Bankruptcy Judge Approves $41.5 Million Sale Of Former Versace Mansion
Yes/Bankruptcy and Resl and comml RE/Org-Company/Ind-RE
A bankruptcy judge in Miami on Wednesday green-lighted the $41.5 million purchase of the former Versace mansion by the family behind Jordache Enterprises Inc. and partners.
U.S. Bankruptcy Judge Laurel M. Isicoff approved the purchase by VM South Beach LLC, a partnership of the New York-based Nakash and Gindi families. VM South Beach emerged from Tuesday's bankruptcy auction as the winning bidder.
The Nakash family owns Jordache and several Miami Beach hotels, including the Hotel Victor adjacent to the ornate mansion.
VM South Beach was the lead creditor in the Chapter 11 case of mansion owner Casa Casuarina LLC, which is backed by telecommunications entrepreneur Peter Loftin. VM agreed to serve to start bidding at $25 million and had the ability to make a credit bid of more than $34 million.
Attorneys for VM and Casa Casuarina told Isicoff that the sale price would be more than enough to repay all creditors in the bankruptcy case. The transaction must close in the next 20 days.
Isicoff also approved a settlement between Casa Casuarina and the trustee for Ponzi schemer Scott Rothstein's failed law firm Rothstein Rosenfeldt Adler. Under the settlement, the RRA trustee is to receive about $690,000 from the auction proceeds. The original claim was for $4.92 million.
VM South Beach plans to convert the landmark mansion at 1116 Ocean Drive into the Versace Hotel and combine the building with its hotel next door. The Italian fashion designer's family will be asked for permission to use the name of the mansion's most famous resident. The company does not plan to make any structural changes to the landmark.
Miami-based Greenberg Traurig shareholder Ralph Bekkevold represented the Nakash and Gindi families in the auction and VM's December 2011 purchase of the debt secured by the mansion.
"We are absolutely thrilled to have been able to see this deal to completion in such a short timeline considering all the challenges and obstacles we had to overcome," Bekkevold said in a statement. "The garden variety foreclosure of a house in Miami-Dade County takes two to three years, and we did this highly complex deal in just one year and nine months."
Celebrity developer Donald Trump ended up in second place in bidding for the 19,000-square-foot, 10-bedroom estate featuring a 24-karat gold-bedecked swimming pool. South Beach Ventures LLC, a Trump company, offered a backup bid of $41 million in case VM's offer fell through.