A powerhouse investment firm has reportedly backed out of a tentative $49 million deal to purchase the Queen Mary lease and develop property around the historic oceanliner. The deal would have allowed a group calling itself Save the Queen LLC to take control of the ship and surrounding waterfront property for development into a theme resort. In a July 10 letter to an attorney representing Long Beach, Save the Queen said it was ending its bid because of what it characterized as the city's refusal to reach an agreement on key monetary issues.
Save the Queen is backed by Orange County real estate investor Jeffrey Klein, investment firm The Carlyle Group and resort developer Hix Rubenstein. "As a result of the city's failure to accept the proposal the city had indicated it required, Carlyle decided not to proceed with the transaction," attorney Mark Shinderman wrote to city-hired attorney Steven Gubner. In response to the letter, the city issued a tersely worded reply to Save the Queen's backers Wednesday accusing the group of leaking confidential details about the proposed deal.
"We will no longer be negotiating with Carlyle because of what we believe is their clear violation of a court-ordered confidentiality agreement," Long Beach City Attorney Bob Shannon said Thursday. "We also don't agree with their characterization of the negotiations in the letter." Shannon also indicated the city is considering legal action for what he described as a breach of confidentiality.
The city has been working to court a new developer for the 55-acre site since Queen Seaport Development Inc., which leases the site, entered bankruptcy in March 2005 following a dispute over rent payments to the city. Long Beach owns the Queen Mary, but signed a 66-year lease with QSDI for maintenance and development several years ago.
Following the bankruptcy filing, a court-appointed trustee, Howard Ehrenberg, was put in charge of resolving QSDI's outstanding debts and finding new investors for the site. Klein, who heads Save the Queen, said earlier that his team envisioned the project as a resort with hotels, a marina and bay club in addition to a mixed-used development similar to Universal Studios City Walk. A powerhouse investment firm has reportedly backed out of a tentative $49 million deal to purchase the Queen Mary lease and develop property around the historic oceanliner.
News RSS