UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF FLORIDA

MIAMI DIVISION

www.flsb.uscourts.gov

In re: Chapter 11

AVENTURA HOTEL PROPERTIES, LLC, Case No. 21-12374-BKC-RAM

TRIPTYCH MIAMI HOLDINGS, LLC, Case No. 21-12375-BKC-RAM

 

 Debtors. (Jointly Administered Under

____________________________________/ Case No. 21-12374-BKC-RAM)

DECLARATION OF FRANCISCO AROCHA, AS MANAGER OF 

AVENTURA HOTEL PROPERTIES, LLC AND TRIPTYCH MIAMI HOLDINGS, LLC,

IN SUPPORT OF THEIR CHAPTER 11 PETITIONS

I, Francisco Arocha , submit this declaration (“Declaration”) pursuant to 28 U.S.C. § 1746

in support of the Chapter 11 Petitions for Aventura Hotel Properties, LLC and Triptych Miami 

Holdings, LLC, and state as follows:

1. I am a Manager of Aventura Hotel Properties, LLC (“AHP”) and Triptych Miami 

Holdings, LLC (“TMH”) since their inception. 

2. I am also the Managing Partner and CEO of HES Group1, a multinational, family 

owned and operated business that has been involved in real estate development, management and 

related food and beverage and entertainment ventures. In 1998, HES Group was founded in 

Caracas, Venezuela and later moved our headquarters to Miami, Florida. From our offices in 

Brickell, we have developed and operated branded hotel, real estate, and food and beverage 

concepts in South Florida and the Caribbean including hotels in Florida (Brickell and Coral 

Gables), the Dominican Republic (Santo Domingo) and Venezuela (Caracas and Maracay). We 

 

1 HES Group is the trade name for an umbrella of related companies that include HES Group Holding, 

LLC, HES Management and Services, LLC, HES Consulting Group, LLC, HES Hospitality, LLC and 

HES Triptych Holdings, LLC. 

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also proudly manage a MLB affiliated Venezuelan baseball team. Our past ventures included a 

vineyard in Spain and a brewery in Doral, Florida.

3. HES Group manages the business affairs of Debtor AHP and its efforts to develop 

a mixed-use project located in the hub of the city’s three most dynamic and creative new 

neighborhoods: Miami Design District, Wynwood Art District, and Midtown/Edgewater Corridor 

(the “Triptych Project”). 

4. Debtor AHP acquired an assemblage of land2for purposes of developing the 

Triptych Project, a 475,000 square foot 3-unit condominium mixed-use project having (a) a 297-

bedroom full-service lifestyle hotel, (b) approximately 40,000 square feet of premium retail space

and 60,000 square feet of AAA office space, and (c) a structured parking garage with 

approximately 400 parking spaces. Debtor TMH, in turn, owns 100 percent of the membership 

interests in Debtor AHP.

5. The Debtors routinely utilize HES Group’s employees and organizational resources 

in connection with the Triptych Project. For example, HES Group supports the Triptych Project 

by providing the Debtors with professional services and operational support that include office 

space, accounting support, contract management, due diligence services, development and project 

management, and branding expertise. 

6. The Debtors are organized as single-asset entities for purposes of project 

management and capital financing, but they otherwise function as a corporate division of the HES 

Group. In these Chapter 11 cases, the HES Group will continue to provide operational support to 

 

2 The subject real estate is a 0.99-acre, high density, mixed-use zoned site located at 3601, 3610, 3630, 

3651, and 3701 North Miami Avenue in Miami-Dade County, Florida. A total of nine parcels were 

purchased by AHP LLC totaling 44,783 square feet and identified as follows: Folio numbers 01-3124-026-

0010; 01-3124-026-0050; 01-3124-026-0060; 01-3124- 026-0070; 01-3124-026-0150; 01-3124-026-0160; 

01-3124-026-0170; 01-3124-026-0030; 01-3124-026-0040.

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the Debtors. Notably, HES Group continues to successfully develop and operate hotel properties 

in South Florida notwithstanding the challenging economic conditions set forth, in more detail, 

later in this declaration. As recently as March, 2021, HES Group launched the 160 room Indigo 

Hotel by Intercontinental, a new hotel property in Miami’s Brickell neighborhood. 

