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Article Courtesy of The Palm Beach Daily News
By Darrell Hofheinz
Published August 8, 2018
A court-appointed receiver has ushered the beleaguered Palm House
condominium-hotel project into bankruptcy court — and its ownership company
owes nearly $115 million to creditors, the court filing shows.
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Thursday’s voluntary Chapter 11 corporate bankruptcy
petition for 160 Royal Palm LLC comes more than three years after
renovations abruptly halted at the property in the ocean block of Palm
Beach’s Royal Palm Way.
Former Delray Beach Mayor Cary Glickstein is the court-appointed receiver
for the beleaguered Palm House property in Palm Beach. A circuit-court ...
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The filing paves the way for a bankruptcy judge to authorize the sale of the
Palm House building with a title free of liens or other legal encumbrances,
according to bankruptcy attorney Philip J. Landau. Landau signed the
bankruptcy filing along with receiver Cary Glickstein, a former Delray Beach
mayor, who is serving as the authorized representative of the debtor, court
documents show.
Proceeds from the sale of the property would be used toward repaying
creditors, Landau said.
On July 10, Glickstein outlined the bankruptcy plan to the Town Council,
which then agreed to once again suspend mounting code fines at the property
at 160 Royal Palm Way.
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The company that owns the Palm House
hotel-condominium at 160 Royal Palm Way has filed for Chapter 11
bankruptcy. That move may help facilitate a sale of the property,
according to its court-appointed receiver.
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The bankruptcy filing also followed a July 3 decision by
a Palm Beach County judge to significantly expand Glickstein’s legal powers
to act as sole manager of the Palm House’s ownership entity, a limited
liability company.
The document lists the address of the debtor’s “principal place of business”
as the Palm Beach oceanfront mansion of developer Robert “Bob” V. Matthews,
who is facing federal felony fraud charges related to alleged financial
improprieties at the Palm House. The company’s mailing address is listed as
Glickstein’s house in Delray Beach.
Matthews’ Palm Beach attorney, Leslie R. Evans, also is facing felony fraud
charges. Evans and Matthews have pleaded not guilty to all charges and await
trial in a U.S. district court in Connecticut.
Two other men have entered plea agreements in the case. Boynton Beach
contracting executive Nicholas Laudano has pleaded guilty to two felony
fraud counts. Real estate broker Gerry Matthews, who is one of Bob Matthews’
brothers, has pleaded guilty to one felony charge. Both are scheduled to be
sentenced next year.
In a July 9 court filing, Glickstein wrote that 160 Royal Palm LLC was
“controlled nominally by Gerry Matthews and effectively by Bob Matthews.”
But his expanded role gave Glickstein control as the company’s manager.
The bankruptcy action came with the blessing of Palm Beach County Circuit
Judge Donald W. Hafele, who has been overseeing a series of complex civil
lawsuits churning around the renovation project.
“I’m trying as best as I can to protect as many interests as I can,” Hafele
said at a hearing July 26.
Landau, of Shraiberg, Landau & Page in Boca Raton, said his employment must
be approved by bankruptcy Judge Erik P. Kimball, who is handling the case.
Kimball also will be asked to authorize hiring a real estate brokerage to
market the Palm House property for sale, Landau said.
If all goes according to plan, a sale could be completed by the end of
December or early next year, said attorney Gregg H. Glickstein, who has been
representing his brother Cary in Palm House legal proceedings. |
