Chetrit’s lender alleges it stole $2M insurance payout for South Beach hotel damage

Joseph Chetrit with the Tides Hotel
Joseph Chetrit with the Tides Hotel (Getty, Tides via Facebook)

Foreclosure suit was filed earlier this year

Chetrit Group’s new lender alleges that the New York real estate firm stole $2 million in insurance money tied to damages at the long-shuttered Tides South Beach hotel, court filings show.

The latest allegations are part of a $45 million foreclosure lawsuit filed earlier this year by Safe Harbor Equity affiliate SHEDDF3 VNB LLC against CG Tides and other companies linked to the Chetrit Group over the loan backing the 11-story hotel at 1220 Ocean Drive.

Ocean Bank provided the financing in 2014, and the principal on the loan was due in December, according to the original complaint. Ocean Bank sold the debt to the Safe Harbor Equity affiliate in January. The loan is backed by the Art Deco hotel on Ocean Drive, plus a mixed-use building fronting Collins Avenue that Chetrit redeveloped.

Safe Harbor alleges that Chetrit defaulted on its loan when it allegedly pocketed the insurance check without the lender’s knowledge or consent. Safe Harbor is alleging that the default on the loan triggered Chetrit’s contractual obligation to pay interest from that date.

Joseph Chetrit, a founding partner of the family-owned company, did not immediately respond to a request for comment. Safe Harbor declined to comment.

The Chetrit entity filed a motion for partial summary judgment in March, based on its argument that it did not default on the loan. “Safe Harbor cannot seek default interest based on that nonexistent default,” CG Tides is alleging.

By Katherine Kallergis for 
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