October 6, 2022


Just Do Travel

How successful is Protogroup’s new hotel in Daytona Beach?

7 min read

DAYTONA BEACH — It’s a rainy afternoon, but that didn’t keep Greg Green from checking out the pool deck at the Daytona Grande, the 27-story 455-room hotel that opened a little over two months ago as part of the controversy-ridden $192 million Protogroup twin-tower hotel-condominium project.

“It’s a pretty nice pool,” said Green, 50, as he watched his wife lounge amid the raindrops in the hot tub beneath him on the multi-tiered deck.

The Daytona Grande welcomed its first guests on June 4, a soft opening that was surprisingly accompanied by no fanfare to mark a long-awaited milestone in the biggest, most expensive development in Daytona Beach history.

Low-key opening: Long delayed Protogroup hotel opens without fanfare. Here’s a look inside

It’s unclear how many guests have booked rooms in the weeks since.

A heating and air-conditioning technician who owns his own business in Birmingham, Ala., Green and his wife were spending a few days at the Daytona Grande before heading south to Fort Lauderdale.

“It’s a good view of the city,” he said. “The room is nice and clean.”

Because his wife made the reservation, Green said he wasn’t sure how much the couple paid. On the hotel’s website, daytonagrande.com, nightly room rates for Friday and Saturday nights in August ranged from $319-$377. Weeknights were available for $183 nightly.

Although the couple was pleased with their room on the 20th floor, Green also said it was obvious to him that the hotel wasn’t finished yet.

“The elevator is screwed up,” Green said. “There are five elevators, but only two of them work. We had a hard time getting it to stop at our floor.”

Inside, roughly a dozen people nursed drinks at the bar or strolled the main floor of the three-level lobby, with its light fixtures shaped like coral formations and oversized paintings of underwater scenes.

“It’s not really busy,” Green said.

In conversation with hotel visitors, an employee said that the hotel was booked to capacity, before adding that only about half of its 455 rooms were available for reservations.

No such updates on the hotel’s opening summer have been available from its owner.

Alexey Lysich, president of Protogroup Inc., the family-run Palm Coast-based company whose Russian owners are developing the project, has consistently refused to answer questions about its progress.

This past week, a Protogroup employee shut the door on a News-Journal reporter looking for Lysich at the company’s office at the base of the hotel at North Atlantic Avenue and Oakridge Boulevard.

“No, thank you,” she said, cutting off the reporter’s question.

Nor did Lysich respond to voicemail or text messages seeking an update about occupancy, staffing and other topics related to the newly opened hotel.

Plenty of elbow room at the Daytona Grande

Although an indication of hotel occupancy in Volusia County is reflected collectively in monthly bed-tax collections that fund tourism promotion via the county’s three tourism advertising authorities, bed-tax collections for individual properties by law cannot be disclosed.

Roughly 50 hotels report their monthly occupancy figures confidentially to Mid-Florida Marketing & Research through a partnership with the Lodging & Hospitality Association of Volusia County.  From that data, Mid-Florida formulates a countywide average that is circulated to association members as a business indicator.

Hotel managers otherwise tend to be reluctant to share specific occupancy figures for their properties due to competitive concerns, although they often offer more general observations to reflect trends.

Evelyn Fine, president of Mid-Florida Marketing & Research, said she wants to include Daytona Grande in the raw data for her monthly research, but hasn’t been able to enlist the hotel’s participation.

“We try each month for them, but so far no response,” she said.

In a sign that such participation might be forthcoming, Daytona Grande this past week joined the hotel association, said Bob Davis, the organization’s president and CEO.

“We’re proud to have them,” Davis said. “We’re proud to have a fantastic new hotel join the association and to have them in Daytona Beach.”

 So how busy is the hotel?

Over three days last week, a tally of cars parked in the property’s six-story parking garage averaged 52 vehicles daily in its 517 spaces. On most days, only the ground-floor level was in use.

Although the hotel uses the garage for self-parking and valet service — at overnight rates of $20 and $30 plus tax, respectively — it also is used by non-hotel guests headed to the beach or other nearby businesses.

Inside the hotel, meanwhile, there also was ample elbow room.