7. As of the Petition Date, the Debtors rely on the management team at HES Group. 

Post-petition, HES Group will continue to manage the Debtors’ day-to-day operations.

Figure 1: Rendering of Triptych Project

8. I have personal knowledge of the Debtors’ business, their books and records, dayto-day operations and financial affairs. I am qualified to make this Declaration.

9. On March 12, 2021 (the “Petition Date”), the Debtors commenced the above 

referenced cases (the “Chapter 11 Cases”) by filing voluntary petitions under chapter 11 of title 11 

of the United States Code (the “Bankruptcy Code”) in this Court. The Debtors intend to operate 

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their businesses and manage their assets as a debtor-in-possession under the Bankruptcy Code. 

10. To minimize the adverse effects of the Chapter 11 Cases, the Debtors anticipate, 

with the assistance of its bankruptcy counsel, filing certain pleadings seeking authority from the 

Court to allow the Debtors to meet their ordinary obligations and fulfill their duties as a debtorsin-possession. 

11. I submit this Declaration in support of the Debtors’ (a) voluntary petition for relief 

filed under chapter 11 of the Bankruptcy Code; and (b) the Debtors’ Expedited Application for 

Authority to Employ and Retain, on an Interim and Final Basis, Jesus M. Suarez and the Law Firm 

of Genovese, Joblove & Battista, P.A. as Counsel for Debtors-in-Possession effective as of March 

12, 2021 (the “GJB Application”). 

12. Except as otherwise indicated, the facts set forth in this Declaration are based upon 

my personal knowledge of the Debtors’ business operations, my review of relevant business 

records of the Debtors, and other information provided to me or verified by others under my 

direction and control. Unless otherwise indicated, the financial information contained in this 

Declaration is unaudited and, due to the exigent circumstances facing the Debtors and the urgent 

need to file this Chapter 11 Case, certain of the information contained herein is subject to further 

verification. 

13. I am authorized to submit this Declaration on behalf of the Debtors, and if called 

upon to testify, I would testify that the facts set forth herein are true and correct.

Preliminary Statement

14. In July 2014, AHP acquired the land at 3601 N. Miami Avenue, Miami, Florida 

33127 (the “Land”) for purposes of developing the Triptych Project. The Land is encumbered by 

(i) a first mortgage loan in the principal amount of $15 million; (ii) a subordinated second mortgage 

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loan in the principal amount of $8.2 million; and (iii) certain limited non-revenue generating 

parking and billboard easements. As of December 2019, CBRE appraised the Land on “as is” 

basis at $42 million. AHP also has substantially completed design documents for the Triptych 

Project. 

15. AHP anticipated obtaining construction financing and breaking ground on 

construction of the Triptych Project in October of 2020. The COVID-19 pandemic, however, 

frustrated its ability to close on a construction loan and has affected the development of the 

Triptych Project in almost every respect. In August 2020, the first mortgage holder filed a 

foreclosure action against AHP seeking to foreclose its lien on the Land. Thereafter, AHP’s 

development efforts have been further complicated by market volatility associated with the 2020 

U.S. presidential election and subsequent events, and the unpredictability associated with ongoing 

pandemic-related volatility. 

16. Notwithstanding the above issues, AHP has been actively pursuing financing in 

order to recapitalize and continue development of the Triptych Project. In the alternative, AHP is 

prepared to propose a sale plan that will permit it to unlock the significant equity in the Land, 

which could exceed $20 million according to the most recent CBRE appraisal, and maximize its 

assets for the benefit of all stakeholders, including secured and unsecured creditors and equity

holders. Thankfully, the Land is in a singularly desirable location at the crossroads of three 

refulgent neighborhoods in Miami – itself the hottest real estate market in the United States. 

17. The Chapter 11 Cases will enable the Debtors to obtain the funding they need to 

market the Land for sale or solicit a new capital partner. Additionally, HES Group has committed 

to finance the costs of the reorganization proceeding in the form of debtor-in-possession financing

and operational support that, subject to approval of the Bankruptcy Court, will permit the Debtors 

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to finance the Chapter 11 Cases. 

