Times aren’t so good –– financially speaking –– at the Goodtime Hotel after a judge ordered a $204.7 million foreclosure on the South Beach property.
Los Angeles-based lender CIM Group, which provided a $152 million loan on the hotel in 2021, filed a foreclosure lawsuit in January in Miami-Dade Circuit Court against Washington Squared Owner, the hotel’s ownership entity that’s led by Eric Birnbaum and Michael Fascitelli of New York-based Imperial Companies. The suit came as CIM was battling Birnbaum and Faschitelli in New York courts over their $10 million personal guarantee payment.
The two sides have been in talks to settle their dispute over the hotel, and last month together requested a final foreclosure judgment in the Miami-Dade case, court filings show. CIM’s David Thompson and Birnbaum signed the joint stipulation requesting the foreclosure judgment, and separately also asked for pause on their New York litigation.
Judge Thomas Rebull issued the foreclosure order last week.
The $204.7 million amount in the judgment includes $149.3 million in principal balance, $32.4 million in interest, $21.1 million in default interest, $1.5 million in late fees and about $112,500 in attorney fees and court costs.
An auction is scheduled for July 1, unless Washington Squared Owner pays the $204.7 million to CIM before then. CIM can submit a credit bid on the property at the auction.
Attorneys for CIM and Washington Squared Owner declined to comment.
The developers paid $36 million in 2015 for the development site at 601 Washington Avenue in Miami Beach, completing the seven-story, 266-key hotel in 2021. The opening party received coverage in Vogue, with a guest list including celebrities such as Kim Kardashian and David and Victoria Beckham.
Much of the hype when Goodtime opened in 2021 also was over the developers’ partners: musician and songwriter Pharrell Williams, hospitality mogul David Grutman and designer Ken Fulk as partners. Grutman and Williams haven’t been involved with the hotel since 2024, a spokesperson told the Miami Herald in March.
Washington Squared Owner has been fighting off allegations of unpaid bills beyond the foreclosure case. In a suit filed in October, a company called 6 Washington Poll alleged $1.4 million in damages due to unpaid fees for services provided under a food and beverage agreement. Washington Squared Owner had a default final judgment in that case tossed, saying it’s been tied up with other pressing litigation and that 6 Washington failed to fulfill its duties under the food and beverage agreement. In its filing, Washington Squared Owner also wrote the hotel is suffering from “severe financial distress.”
Link Hospitality sued Washington Squared Owner in January, alleging more than $523,800 in unpaid invoices for temporary staff Link provided to the hotel, as well as late fees. Washington Squared Owner responded in court that Link’s invoices included errors and billed for services not provided, as well as that Link’s staff didn’t provide “services in conformity with practices current in the hotel industry.”
The hotel faced some controversy with noise over the years. Records show the developers received approval to install a noise barrier wall on the north and west sides of the third-level pool deck.
CIM, through an affiliate, originally provided a $164 million loan on Goodtime Hotel in 2021, subsequently reducing the principal to $152 million, according to its foreclosure complaint. Starting in 2023, the lender and debtor signed off on a forbearance, with the forbearance agreement amended several times after that.
In the foreclosure suit, CIM alleged that Washington Squared Owner failed to live up to the forbearance agreement, stopped paying interest in 2024 and didn’t pay off the debt when it matured that year.
In the New York case, CIM had sued Birnbaum and Fascitelli, alleging they violated their personal guarantee on the loan by failing to pay $10 million when the debt matured. At one point, Birnbaum and Fascitrelli were in talks with CIM about potentially tendering the property to CIM, including through a deed-in-lieu of foreclosure.
Birnbaum and Fascitrelli filed a counterclaim against CIM in New York court, calling the 2023 forbearance agreement “draconian” and alleging the lender exploited a drafting error in the guarantee agreement “in hopes of obtaining a windfall recovery,” court filings say. The error left the borrowers exposed to carry costs such as taxes and operating shortfalls for a much longer period of time if they were to hand over the property to the lender. It was meant to be a three-month period of borrower-covered carry costs, they said.
On Monday, the judge in the New York case granted the two sides’ request for a stay in the litigation until either they notify the court they have failed to reach a settlement, or until Aug. 27, whichever comes earlier.