On a recent afternoon, about a dozen diners occupied two of more than a dozen tables in the restaurant around the corner from the front desk.  At a counter that opened to the kitchen, diners ordered self-service style from a lone, crinkled paper “all-day dining” menu.

Choices included chipotle wings ($12); chicken quesadilla ($10); wood-fired pepperoni pizza ($15); chicken Caesar salad ($15); a “Beachside Burger” ($17); ciabatta turkey club ($16); or chicken tenders and fries ($14).

The scene differs from images and promotion of dining options depicted on the hotel’s website, which beckons guests to indulge in “inspired American cuisine, with a wine collection to match” and “enjoy market-fresh fish and seafood, or choose a classic selection of prime meats in a setting like none other.”

Nevertheless, Green, the Alabama visitor, said that he and his wife had tried the pizza and the quesadilla and found them “both pretty good,” he said. “We’d come back.”

Project beset by delays, controversies

The opening of the hotel is a significant milestone for a project that has endured a long series of controversies and delays since Protogroup bought the property at the intersection of Oakridge Boulevard and North Atlantic Avenue in 2012.

In August 2020, Protogroup parted ways with Port St. Lucie-based Gryffin Construction Corp., the second general contractor on the high-profile project.

Gryffin took over construction of the Protogroup’s twin tower project in October 2018, following the abrupt departure of the original contractor, Mississippi-based W.G. Yates & Sons Construction Company.

In December 2020, the city of Daytona Beach granted yet another extension for completion of the project, just ahead of a previous Jan. 29, 2021 deadline for completion of the project’s South Tower. The city extended that deadline to March 18, 2022.

An extension also was granted by the city on the deadline for completion of the North Tower, which now faces a deadline of March 16, 2024.

The back story:

• FROM 2018: Daytona Beach hotel developer’s activities catching IRS attention, lawsuit reveals

Along the way, the project also stirred up the ire of local residents with a proposed valet lane that would have cut west across oncoming traffic at the Oakridge-Atlantic Avenue intersection.

In October 2020, the developer started unauthorized construction on the controversial valet parking lane at the east end of Oakridge, work that was started without notice on an expired Florida Department of Transportation permit. Ultimately, the lane was removed at the developer’s expense.

At different points, the project also ran into problems when it closed a required beach access pedestrian walkway on the northern boundary of the construction site. Most recently, the walkway was closed for a time in March just as Bike Week visitors started to arrive for the annual 10-day event.

In June, a code enforcement complaint was filed with the City of Daytona Beach about rows of rusted rebar columns on the construction site of the yet-to-be-built North Tower portion of the Protogroup project.

More: Code enforcement complaint filed over rusted rebar on Protogroup North Tower site

On that site, dozens of exposed rebar jut from pilings that have already been poured. The rebar is tinted copper, the result of rusting in the sun and salt air for nearly three years since foundation work began in December 2018 on that portion of the project.

The north tower, when it is completed, would be the tallest building in Daytona Beach. In 2017, The News-Journal reported that the foundation consisted of 100-foot deep holes drilled into the ground and filled with concrete and rebar.

The complaint was filed by Paulita Kundid, owner of the tiny Sea Dunes hotel at the base of the Daytona Grande hotel. Less than 48 hours after the complaint was filed, in the early morning hours of June 24, the 13-story Champlain Towers South condominium in Surfside in Miami-Dade County suddenly collapsed.

That tragedy heightened Kundid’s urgency about the issue.

By June 29, the site had been listed as “in compliance” in regard to the appearance complaint following a visit by city code inspector Clearvens Jean-Baptiste, according to the city’s code enforcement website.

Controversies involving the developer also have extended beyond the construction site.

A federal lawsuit filed in 2018 against Protogroup includes an Internal Revenue Service report that questioned Lysich’s claim that he paid a Bahamas shell company $710,000 for an estimated $71 million in fruits and vegetables in 2014. The IRS stated that a deduction Lysich declared for payments to the shell company “should be disallowed in full.”

Excavation work for the twin-towers project began in March 2017, with an initial projected completion date of summer 2019 for the 27-story South Tower, now the Daytona Grande. The taller 31-story North Tower originally was slated for completion in 2020.