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Yacht Haven Principals Downplay Reports, Announce Efforts to Restructure Debt

May 2, 2008 — A recent story on Bloomberg.com indicating the multi-million dollar Yacht Haven Grande property might be in financial trouble is "much ado about nothing," a spokesperson said Friday.
The article, published Thursday, says Yacht Haven Grande principal Andrew Farkas is currently in talks with lenders to "avoid the bankruptcy of his year-old mega yacht marina complex" on St. Thomas. Yacht Haven has suffered "economic difficulties," and its principal is expected to strike an agreement with banks "soon, so it won't be forced to seek protection from its creditors," the article says, quoting Farkas' spokesman, Howard Rubenstein.
But there is "no expectation or intention" of bankruptcy, said Yacht Haven President Charles Garner on Friday. Instead, Island Capital Group — Yacht Haven's parent company — is in "friendly" talks with three banks out of Puerto Rico for funds needed to make additional investments in the property, he said.
"We have seen sales rise from the beginning and end of our winter season," Garner said during a telephone interview. "If we want to build on that, we have to continue to build the property."
New additions at Yacht Haven would range from "replacing lights to you have it," Garner said. The money needed for the upgrades is in the "single-digit millions," he explained.
The mortgage on the property is $100 million, Garner said. The company is currently in negotiations with its lenders to "restructure the terms of its debt," according to a statement issued late Friday afternoon by Yacht Haven Grande.
The 360-degree restaurant on the property has not yet been completed, and Chico's — a national franchise women's clothing store — recently pulled out of the facility after a year. Few of the multi-million dollar condos at Yacht Haven have sold.
"I expect that we will reach an agreement with the banks and that they will agree with us on the terms so we can make this happen," Garner said. "The parents of Yacht Haven have more than enough money to do it and are happy to do it."
The ongoing negotiations do not "affect the ongoing operations at Yacht Haven Grande, and do not affect staff levels or operating hours," according to the statement released Friday.
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