SINGAPORE-based General Hotel Management (GHM) was forced out of the Setai South Beach in Miami when representatives of the owning company stormed the hotel at 2.30am last Saturday, complete with armed guards and off-duty sheriff officers in uniform, and informed GHM it was no longer welcome on the property.
Guests of the luxurious property woke up on Sunday, April 1, to a hotel managed by US-based Trevi Luxury Hospitality Group, which the owning company, Setai Owners LLC, a unit of Lehman Brothers, installed following the overnight takeover. It was not an April Fools’ joke.
Hans Jenni, president of GHM, responding via email to TTG Asia e-Daily’s request for comment, described the takeover as “simply shocking”, and posed serious questions whether management agreements today were of any value.
“These actions took us by surprise, as we had no prior indication they were intending to do this, nor were we under the impression that they were unhappy with our performance. We had just achieved the second best financial performance year since the inception of the hotel, not an easy accomplishment in the current economic environment.”
A report in USA Today quoted lawyer William Brewer III, a partner at Bickel & Brewer and counsel for the owner, as saying the owner claimed the hotel should be more profitable.
In contrast, a similar takeover last year on behalf of the owners of Marriott’s former Edition Waikiki – also orchestrated by Brewer – was over the hotel’s financial losses.
Jenni said: “At this time we are not in a position to comment on the specifics of their allegations. We are in conversations with our lawyers and will take the necessary steps to ensure that Lehman Brothers complies with the requirements of the management contract in place.”
“The allegations shared by Lehman Brothers’ council are defamatory, damaging and without basis. Lehman Brothers have ignored a valid contract, stormed the hotel and have taken the law into their own hands.”
“Their lawless behavior is sending the message that no contract is enforceable.”
Adrian Zecha, founder of Amanresorts and non-executive chairman and director of GHM, said: “It was GHM that created the Setai concept and experience, leading the hotel to achieve numerous industry recognitions.”
“Under GHM management, The Setai South Beach has provided a strong resident experience that has been key to maintaining and increasing the value of the individual properties, creating record breaking prices for the property sales,” he added.
