Mi Casa, Sue Casa
The Reimagining of Versace’s Mansion as an Elite Playground Left Out a Few Details, Like Obtaining Licenses and Paying Taxes

Reto Gaudenzi became concerned that Casa Casuarina was not operating legally, despite being assured by Loftin and attorney Robert Switkes that all was well.

By Rebecca Wakefield

Casa Casuarina is a great place to party. When somebody throws a do there, the food and alcohol offerings are always top-notch. Thus it has been, off and on, since the place was built in 1930. In 2000, telecommunications billionaire Peter Loftin bought the Ocean Drive mansion from the estate of murdered fashion icon Gianni Versace.

He proceeded to hire people to make the place just as fabulous, but also profitable, by converting it to a private club for jet-setters who could afford the five-figure membership fee, for exclusivity and the opportunity to rub elbows with party-hardy celebrities like Shaq and Jamie Foxx. But now, an employment dispute between Loftin’s party palace and a former employee has exposed back-of-house problems at the Casa, including the startling accusation that Casa Casuarina is operating without the required hotel, restaurant or liquor licenses.

Two years ago, Reto Gaudenzi was recruited by Casa Casuarina to help convert the former private home to an exclusive club with restaurant, lounge and hotel facilities. Things went swimmingly for more than a year, when, according to Gaudenzi’s legal complaint, he began questioning “illegal activities” taking place at the club. He claims Loftin subsequently fired him as managing director via a fax sent to a European hotel where he was staying. The matter is currently in arbitration. “I don’t think we have any comment on that,” said a representative of Casa Casuarina, who described herself as the marketing director, yet declined to provide her name. (A followup call to Casa Casuarina confirmed that Carmen Casadella is director of marketing.)

Gaudenzi was ostensibly fired for financial improprieties, including receiving three months worth of payments to which he wasn’t entitled and unreimbursed personal expenses. The total is about $81,000, according to Casa Casuarina. Gaudenzi disputed that claim and won compensation for the early termination of his contract.

Gaudenzi is an old hand in the elite hotel and club business, having spent more than 30 years running or promoting such places all over the world, from St. Moritz to Berlin, Greece, Saudi Arabia and Kenya. The 54-year-old Switzerland native’s track record has put him in numerous society pages from Miami to Palm Beach to New York and Europe. He organized the first Miami Beach Polo Cup on the sand across Ocean Drive from Casa Casuarina.

But according to documents his attorney has filed, Gaudenzi became concerned that Casa Casuarina was not operating legally, despite being assured by Loftin and influential Miami Beach attorney Robert Switkes that all was well. His concerns were backed up by city officials, who cited Casa Casuarina a couple of times last year for operating a hotel without an occupational license and for holding special events without a permit.

One code violation for Casa Casuarina issued during last year’s Winter Music Conference notes that attorney Switkes allegedly spoke to City Manager Jorge Gonzalez to get the go-ahead for a music event there, even though they had no permit. The code officer also observed: “I asked a man at the party if the drinks were free. He said no. He said the one in his hand was $12.”

Gaudenzi maintains that Switkes told him that to keep selling alcohol, they needed to set up a separate company, Lifestyle Catering, LLC, with Gaudenzi as the front man. (Switkes did not return phone messages seeking comment.) This company was used solely to buy alcohol to resell at the club. In the setup, Loftin’s company, C&M Aviation, could buy the company from Gaudenzi at any time for one dollar. Casa Casuarina would deposit money into the account of the front company, and Lifestyle Catering would cut checks to a liquor wholesaler. The booze would travel back to Ocean Drive, where lucky saps would line up to pay $12 or more for drinks. All this, if proved true, would be illegal.

Gaudenzi’s attorney, Sean Ellsworth, deposed an assistant managing director of Casa Casuarina, Jose Flores, in May. Flores said in the deposition that he personally wrote checks from Lifestyle Catering to Sunset Corners, a liquor store in South Miami. He recalled writing somewhere between a half dozen and a dozen of these checks. Ellsworth then asked Flores whether Casa Casuarina had a liquor license. Flores said it didn’t.

Ellsworth asked how many employees Lifestyle Catering has. “To my knowledge, none,” replied Flores. Ellsworth also asked whether the company had ever purchased any food, or actually catered any events. No, it hadn’t, Flores said.

Why doesn’t Casa Casuarina have a hotel license, despite advertising itself as a member of The Leading Hotels of the World? According to e-mails from various city officials, including Planning and Zoning Manager Richard Lorber, the place hasn’t been able to satisfy the building and fire codes. “Basically, they can only use the place now with a special events permit,” Lorber wrote last September. “They have used up their 5 [allowed per year], and can only get more at the grace of the [city] manager.” Lorber then added: “We have been helping them, but then we read an article in the New York Times saying they’re operating the hotel already, when they don’t have a license one [sic], and it’s ridiculous.”

A later e-mail from Lorber to city colleagues noted that hotel reservations were available for $1,200 to $4,000 a night. Casa Casuarina applied for a hotel and restaurant license from the city in February 2006, but to date, it still doesn’t have one.

As to the liquor license, the state issued a retail beverage license to Casa Casuarina in December 2004, but the license became inactive just a week later because the business didn’t get the necessary city approvals. Ellsworth recently lodged complaints with both the Florida Division of Alcoholic Beverages and Tobacco and the state’s Department of Business and Professional Regulation.

Inquiries made to the city regarding how Loftin et al. have gotten away with this weren’t answered by press time.

Earlier this year, Loftin was honored by the city of Miami Beach for various charitable contributions. The Casa Casuarina Web site crows that the city honor included a note about the place being the “leader of Miami’s new ultra-elite identity, bringing a new level of sophistication to Miami Beach and attracting the height of international society to the city.”

But if Loftin is running his hotel/club without the proper licenses, he’s probably not paying all the taxes (such as sales, liquor and resort taxes) levied on legitimate operations. Now I know what “ultra-elite” means. The rules don’t apply.

(With thanks to J.P. Morgan of www.citydebate.com )

Comments? E-mail wakefield@miamisunpost.com.