Hotel Online 
News for the Hospitality Executive

Aspirations Have Fallen Hard at the The Royal Palm, Miami Beach -
 from Black-owned to BlackRock

By Fred Grimm, The Miami HeraldMcClatchy-Tribune Regional News

Apr. 15, 2008 - The Royal Palm opened in 2002 adorned with the lofty language of a great social experiment. Terms like black dreams, black pride, black hope, black determination echoed off the hotel's soaring Art Deco walls.

The sentiment was so persistent, so sincerely voiced, it was almost as if someone thought it might even be true.

The key phrase in 2002, the one that resonated across South Florida, was "black-owned." A black-owned Miami Beach convention hotel had been the jewel in the 1993 agreement that brought an end to a three-year black tourist boycott.


Last week, another term was associated with the ownership of the Royal Palm -- BlackRock Inc.

The New York investment firm went to court last week trying to wrest control of the struggling Miami Beach hotel. The lawsuit concerned a $25 million debt and a failed attempt to market the Royal Palm as a condo-hotel.

All that stuff about black enterprise? Long forgotten.

Back in 1990, one of those only-in-South Florida cultural collisions had roiled race relations. Nelson Mandela, on an official visit, had been snubbed by the local political leadership, bothered by the South African president's coziness with Fidel Castro.

Blacks wanted an apology. None came. The boycott was called, churning up lots of unkind national media attention. Black conventions canceled. Damage to the local tourist industry was estimated at $20 million before a settlement was reached three years later.

The key to the deal: The city of Miami Beach would subsidize a black-owned convention hotel. The city would loan the project $10 million in return for a promise of minority ownership and strict minority hiring levels. At least 25 percent of the hotel management had to be minority -- minority meaning blacks, long shut out of the tourist economy.

Nationally syndicated radio host Tony Brown said the Miami Beach deal "would become what Montgomery, Ala., became when Rosa Parks started the civil rights movement."


But black developer R. Donohue Peebles was not Rosa Parks. Miami Beach was not Montgomery. By 2004, the Royal Palm was not even a black-owned hotel.

Peebles flipped the property. Sold 87.5 percent to a couple of white guys who figured they could make a killing converting the 417-room Royal Palm into a condo hotel. Those hard-fought agreements to insure minority ownership? The requirement to insure minorities in the hotel management? All that went away when the dealmakers paid off the $10 million loan from the city.

The Royal Palm, for all its financial troubles, still looked sparkling Monday with its grand juts and curves and giant portholes and two swimming pools at the foot of the dunes with so many happily oiled tourists on lounge chairs.

But nothing about the place memorized its idealistic origins. I only saw a couple of black employees -- a desk clerk and a maid. Only two black hotel patrons were poolside. I saw none passing through the lobby.

Apparently, the only real accomplishment of the three-year boycott was to make a rich black developer richer still. Peebles has claimed he cleared about $65 million when he sold the great black hope on Miami Beach.

Now some judge in New York must sort out just who owns the debt-plagued Royal Palm. BlackRock, unless it can collect its $25 million note, wants to take control of the hotel.

Aspirations have fallen hard at the Royal Palm: from black-owned to BlackRock.


To see more of The Miami Herald or to subscribe to the newspaper, go to

Copyright (c) 2008, The Miami Herald

Distributed by McClatchy-Tribune Information Services. For reprints, email, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA. NYSE:BLK,

To search Hotel Online data base of News and Trends Go to Hotel.OnlineSearch
Home | Welcome| Hospitality News | Classifieds| One-on-One |
Viewpoint Forum | Industry Resources | Press Releases
Please contact Hotel.Onlinewith your comments and suggestions.