Investor seeks $50M for allegedly botched Ocean Drive hotel repairs

New York-based firm alleges architect and engineer rammed through unauthorized demolition work at The Savoy Hotel & Beach Club

Allied Partners founder Eric Hadar and The Savoy Hotel & Beach Club at 425 Ocean Drive (Google Maps, Getty)
Allied Partners founder Eric Hadar and The Savoy Hotel & Beach Club at 425 Ocean Drive (Google Maps, Getty)

Allied Partners is seeking $50 million from an architect and an engineer who allegedly tore down portions of a historic Miami Beach hotel without the owner’s authorization.

In two separate lawsuits filed in Miami-Dade Circuit Court last month, an Allied entity sued Kevin Gore, an architect based in Palisades Park, New Jersey; and Miami-based engineer Elvis Torres and his company, Ortus Engineering.

Allied, a New York-based real estate investment firm founded by Eric Hadar, owns The Savoy Hotel & Beach Club at 425 and 455 Ocean Drive in the city’s South of Fifth neighborhood. In 2005, Allied paid $28 million for the oceanfront property, which consists of two Art Deco buildings completed in 1937 and 1941, records show.

Hadar, Gore and attorneys representing Allied and the architect declined comment. Torres did not respond to a request for comment.

In 2017, Hurricane Irma damaged the two buildings, known as Arlington East and Arlington West, the complaints state. The Category 4 storm caused significant damage to Arlington East, which has most of the Savoy’s 75 rooms. Arlington West, which houses the hotel kitchen, restaurant, cafe, an event space and 31 rooms, was damaged, but to a lesser extent, the complaints state.

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Allied has been unable to reopen Arlington East until the building is restored to its prior state, and the restaurant and event space at Arlington West also remained closed, the lawsuit states. A current estimate shows it will cost nearly $30 million to restore the two buildings to their original state, before they were demolished. The lawsuits state the Savoy Hotel also suffered $20 million in lost profits.

According to the Gore lawsuit, Allied retained the architect to create design plans and oversee the restoration of Arlington West so it could reopen. Arlington East “would be mothballed behind a firewall until a later restoration phase,” the lawsuit states.

Allied provided Gore with strict instructions to leave Arlington East alone and that he needed to ensure the renovation plans and permits for Arlington West were secured before commencing work, the complaint states. Any deviation by Gore could jeopardize a master permit Allied obtained in 2013 for “valuable redevelopment and expansion rights for the hotel,” and hurt the developer’s relationship with Miami Beach city officials, according to the lawsuit.

Allied rejected Gore’s insistence that the remediation work incorporate major elements of the master permit, including the internal demolition of Arlington East. Despite Allied’s demands that Gore stick to just repairing Arlington West, the architect expanded the project’s scope “without professional design plans or required permits” to remove rooms, concrete floors, mechanical risers, plumbing, and life and fire safety systems throughout Arlington East, the lawsuit states.

“Gore’s 11th-hour detour from the authorized plan ultimately made it impossible to reopen” Arlington West in time for the 2018 edition of the Art Basel art fair in Miami Beach, one of the busiest tourism weeks in the city, the lawsuit states. Allied also alleges that Gore’s deviation prompted the city of Miami Beach’s building department to declare Arlington East an unsafe structure that has remained uninhabitable since then.

According to the lawsuit against Torres and Ortus Engineering, the engineer and his firm negligently facilitated and enabled the internal demolition of Arlington East and Arlington West without any approved construction plans and permits. Torres and Ortus attempted to get plans approved after the demolition work had been completed, the lawsuit alleges. The engineer also allegedly assured Allied that the city would approve the plans, even though it deviated from the master permit.

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