott by African-Americans that resulted from a 1990 snubbing of Nelson Mandela for his expressed support of Fidel Castro.

Peebles invested $80 million in renovating the two structures, which are located at 1545 Collins Ave. on the North End of Ocean Drive in the South Beach Art Deco district. The resort, which has two pools, a fitness center and other upscale amenities, reopened in May 2002 to play host to such celebrities as Magic Johnson and Will Smith. In 2003, the NAACP cemented the end of the boycott by choosing Miami Beach for its national convention.

Meanwhile, Peebles says, “we’ve created an outstanding property and stabilized it. Now we have the opportunity to recover capital and create new opportunities for Miami Beach.”

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