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Plaza Resort & Spa in Daytona Beach. Life After Bankruptcy

Plaza Resort & Spa in Daytona Beach. Life After Bankruptcy

I recently received an e-mail from an owner of the unit in the Plaza Resort & Spa. No, I was not his agent when he bought the unit there abut two years ago. With the real estate market as it is, a terrific buy in 2005 turned into a heavy liability.

Gorgeous direct oceanfront studio. Maintenance fee since he purchased the unit more than doubled. With the price iin high $200s the mortgage payment plus Maintenance plus taxes are not covered by the rental income, and he needs to reach into his pocket to subsidize it.

And then the news, the Management company filed for Chapter 11. Sad story, but rather common lately. The rental check came, and it bounced back. He called and did ot get to anybody. Called the owners liaison, but did not speak to her. He even called the management, they transferred him to a phone, where he could not even leave a message.

He read my post Daytona Shoreline Hotel Tycoons File for Chapter 11 and sent me an e-mail asking whether I could give him any information.

He sold his home and lost money on the sale, moved out of Florida, struggles with this condo-hotel, which he is not even using any longer. View of the Ocean For him the checks not coming is not an option, he would not be able to pay that much money.

I promised I would go there and try to talk to someone, if I manage to get that someone. I came in the morning, it was quiet, the day was absolutely gorgeous. Ashley, the Owners Liaison, was at her desk. She is a nice looking young lady, we met before when I was representing buyers of units in the resort.

As I expected, Ashley told me that she did not have much to say, everything was the same way as before. The filing of bankruptcy did not change anything for the owners, according to the management. In this resort there were no changes, the same management company, no layoffs, nothing. Well, bounced checks were an unpleasant coincidence. Of course, it is a tell-tale sign of the times, but I do not have any reason not to believe Ashley.

The developer has so many properties, and a lot of them are either land, or empty hotels waiting for demolition, and Plaza Resort & Spa is their flagship property, and if any of their holdings are profitable, Plaza would be the first on that list.

So, dear owners. I was assured that you will be getting your money. If you still too deep in trouble, and need help, talk to us. We are not pushing, and we are knowledgeable.

Will filing for bankruptcy cause further decrease in prices in Plaza Resort & Spa?

Jon Zolsky, your Daytona Beach Connection
www.DaytonaCondoHotel.com

Posted by Jon Zolsky, your Daytona Beach, Florida connection on 09/30/2008 02:45 AM

Comments (2)

Plaza Resort in the Regional (Localism) Channel

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Originally posted at: Jon's Blog: Plaza Resort & Spa in Daytona Beach. Life After Bankruptcy

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2 Comments on Plaza Resort & Spa in Daytona Beach. Life After Bankruptcy

SEP

2008

I am the person that contacted Jon. First off, thanks Jon for going over there.

I read Jon’s article regarding the filing of Chapter 11 for Ocean Waters. I am the owner of a unit in the PR&S. I knew something was up when our rental income check for last month bounced. When I called them, they gave me some excuse about changing bank accounts.

Any case, it was absolutely impossible to get anyone to return my calls. I was trying to find out how the Chapter 11 affects owners. Most importantly, "do we still receive rental checks"? Of course NO ONE was answering their phone, returning my calls or returning e-mails. There is supposed to be an "Owner Relations" person at the PRS by the name of Ashley Brannan. Any attempts to contact her, or have her return my calls or e-mails, were futile. I even called the Ocean Waters management. There strategy was to say that they will transfer my call, then they simply transfer it to an extension that rings forever. When you call again, they see your number on caller ID, and them simply don't answer it.

We paid $264,000 for an ocean front unit on the 8th floor of the short building. We were not receiving enough money to pay both the mortgage and association fee (which has more than doubled in 2 years), so we had to sell our home, and pay off $80,000+ on the condo mortgage to try an bring down our payment. Boy, do I regret that, and regret not speaking to a financial adviser. We now owe $186,000 on the unit. If we do not receive a rental check, we will be forced to go into bankruptcy. I have perfect credit right now. We borrowed from family members to pay our condo mortgage/fees, to keep it that way (always paying them back).

We just moved to San Diego. I lost 80% of the cash equity of my home in Orlando. At least I got some money back. Enough to at least pay off my AMEX, which we had run up because we put groceries and other things on there so that we could free up cash to use for paying the condo mortgage.

Of course my main concern about this right now, is that my unit will somehow end up less in the rental rotation, because I have voiced myself. PR&S still own many units.As owners, we are not allowed to know how many days other units (most noticably those still owned by the PR&S) have rented out during the month. Remember, they keep 100% of that income, as apposed to "only" 55% of ours.

A foot note: Out of the blue today, I received a call today from Ashley Brannan. No apologies made. She simply wanted to get my new contact info, and said it was business as usual at the PR&S.

Deon,

I figured you cut and pasted it, and ended up pasting not into the HTML window, but instead into WYSIWYG window, and you could not then go in and edit. That's fine, this is simply to explain it to everyone else.

Again, they claim there is nothing to say, and the owner arenot going to be affected by the filing. Can't attest to that, I think a year ago they would have adamantly claim that such thing as bankruptcy can't happen to them.

Things are changing. I feel that there were many owners who bombarded them, and I hope there is no personal vengeance against you.

My experience with Ashley, who is Owner Relations Manager, so far was OK, at least she returned my calls every time and in timely manner. The fact that she called you today is pure coincidence as I did not give her your name.

I am not fond of the situatins when the developer has unsold inventory because of the perceived conflict between renting their own units first vs renting all units on rotation. Usually, rental management companies have a software program, which uses at least two parameters, like when the unit was rented the last, and for how long, so that theoretically this could be fair. I also know from the experience working in a big hotel, that there is practically impossible to run a separate system of assigning the units, however, the front desk operators can manually override the rotation system.

I am surprised that you do not have the answer to that, as I thought that in these 2-3 years this question was asked, and I thought that there was the answer.

Even though I am watching the condo-hotels, we are not the owners, and are not privy to the inside information. We also make a point of not attempting to collect it, so that we do not get in conflict with the management companies and the associations. We use the rule that we need to know or have information that any other diligent agent can obtain by inquiring. We usually know more as people often volunteer information, but we do not solicit it.

It is very unfortunate that your experience can't be called pleasant. I think it is in great part due to the fall of the market, and we can't blame Gillespie and Bray for that. I am sure that if the units kept appreciating and were now at $500K, you might have a different perspective.

I wish you the best in San Diego. Meanwhile, if you think that you need to do something with the unit, or can't keep subsidising it, let me know. You can call me on my mobile: 386-405-4408 or call lme in the office after 11 AM EST at 386-255-5355.

Thank you

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Jon Zolsky, your Daytona Beach, Florida connection

Daytona Beach, FL

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Jon Zolsky, Daytona Beach, FL. FunCoast Realty, 386-405-4408

Address: 313 S Atlantic Ave., Suite A, Daytona Beach, FL, 32118

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