The Elser Hotel & Residences, a 646-unit condo-hotel tower in downtown Miami, has become the site of a tangled legal war between developer Property Markets Group and the condominium association representing its unit owners. In recent months, the two sides have filed dueling lawsuits over control of the building's parking garage, disputed storage fees, and hundreds of thousands of dollars in withheld hotel management revenue. The fight traces back to the tower's earlier life as a planned rental building before it was converted into a flexible short-term rental condo-hotel.
According to The Real Deal, the 398 NE 5th Street Condominium Association first sued the developer in early 2025 over voting rights and leasing and rental restrictions. That case ended in a November 2025 settlement agreement granting PMG's commercial-parcel affiliate the right to all revenue generated by the parking garage, and the underlying lawsuit was later dismissed with prejudice. Since the settlement, unit owners have borne the garage's full operating costs while the PMG affiliate has retained all of the garage's revenue, according to the association's own lawsuit.
A New Round of Lawsuits Over Garage Money
On June 5, the PMG affiliate notified the association that it intended to begin collecting assessments directly from unit owners, per the affiliate's own account. On July 3, the association told unit owners to disregard a payment notice from Black Briar Management, which had directed owners to use its own payment portal instead. The PMG affiliate has alleged that the association, together with property manager RealManage, ran a scheme that billed owners at an outdated 2025 assessment rate rather than the roughly $350,000 per quarter called for, per the complaint.
That allegation prompted the PMG affiliate to sue the association, RealManage and board president Steve Hardee, accusing them of diverting fees owed to the developer. Hardee, the lawsuit claims, instructed Highgate Hotels not to release roughly $773,000 in hotel management fees to the developer without written association approval. PMG has said it plans to pursue additional claims for conversion and fraud tied to the commercial parcel's dues and what it describes as theft of hotel management revenue. Earlier this month, the association countered by suing the PMG affiliate for alleged breach of contract.
Storage Space and a Parking-Tech Dispute Pile On
Last Sunday, the PMG affiliate filed a separate suit against the association over storage space inside the garage, alleging the association owes roughly $35,000 in unpaid storage fees. The association had requested a 6,870-square-foot storage unit on the garage's top level and agreed to pay $5,000 a month for it starting in February. Separately, the association alleges that the PMG affiliate's decision to hire Metropolis to install a license-plate recognition system breached the settlement agreement, even though the affiliate had agreed to install the system at its own expense and to submit any parking operator to the association for approval. Josh Rubens said the PMG affiliate strongly disputes the association's claims regarding the parking operator.
The association's lawsuit also accuses RealManage of failing to provide records showing what it collected from each unit owner, describing the records it did receive as confusing, deficient and incomplete.
A Rental Tower's Rocky Path to Condo-Hotel Status
The Elser was originally planned as a rental building. PMG and partner Greybrook converted the project into a flexible short-term rental condo-hotel in July 2022, and PMG completed the 49-story tower at 398 NE 5th Street later that year.
Beyond its 646 residential units, the building includes a parking garage, office space and a church. PMG bought the site for $55 million in 2018 from First United Methodist Church of Miami, agreeing to build a 22,000-square-foot sanctuary on the tower's lower levels.
Florida Lawmakers Already Rewrote the Rules Once
The legal fight is unfolding against a shifting statutory backdrop. Florida's legislature codified commercial lot owners' greater authority over shared spaces in condo-hotels in 2024, only to scale it back the following year. In May 2025, lawmakers passed House Bill 913 and Senate Bill 1742, eliminating the retroactive reach of that 2024 law and clarifying that commercial lot owners hold exclusive control of shared spaces only in condo-hotels with declarations recorded on or after October 1, 2024 — a cutoff that places the Elser's earlier declaration squarely in the murkier, more heavily litigated category.
PMG's Footprint Extends Well Beyond the Elser
PMG, founded in 1991 and led by CEO Kevin Maloney alongside managing partners Ryan Shear and Dan Kaplan, has built more than $12 billion in real estate assets and carries a national development pipeline exceeding 10,000 residential units, according to Commercial Observer. The developer is simultaneously building the 100-story Waldorf Astoria Hotel & Residences one block from the Elser, a project that landed a South Florida-record $668 million construction loan in June 2024, and is also developing the planned Delano Residences Miami supertall next to the Elser's sales center.
The Elser dispute also fits a broader pattern of Miami condo-hotel litigation. Nearby, the condo association at the 66-story Aston Martin Residences sued its developer in February over an alleged self-dealing scheme and missing turnover records, while the association at the Marquis Miami condo-hotel recently sued Madison Realty over commercial-unit management and fee allocation. Further back, a Miami-Dade jury awarded unit owners $16.3 million in December 2022 in a similar dispute at the Carillon Miami Wellness Resort, after finding the commercial lot owner had overassessed associations for shared spa and hotel amenities, according to The Real Deal.
Hotel Operations and Award-Winning Amenities Roll On
Even as the litigation piles up, day-to-day hospitality operations at the Elser continue under Highgate, the global hospitality company that manages more than $15 billion in real estate assets across 400 properties worldwide and appointed Sean Flanigan as vice president of operations and acting managing director in May 2025, according to Highgate. In mid-July, Highgate rolled out Innspire's "Guest Flows" digital management system across the property's units, letting hotel guests check in, request service and receive digital keys without downloading an app.
The building's amenities have kept drawing attention of their own. Earlier this month, ViceVersa, the Italian aperitivo bar in the Elser's ground-floor lobby, was named Best U.S. Hotel Bar at the 20th annual Tales of the Cocktail Spirited Awards in New Orleans. The hotel's rooftop pool has also hosted World Cup viewing parties, underscoring how much commercial activity is riding on a building whose ownership structure remains tied up in court.