I. OVERVIEW OF THE DEBTOR’S HISTORY AND BUSINESS OPERATIONS

A. The Corporate History and Corporate Structure of the Debtors

18. AHP is a Florida limited liability company organized on January 9, 2013 and later 

utilized to acquire, develop, construct and operate the Triptych Project. Debtor TMH is an entity 

that exists solely to hold 100% of the membership interests of Debtor AHP. The Debtors are 

headquartered at the offices of HES Group, located at 1001 SW 2nd Avenue, Suite 300, Miami, 

Florida 33126. Alberto Abilahoud and I are the managers of both Debtors. Debtor TMH is wholly 

owned by HES Miami Holdings, LLC, which itself is within the HES Group umbrella of 

companies.

B. The Debtors Business Operations and Project Description

19. On July 10, 2014, AHP acquired the Land with the proceeds of a $7.5 million 

acquisition loan from Midtown Land 8, LLC (“Kresher Capital”)3. 

20. In 2015, AHP obtained a Conditional Approval Resolution by the City of Miami 

Urban Development Review Board for the Triptych Project. Thereafter, AHP obtained an 

appraisal from CBRE that valued the Land “as is” at $27,500,000.

21. In 2016, AHP entered into a Franchise Agreement with Hilton Worldwide for the 

branding and management of a 297-room Triptych Curio Collection by Hilton Hotel (the “Hilton 

Curio Concept”). AHP invested approximately $5 million to develop the Hilton Curio Concept, 

which included obtaining architectural and engineering designs from the world-class Miami-based 

firm of Bermello, Ajamil & Associates and interior design services from Wilson & Associates. 

That same year, AHP engaged OHL Construction and entered into a LOI authorizing it to 

 

3 On August 26, 2016, Kresher Capital provided the debtor with an additional loan in the amount of $2.5 

million that has subsequently refinanced by the 21 Brands Loan (defined below).

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commence pre-construction work for the Triptych Project.

22. In 2017, AHP obtained an appraisal from Landauer Valuation & Advisory that 

valued the Land “as is” at $33,800,000. Later that year, AHP considered repositioning the Triptych 

Project to be smaller in scope, but ultimately decided against it. In November 2017, AHP 

refinanced the Kresher Loan with a $9.5 million loan from 21 Brands, S.A. in exchange for a first 

priority mortgage against the Land (the “21 Brands Loan”). 

23. In 2018, AHP received an appraisal from CBRE that valued the Land “as is” at $40 

million. On July 31, 2018, AHP entered into a $15 million first mortgage loan with LV Midtown 

LLC (“LV Midtown”) that was used, in part, to refinance the 21 Brands Loan. At the same time, 

AHP entered into an $8.2 million subordinated mortgage loan with QR Triptych LLC (“QR 

Triptych”) in exchange for AHP redeeming QR Triptych LLC’s 25% equity interest in AHP and 

cash and payment of $3 million in loan proceeds from LV Midtown.

24. On October 31, 2019, AHP executed a Term Sheet with Hyatt Franchise 

Corporation to develop and manage a Joie De Vivre by Hyatt Hotel (the “Joire de Vivre Concept”). 

In December 2019, AHP received an appraisal from CBRE that valued the Land “as is” at $42

million. 

25. The Triptych Project was expected to break ground in October 2020 and be 

completed by October 2023. However, the timeline was impacted by the COVID-19 pandemic 

that brought the world to a standstill and brought unprecedented delays and obstacles that frustrated 

AHP’s ability to obtain additional capital and construction financing to move forward with the 

development of the Triptych Project. 

