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Closing in on Colony vote

STEVE REID
Editor & Publisher
sreid@lbknews.com

The literal view most Longboat Key residents have of the Colony Beach and Tennis Resort is that nothing is happening at all. The buildings appear frozen in time and dormant, the gate remains locked and the only movement is the passage afforded to the town to allow sand trucks to access the beach that once sported thousands of guests year after year for more than four decades.

This apparently slow movement on the ground has a counterpoint as attorneys have spent the last two months slowly reviewing the details of Unicorp’s redevelopment proposal which unit owners will vote on within the next month and could decide the fate and future of the 17.3 acre property and the right to develop the 237 units.

Unicorp President Chuck Whittall told Longboat Key News that the attorneys are close to agreement on the final wording of the proposal and he expects the plan to go for a vote in as soon as two to three weeks.

Whittall said that it has mainly been “legal-eze” that has been worked on, but the essential components of the plan have not changed since last March when the Colony Board of Directors voted 9-0 in favor of the proposal which calls for 180 hotel rooms and 180 condominium units with shared amenities.

 

Details of proposal

The proposal made by Unicorp is to pay $130,800 for each unit with an additional $100,000 paid to the owners of the 15 mid-rise units which command waterfront views. The owners of the existing 13 beach-front units as well as the Presidential and Vice Presidential units will be offered a $200,000 premium above the $130,800.

Unicorp will pay other costs including taxes, insurance, as well as two loans that are attached to the property and association. Unicorp has stated the value of the offer at $46,222,000.

 

Andy Adams factor…

While the offer is attractive enough for the Board of Directors to move forward with, what remains an unknown is whether Andy Adams, who owns 30% of the units at The Colony, will vote in favor of the proposal. It will take 75% of the Unit Owner’s approval for the plan to move forward, and Adams could present a deal breaker even if every other unit owner votes in affirmation.

Adams has remained true to the cliché of playing his cards close to the vest and had previously made a redevelopment proposal, which the board did not embrace.

Adams has spent roughly $4 million to $5 million to acquire his 70-plus units and if he stands to be paid an estimated $11 million for his assets under the proposal.

Unicorp’s President Chuck Whittall said that he has not heard from Adams and that he has been working directly with the Association and its Redevelopment Committee. Whittall did say that in his mind the redevelopment proposal is far superior to what is a possible outcome if Adams votes against the proposal.

Whittall says that if no plan is approved and the Association cannot redevelop, the property could eventually be auctioned. Whittall says that the encumbrance of the recreational lease claim as well as the fact that Unicorp controls the commercial units, meaning the spa, restaurant and other amenities, would diminish the value at auction. That brings up the issue that if a state court finds that the property cannot be rehabilitated, and is demolished, it would go to auction and every owner would be paid a pro-rata share.

 

Whittal to buy Colony Lender assets

Whittall said that Unicorp controls the recreational amenities and 2.3 acres of the site through its contract with Colony Lender, which bought the assets at a discount from a bankrupt estate that Bank of America sold as collateral. Whittal says Unicorp will execute its contract with Colony Lender within the next five weeks, through a 1031 exchange following the sale of a large portfolio of property.

If Whittall’s proposal is approved by the Colony Unit Owners, a voter referendum would have to be held to allow the residential density on the site as dictated by the Town Charter. There would also have to be significant changes to the town land development codes, since the town does not have a process in place to consider a mixed use proposal on the site.

The town has told Longboat Key News that it is working on developing a Planned Unit Development Procedures that will apply to The Colony and similar properties on Longboat Key and expects to have that process in place before there was any chance of a redevelopment plan being submitted to the town.

 

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