The hotel, that was to be built by local developer Richard Weintraub, had been 10 years in the planning process.
By Olivia Damavandi / Staff Writer
More than a decade after the project received city approval, plans by local developer Richard Weintraub to build the 146-room Adamson Hotel have come to a halt due to a mortgage debt of $21.5 million. In addition, a company controlled by Weintraub has filed a lawsuit against Ezri Namvar, joint-venture partner in the project.
The 28-acre triangular lot, formed by the intersection of Pacific Coast Highway, Malibu Canyon Road and Civic Center Way, which was to house the hotel has been put up for sale due to $21.5 million in mortgage debt.
The suit was filed by REB Malibu LLC, Weintraub’s entity in the Rancho Malibu LLC joint venture with Dimes LLC, owned by Namvar, on June 17 in Los Angeles Superior Court. The lawsuit claims Namvar and others named in the lawsuit devised a kickback scheme in the planned sale of the property, from which Weintraub would not have received any proceeds.
Legal responses to the lawsuit will be made later this month.
Dimes and PFS Holdings LLC, a third partner in the joint venture called Manhattan Partners LLC, and three other individuals are named in the lawsuit.
The suit alleges in detail a scheme in which PFS Holdings LLC would enter into an agreement to buy the property for $32 million and then assign it to another unnamed buyer who would pay a secret kickback to Namvar and others.
Namvar’s business in the last half of 2008 collapsed during the real estate downturn, according to the Los Angeles Business Journal. His main company, the bankrupt Namco Capital Group Inc., owes more than a half-billion dollars to 464 creditors. Namvar, who had a local real estate empire valued at $2.43 billion last summer, also apparently owes a large amount personally, according to the Journal.
Kasey Diba, attorney for PFS, did not return phone calls from The Malibu Times, but in an interview with Los Angeles Business Journal called the allegations “unmerited” and said the lawsuit is a result of what appears to be “internal dissension” among the members of Rancho Malibu. Diba said PFS made the offer to purchase the property in good faith and his client’s only involvement was “an offer to purchase the property in dispute.” He declined to comment further.
Attorneys for Namvar could not be reached for comment. Weintraub, his attorney, Gregory Gershuni, and his publicist, Fiona Hutton, declined to comment.
While the matter remains under legal investigation, many have questioned what will become of the vacant lot. According to California Coastal Commission documents, Rancho Malibu planned to build the hotel at 24111 Pacific Coast Highway near Pepperdine University.
“The Adamson Hotel was to be a luxury hotel, which in today’s marketplace would be very difficult to finance,” resident and local Realtor Tony Dorn said Tuesday in a telephone interview.
“The proposed Adamson Hotel is the largest city-approved development of its kind that would have been built from the ground up,” Dorn said.
The city council approved the hotel construction in 1998 for the Adamson family, who at the time owned the property. Weintraub purchased the land the following year.
Weintraub’s plan called for a hotel divided into 16 villas ranging in size up to 6,000 square feet each that would surround private courtyards. The proposed architectural style of the project was along the lines of a Southern California garden hotel with a historic Spanish Mediterranean character. Weintraub in 2007 said the Hotel Bel-Air in Stone Canyon is an example of the feel he wanted to achieve.
The approval process for the Adamson Hotel had been particularly long and arduous. The original development began in the 1970s under the county, with a proposal for a 300-room hotel. The project received county and California Coastal Commission approval, but when Malibu became a city, everything came to a halt.
The initial city permit application was filed for review in August 1994, and, thereafter, went through a city planning and state environmental review process. Hearings then took place before the Planning Commission and the city council, and the project received its final city approval in 1998.