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II. THE DEBTORS’ CAPITAL STRUCTURE

A. The Land

26. AHP owns the Land in fee simple. 

Figure 2A: Triptych Project Site 

Figure 2B: Triptych Project Site (Detail)

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B. Secured Loans

27. On July 31 2018, four years after AHP purchased the Land, it entered into a loan 

transaction with LV Midtown (an affiliate of Linkvest Capital Group, “Linkvest”). The purpose 

of the Loan Transaction was to recapitalize the Triptych Project. This was disclosed to the parties 

involved in the transaction, including, LV Midtown and LV Lending LLC (“LV Lending”). LV 

Lending conducted extensive due diligence related to the Land, the Triptych Project and its 

sponsors.

28. The Loan Transaction provided for LV Midtown to make a loan to AHP in the 

principal amount of $15,000,000 secured by, among other things, a first priority mortgage against 

the Land (the “Linkvest Loan”). The Linkvest Loan is also secured by a pledge by TMH of all of 

the membership interests in AHP, subject to the terms of a Pledge and Security Agreement dated 

July 31, 2018 (the “Pledge Agreement”). 

29. In connection with the Loan Transaction, and in order to facilitate the Pledge 

Agreement required by the Linkvest Loan, AHP also executed a Redemption Agreement with QR 

Triptych (the “Redemption Agreement”) that provided for AHP to redeem all of QR Triptych’s 

interests in AHP in exchange for (i) payment of $3 million from the proceeds of the Linkvest 

Loan; and (ii) AHP executing a promissory note in the original principal amount of $8,238,579 

(the “QR Note”). The QR Note is secured by a second priority mortgage against the Land and is 

subject of a Subordination and Intercreditor Agreement executed between LV Midtown and QR 

Triptych. 

C. Short Term Cash Financing. 

30. AHP’s short-term cash needs have been typically financed through interest-free 

advances from HES Group companies. In other certain instances, HES Group companies 

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advanced expenses on AHP’s behalf. AHP, in turn, repaid the advances as circumstances 

permitted. In total, HES Group companies have advanced net cash of over $3 million which 

remains unpaid. 

III. EVENTS LEADING UP TO THE CHAPTER 11 CASE

A. The COVID-19 Pandemic and Its Impact on the Real Estate and Hospitality 

Industry

31. Beginning in or about December 2019, an international pandemic of unprecedented 

scale spread across the globe, where inhabitants of all nations were affected by the virus referred 

to as the coronavirus disease 2019 (“COVID-19”). On March 11, 2020, the World Health 

Organization announced that the COVID-19 outbreak was properly characterized as a pandemic4. 

The COVID-19 pandemic resulted in global shutdowns and caused economic and commercial

disruptions in various sectors, including a heavy impact on the real estate and hospitality markets. 

The COVID-19 pandemic and the related restrictions on travel, business activity, and individual 

movement have had a significant impact on the hospitality industry.

32. Pandemic induced lockdowns, event cancellations, and stoppage of corporate 

travel affected the hospitality industry across the board. The Smith Travel Research (“STR”) data 

reflects that beginning in March 2020, occupancies began to plummet and by late March, the U.S. 

hotel industry had effectively come to a halt. According to an STR5report, in a year-over-year 

comparison with April 2019, the industry recorded a nearly 64% drop in hotel occupancy and a 

 

4 On March 11, 2020, deeply concerned both by the alarming levels of spread and severity, and by the 

alarming levels of inaction, WHO made the assessment that COVID-19 could be characterized as a 

pandemic. https://www.who.int/emergencies/diseases/novel-coronavirus-2019/interactivetimeline#

5 Founded in 1985, STR provides premium data benchmarking, analytics and marketplace insights for 

global hospitality sectors. STR was acquired in October 2019 as a division of CoStar Group, Inc., the 

leading provider of commercial real estate information, analytics and online marketplaces.

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79.9% drop in RevPAR6. According to another report by Skift Research and McKinsey & 

Company, “hotel demand may not reach pre-COVID-19 levels until 2023, while revenue per 

available room may not recover until 2024.” 

33. Throughout 2020, there continued to be extraordinary uncertainty; the crisis and 

ensuing emergency orders severely impaired the value and progress of the Triptych Design 

District Project. One example of the pandemic’s impact on the project was the standstill effect it 

had on AHP LLC’s (and its affiliate’s) negotiations with a national hotel chain. Due to the 

COVID-19 pandemic, the deadline to execute certain franchise documents was extended until 

December 31, 2020, effectively putting Triptych Design District Project, and related negotiations

with the national hotel chain, on hold.

