Naples Bay Resort doing good business, but still in danger of going under
By Pankaj Ladhar of Manos • Alwine P.L.
A commercial dispute related to loan made to develop the Naples Bay Resort is making it difficult for the resort to secure outside financing despite their contention that they are doing brisk business. So far the developer has been able to cover any cash shortfalls to keep the business operating, but he says that he is unwilling to do so for much longer.
The ongoing litigation which seems to have placed a cloud over the project is centered on purported claims made by the developer while securing financing from Fifth Third Bank. The bank says that the developer falsely represented the collateral that he had posted for the loan. The developer disputes these claims.
The property is facing foreclosure and has been put under the oversight of a court-appointed receiver. The receiver says that the resort is having a good year. He explained that occupancy rates are up significantly and that their daily rates are up as well. The developer says that business is up 40 percent from last year and that they are on the verge of breaking even.
Despite the growth in the resort’s business, the receiver says that it will need more than $3million in the next year to keep operating. The receiver is working to secure this financing but agrees that the ongoing litigation makes it difficult.
Sometimes, even despite being able to get a business off the ground in a tough economy, unanticipated litigation can present an obstacle going forward. When facing this type of litigation it is important to work with someone who understands not only your goals in the litigation but also your larger business goals and helps develop a strategy that can achieve them both.
Source: NaplesNews.com “Business is up at Naples Bay Resort, but new financing is needed to keep it going,” Laure Layden, Oct. 18, 2011