Sale of Naples Beach Hotel property held up by legal challenge

The long-anticipated sale of the landmark Naples Beach Hotel property has hit a snag. 

The sale didn't close as planned last week, held up by a last-minute legal challenge and claim from a nearby resident.

Gregory Myers, who lives on Gulf Shore Boulevard, filed a lawsuit on May 27 in Collier Circuit Court, alleging his private property rights have been violated.

Based on publicly recorded plats and easements, he asserts that he has an interest in the land, although he doesn't technically own any of it. 

With that interest, Myers contends he should have more power to determine what becomes of the property, which is slated for redevelopment.

The claims in his lawsuit include slander of title and nuisance. 

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Myers could not be reached for further comment.

He's sued both the buyers and the sellers of the 125-acre property, through their affiliates.

Court records show he's representing himself.

The buyer, The Athens Group, plans to raze the beach hotel and build a five-star 220-room resort with "best-in-class" residential condos along both sides of Gulf Shore Boulevard North. 

In a brief statement via email, Kim Richards, The Athens Group's CEO, confirmed the sale didn't go through.

“The closing of our acquisition of the Naples Beach Hotel has been temporarily delayed by the filing of a last-minute lawsuit and lis pendens. We look forward to resolving this matter as soon as possible," he said. 

Property records show Myers also filed a notice of lis pendens in Collier Circuit Court.

The lis pendens is an official public notice of a lawsuit. A claimant can use it to place a cloud on the title of a property in question until the suit is resolved. It can hold up a sale because it can create more hurdles for both the buyers and sellers.

The Naples Beach Hotel permanently closed on May 23, ending a 75-year run by the Watkins family, who owned and operated the resort property for three generations.

The family declined to comment about the unexpected legal woes.

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The redevelopment plans have faced neighborhood opposition.

Along with others, Myers has aired his concerns about the planned redevelopment at City Council meetings multiple times, including his objections to any major changes to the championship golf course.

In his suit, Myers claims he has a right to the "reasonable use and enjoyment of the land," including its streets, avenues and driveways.

Myers has demanded injunctive and declaratory relief from the court, seeking to prevent the sellers and buyers from recording any new agreements related to the easement property, including financing statements or property deeds. 

When real estate changes hands it's usually done through a deed.

In the suit, Myers alleges a development agreement the buyers struck with the city is illegal, and that he has a "vested right" to have the golf course and its clubhouse and driveway remain in their current use "only."

He also contends he has the "right to an unobstructed view of the Gulf of Mexico," which is threatened by the new mixed-use development.

Myers claims he'll "suffer irreparable harm" if the court fails to grant him his requested relief.

"An injunction will serve the public interest as the easement property is to remain available to 'the use of the public forever,"' he states

In a separate, but related action, Myers recently appealed a decision by the city's Design Review Board to approve a renovation and expansion of HB's, a popular waterfront eatery, on the resort property, He lost that fight.

Sitting as the board of appeals, City Council unanimously upheld the approval of the planned improvements to the restaurant last week.

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At that hearing, Myers claimed his easement rights would be violated with the rebuild, similar to the argument he's making in his new lawsuit.

The Athens Group plans to continue operating HB's not just for its guests and residents, but for the community. However, it's closed for now, along with the golf course, in anticipation of the sale and future improvements.

Before voting against the appeal, City Councilman Paul Perry said Myers had a "private property dispute" that could be resolved in court.

"We, as the appellate board, have no authority to resolve private property disputes," he said.

In 2019, when a previous Naples City Council approved the plans to redevelop the hotel, it agreed to accept an easement from The Athens Group that would allow the city to preserve the golf course as open green space.

The current Council has been looking to strengthen that easement, through the involvement of a land trust.

That will require more negotiations with and cooperation from the developer.

For now, the developer is focused on completing the sale.