B. Pre-Bankruptcy Restructuring Efforts 

34. In August 2020, LV Midtown initiated a foreclosure proceeding captioned LV 

Midtown LLC v. Aventura Hotel Properties, LLC et al,, Case No. 2020-018857-CA-01, pending 

in the Eleventh Judicial Circuit in and for Miami-Dade, Florida (the “Foreclosure Case”). 

Throughout the Foreclosure Case, the Debtors have attempted to negotiate an appropriate 

resolution of the Linkvest Loan that accounts for, among other things, the significant equity in 

the Land and the various alternatives. 

35. Based on the above unprecedented circumstances and disputes with Linkvest,

among other things, we determined that the filing of a Chapter 11 bankruptcy was in the best 

interests of the Triptych Project and all of its stakeholders. The Debtors seek to use the Chapter 

11 process to provide the necessary breathing room that it needs to weather the economic storm 

 

6 Revenue per available room (RevPAR) is a metric used in the hospitality industry to measure hotel 

performance. The measurement is calculated by multiplying a hotel’s average daily room rate by its 

occupancy rate. RevPAR is also calculated by dividing a hotel’s total room revenue by the total number of 

available rooms in the period being measured.

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caused by the Coronavirus pandemic, to recapitalize and continue development of the Triptych 

Project, and if necessary, facilitate a sales process for the Land that maximizes the return to all of 

its stakeholders. The Debtors anticipated that the quickly rebounding economy, especially in 

Miami, will greatly facilitate their efforts in these Chapter 11 efforts. 

IV. THE GJB APPLICATION

36. Together with this Declaration, the Debtors have filed their Expedited Application 

for Authority to Employ and Retain, on an Interim and Final Basis, Jesus M. Suarez and the Law 

Firm of Genovese, Joblove & Battista, P.A. as Counsel for Debtors-in-Possession effective as of 

March 12, 2021 (the “GJB Application”).

37. In the GJB Application, the Debtors seek authority to retain, on an interim basis

and final basis, Jesus M. Suarez and the law firm of Genovese Joblove & Battista, P.A. (“GJB”) 

as its general bankruptcy counsel. As detailed in the GJB Application, the Debtors understands 

that GJB has extensive experience representing chapter 11 debtors in this district (and other 

districts in Florida and across the country) and that they are well-qualified to serve as general 

bankruptcy counsel to the Debtor. The Debtors believe that it is in its best interest, and those of 

its stakeholders, that GJB should be retained to serve as Debtor’s general bankruptcy counsel in 

this Chapter 11 Case.

38. To the best of the Debtors’ knowledge, except as disclosed in the Declaration of 

Jesus M. Suarez on behalf of GJB attached to the GJB Application, neither Mr. Suarez nor GJB

has any connection with the Debtors, their creditors or other parties in interest in this Chapter 11 

Cases or their respective attorneys. I understand that corporations like the Debtors may not appear 

in a Florida or federal court pro se, and that only a licensed attorney may appear on their behalf. 

Because of the various obligations imposed by the Chapter 11 cases, and relief that must be sought 

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from the Court, the Debtors will suffer immediate and irreparable harm if it is unable to obtain the 

services of counsel before a final hearing on the application for approval of counsel’s employment 

can be convened. It is, therefore, my belief that only with the granting of interim approval of the 

employment of Mr. Suarez and GJB will the immediate and irreparable injury be avoided.

Accordingly, in the exercise of my business judgment, it is in the best interests of the Debtors, the 

bankruptcy estate and the creditors for the Debtor to retain GJB as the Debtors’ general bankruptcy 

counsel.

28 U.S.C. § 1746 Declaration

I declare under penalty of perjury under the laws of the United States of America that the 

foregoing is true and correct to the best of my information, knowledge, and belief. 

Executed this 16th day of March, 2021 in Miami, Florida.

/s Francisco Arocha 

Francisco Arocha

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