At an oceanfront Hilton-branded condo hotel in Fort Lauderdale Beach, developers Joseph Cabanas and Jose Luis Zapata are allegedly blocking a group of investors from renting and selling their units, according to court documents and interviews with some of the owners.
It’s a nasty fight that’s ignited a series of lawsuits over the last two years against Q Club Hotel, an entity managed by Cabanas that owns the hotel component at the Q Club Resort and Residences at 505 North Fort Lauderdale Beach Boulevard. The hotel portion of the 25-story high-rise is known as the Hilton Fort Lauderdale Beach Resort.
Although he is not listed on Q Club Hotel’s corporate records, Zapata developed the 350-unit building in 2007, and his development entity designated Cabanas as the hotel component’s owner representative, according to court records. The units are a mix of studios, hotel suites, and one-, two- and three–bedroom condos.
“It has been a nightmare,” said Barbara Cortopassi, who owns a Q Club unit on the 16th floor. “I have been unable to rent my suite since they kicked me [out of the hotel program.] People are paying out-of-pocket while generating no income.”
The unit owners and the complaints, including a February lawsuit filed in Broward County Circuit Court by the condo-hotel’s condominium association, allege Q Club Hotel is violating the building’s condominium declaration and rules and regulations. They claim it is part of an ongoing campaign to punish investors who don’t use the hotel management system to handle bookings and hotel guest services.
Cabanas, who heads Doral-based Cabanas Group, and Zapata, lead director of Fort Lauderdale-based Orchestra Hotels, did not respond to requests for comment. Lawrence Litow, the attorney for Q Club Hotel, also did not respond to phone messages and an email requesting comment.
Cabanas and Zapata also partnered to develop the Conrad Fort Lauderdale Beach, a financially troubled condo-hotel project completed in 2017 that was late and over budget. In December 2016, Zapata sold his 51 percent interest in the Conrad to Canada-based Heafey Group and the Pegula family, owners of the NFL’s Buffalo Bills. Two years later, the Heafey-Pegula partnership and the Cabanas entity that owns a 49 percent stake in the Conrad, sued each other in Miami-Dade Circuit Court over management of the condo-hotel and alleged breaches of contract. Both sides reached a mediated private settlement in 2020, records show.
At the Q Club property, Cabanas is manager of the hotel component, according to recent letters he sent Cortopassi and other unit owners. He notified them that they are in violation of Q Club Hotel’s rules and regulations governing who is authorized to enter their condos and the type of locks they can install on their unit doors.
In December, Cortopassi and four other owners hired Port City Company, an Aventura-based brokerage led by managing partner Michael Webster to market and rent their units for hotel stays. Port City is also marketing some units for sale.
“My group got involved because these private owners haven’t been able to rent their units since they were kicked out of the hotel program,” Webster said. “We took over management of about 10 units. However, because [Q Club Hotel] still controls the front desk, if we don’t get their permission in advance and don’t have a security escort, we don’t have access to the units.”
Over the last nine months, Q Club Hotel and Hilton employees have taken extreme measures to stop him and his team from entering his clients’ units for showings and regular cleanings and maintenance, Webster said. That has included threatening them with trespassing, even though he has a power of attorney from his clients. Last week, the front desk blocked him from using the elevators, he added.
According to the condo association’s February lawsuit, Cabanas and Zapata controlled the board of directors from the project’s completion in 2007 until 2020. During that time the board adopted condo rules and regulations that gave the hotel unit entity unilateral control over individual unit owners’ ability to rent their part-time residences on a short-term basis, the lawsuit states.
In January, even though individual unit owners had since taken over the board, Q Club Hotel adopted and is attempting to enforce new “unreasonable and unequal regulations” on unit owners who are not in the hotel management program, the lawsuit states. The condo association also alleges Q Club is in violation of the building’s condominium declaration.
For instance, Q Club Hotel now requires the unit owners that are not in the hotel program to submit names of potential guests and tenants 15 days in advance of their stay for approval by the hotel operator. Anyone staying in their units cannot bypass the front desk, and owners must be present at the time of check-in in order for their guests and tenants to gain access to the residences, the Q Club Hotel’s rules and regulations document states. Q Club Hotel also bans non-hotel program owners from hiring their own housekeepers to clean their units.
Recently, Q Club Hotel passed a new rule prohibiting non-hotel program owners from renting their units for a period of less than 60 days.
In a counterclaim to the condo association’s lawsuit, Q Club Hotel claims that the condo declaration “clearly and unambiguously” grants the hotel component owner the authority to implement regulations for hotel bookings, front desk check-ins and hotel guest services. Q Club also asserts that its rules are “reasonable and necessary to ensure safe and orderly operation of [the condo-hotel],” as well as to avoid any confusion that individual units are associated with the Hilton hotel component.
In addition, Q Club Hotel alleges the association’s new board of directors is “illegally constituted and has lacked the authority to act since, at least, June 6, 2021, when the board was usurped by bad actors in the condominium.”
Andrew McNeil, an investor who lives in Bangkok and owns seven units, including two with a partner, is looking to cut his losses, but is stuck litigating Q Club Hotel over the sale of the condos.
In February, McNeil and his partner, Nouhad Abou Atallah, sued Q Club Hotel seeking to enforce a settlement agreement in a previous complaint requiring the hotel component owner to buy the units. The recent lawsuit accuses Q Club Hotel of refusing to consummate the deals because the plaintiffs balked at paying the hotel ownership entity more than $85,000 in unexplained “shared costs” when the transactions were set to close in January.
“I am sitting in limbo with my units empty and accruing costs,” McNeil said. “As the litigation dragged on, [Q Club Hotel] kept changing the rules more and more to put more pressure on us.”