Beating Whitey

Developer Donahue Peebles is as handsome, smooth, articulate, & nasty as he needs to be

City Commissioner Saul Gross, who certainly doesn't fall into the above category, said that what he doesn't appreciate about Peebles is his litigiousness: "His style is to say he's going to sue you, or that he's going to come after you if he doesn't get his way," Gross said. "That's not a nice way to do business."

"With Don, you never know where you stand," agreed Broward County Commissioner John Rodstrom, who has also dealt with him. "He's constantly changing the terms."

"Don is a great gentleman, a great talker, and a great manipulator," said Joe Fontana, a Beach resident whom Peebles financially supported in his losing race for city commissioner against Luis Garcia. "But I disagree with his heavy-handed approach, like refusing to pay the city its lease. And he always has a different story to tell -- he tells people one thing to get what he wants, then down the road, he'll end up doing something else. His tactics aren't good for Miami Beach."

Saul Gross calls Peebles a litigious and disingenuous man
Steve Satterwhite
Saul Gross calls Peebles a litigious and disingenuous man
Simon Cruz isn't caving to the Peebles pressure, despite what Miami Beach insiders think
Steve Satterwhite
Simon Cruz isn't caving to the Peebles pressure, despite what Miami Beach insiders think

Other people have nothing but the utmost respect for Don because he doesn't pull any punches. "Don's slick and charming, but you have to love that he's surprisingly straightforward," said Michael Sasser, the former editor of the Miami Beach SunPost, a weekly newspaper known for assailing local government and the private deals it cuts.

"He's always up-front," said Adolfo Henriques, chairman of Union Planters Bank in Miami, which provided Peebles with $40 million in construction financing for the Royal Palm. "He's not afraid to tell people when they're wrong."

Don Peebles began his career in his hometown of Washington, D.C., where he worked as a legislative page on Capitol Hill, learning early that "America's business is business!" as Calvin Coolidge used to say. He attended Rutgers University in Newark, New Jersey, to study medicine, but found real estate was his true calling. After a year in college, Peebles returned to D.C. in 1982 and went to work for his mother, Yvonne Poole, a prominent real estate broker in Washington. Mother Poole also introduced Don to realpolitik as practiced in the Democratic Party: "I had a lot of high expectations," Peebles recalled, with the trademark unflinching smile. "I worked hard to achieve everything I have."

In 1983 Don capitalized on his close friendship with the city's infamous mayor, Marion "Night-train" Barry, who appointed Peebles to the city's powerful Board of Equalization and Review, a property assessment appeals board on which his mother had sat until 1980. (First elected in 1978, Barry had a reputation for cronyism and was driven from office after being videotaped using crack cocaine with a prostitute in a D.C. hotel in January 1989 -- his famous line was: "Bitch set me up!" The mayor was convicted, released in 1992, and elected mayor again in 1994.) But Don had gotten his time in, chairing the board from 1984 until 1988. Then he resigned in order to use his political experience in a tax assessment appeals business. He represented property owners before his old board, in a minor-league version of what Sen. Robert Dole and former Secretary of State Henry Kissinger had done for serious influence and profit in their national and global spheres. In the late Eighties, Peebles convinced Barry to lease office space from him in a blighted area. "Washington had a strong-mayor government with one person with the full authority to make a decision," Peebles related. "So I only had one party to deal with."

In August 1995, however, Don's relationship with Barry burned him. The city council, in a rare move against Barry, balked at a $48 million plan to lease two office buildings from Peebles. The council objected that Barry was giving away a no-bid deal to his buddy Don. To distance himself from the experience, Peebles headed for Miami Beach in December 1995 for a vacation with his gorgeous blond wife and former model Katrina, and his son, R. Donahue Peebles III. (Last year Katrina, who posed for advertisements touting Peebles's properties, gave birth to their second child, Chloe Alexandra. The couple are well known in Miami's philanthropic circles, donating their time and money to various causes, including the Miami City Ballet and the Concert Association of Florida. Don has also given $60,000, through the Miami-based Visitors Industry Council, to fund scholarships and mentorships for minorities seeking managerial positions in the hotel and restaurant industries.)

Don decided to stay in town after he read an article in the Miami Herald's Neighbors section about the City of Miami Beach's second shot at luring a black developer for a convention center hotel on South Beach. (The city had failed once before, when the HFC Group failed to get financing in 1994.) Don was instantly intrigued by the proposition and assembled a team of all-black investors: Motown Record Company chairman Clarence Avant and two D.C. businessmen, Jeffrey E. Thompson and Cecile Barker.

Avant bowed out of the deal, however. He preferred to invest his money in more liquid assets, Peebles related. "He saw that the return on his investment was going to take longer than we had originally anticipated." On the flip side, Don's business relationship with Thompson and Barker soured. Don sued both men in D.C. Superior Court in June 1997 in order to forfeit their interests in the Royal Palm project. He accused his former partners of not making payments and bouncing checks. Barker countersued Peebles in Miami-Dade Circuit Court. In his lawsuit, he alleged Peebles was acting in his own interests rather than those of the partnership, and that Don had mixed partnership funds with accounts belonging to his other businesses. The complaint says Peebles was "engaged in self-dealing" by using joint monies to buy an interest in a racehorse, Sir Irish's Secret, and pay for a lavish $10,000 birthday party for himself. The ex-partners settled last year and Don says he came out on top. "It didn't cost my company a single penny," Don alleged recently. "In fact, they had to pay me."

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