Cranes sat idle with few workers on site in July at the Mandarin Oriental, but in the city’s overall view, ‘they are actively doing work’ on the project. Jerry Lower/The Coastal Star
Company, developer say they remain committed to project
By Mary Hladky
It’s all the buzz in Boca: What’s going on with the Mandarin Oriental?
Speculation and rumors abound. Chief among them are that Mandarin Oriental has pulled out of the luxury hotel and condo project and that developer Penn-Florida Cos. is having trouble refinancing.
But Mandarin Oriental officials say the company remains onboard. “We have had some delays, but the project is still moving forward,” Chris Orlikowski, director of global communications, said in an email.
And Penn-Florida denies money problems. “Financing is not an issue for this project,” Elizabeth Cross, vice president of marketing, said in a written response to questions.
Yet construction has been exceptionally slow. When Penn-Florida announced the Mandarin Oriental Hotel and branded residences in 2015, officials said the project would be completed in 2017. That date was pushed back three times.
In late March, Penn-Florida Chief Operating Officer David Warne told The Coastal Star and other media outlets that the hotel and condo buildings would be completed by the end of this year.
“There is no chance” of that, said a developer who, like many others contacted by this newspaper, did not want to be quoted by name.
“It is impossible,” said an architect.
The completion date since has been moved to an unspecified time in 2024.
Construction has been on again, off again. Work slowed to all but a halt this spring. When The Coastal Star visited the construction site along Federal Highway just north of Camino Real three times in July, only a few workers were on site. Cranes sat idle.
The only visible progress during the month was the installation of more windows and the delivery of additional windows that were stacked on the ground floor, along with some newly arrived building supplies.
“People know there is something wrong,” said another developer.
Prestigious addition to city
This has triggered outsize concern because Mandarin Oriental isn’t just another hotel. Its reputation rests on luxury, elegance and sophistication.
Rarity adds to the allure. Mandarin Oriental has only 36 hotels worldwide. Nine branded residences are in operation, with more in development.
That a mid-size city like Boca Raton could snare one thrilled officials and residents. It would elevate the city to the ranks of those such as Paris, London, Geneva and Hong Kong that have Mandarin Oriental hotels.
“When open, this magnificent five-star luxury urban destination will transform Boca Raton’s place on the world’s stage,” Cross wrote. “It will inject its economy with vibrant new jobs and higher levels of sophistication, and welcome some of the most prestigious guests/residents from around the globe.”
She acknowledged one construction delay, prompted by a redesign of the rooftop pool and amenity decks on both buildings. “The redesign warranted structural modifications which are just now being completed,” she wrote. While that was taking place, “construction efforts were redirected towards progress on the project’s interior work.”
Hotel pools manufactured in stainless steel by Myrtha Pools are on their way now from Italy and the condo pool will come soon after, she said.
Typical job listings absent
Peter Ricci, director of Florida Atlantic University’s Hospitality and Tourism Management program, has long been puzzled by the project’s slow progress. When a hotel in the area is about to start operation, company officials post job openings with FAU about six months in advance.
Mandarin Oriental has not done so, he said.
Warne said in March that a general manager, director of food and beverage and director of finance had been hired, but Ricci said the general manager has left and is now at another Mandarin Oriental property.
Cross confirmed that the general manager had departed “for personal reasons,” but said he no longer works for Mandarin Oriental Hotel Group. The other executives remain in place, she wrote.
From the city’s perspective, the project is moving forward. “They are actively doing work,” said city spokeswoman Anne Marie Connolly.
Those involved in the project meet semi-regularly with city staff, she said, and building permit records show that inspectors are visiting the site to make sure the work has been done correctly.
But those records also show that the project is a long way from being completed. Only one portion of it is 100% finished.
Lawsuit dragged into 2023
The project has been beset by difficulties for years, according to a 2018 lawsuit filed in Palm Beach County Circuit Court by Pirunico Trustees against companies connected to Penn-Florida President and CEO Mark Gensheimer.
A counterclaim by those companies against Pirunico states that European real estate investor Cyril Dennis, now deceased, wanted to develop what is now the Mandarin Oriental project, which also includes the completed 101 Via Mizner luxury apartment building immediately south of the hotel site.
In 2006, he persuaded Gensheimer to invest in the project and complete it. But a management dispute arose, resulting in the litigation.
The recession of 2008 delayed construction and made it difficult to keep the project afloat. Disputes among the parties to the project made it harder to obtain financing, but in 2012, Gensheimer was able to obtain refinancing that avoided “catastrophe,” according to the counterclaim.
The parties settled the case last September and asked the judge to stay it until “transactions” that are part of the settlement agreement were completed in June. The case would then be dismissed. The court record does not yet show if that happened.
While the litigation would seem to have no bearing on the project’s current construction schedule, some of those who spoke with The Coastal Star think its existence makes it more difficult to get financing or refinancing.
Cross denied that. “It does not/has not had any impact on the operations, construction or the completion of the project,” she wrote.
The first phase of the project, 101 Via Mizner with 366 units, was completed in 2016.
The 164-room hotel will include a luxury spa and private Via Mizner City Club. Members will have access to the hotel’s rooftop pools, spa, restaurants and bars.
The 85 residences will range in size up to more than 10,000 square feet and feature private elevators, terraces, outdoor kitchens and a skybridge which connects the residences to the hotel. Almost all are sold, Warne has said.
About 65,000 square feet of retail will be part of the project.
The Golf Club, with an 18-hole course redesigned by Jack Nicklaus at 6200 Del Mar Drive, is already open.
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