Hoping to buy Crown Bank, they operate like a ‘mom and pop’ firm
OCEAN CITY — If they’re successful in purchasing the former Crown Bank building, twin brothers Raj and Yogi Khatiwala want to reinvest in the historic property to invigorate an important corner of downtown Ocean City like they have done with other properties in the resort.
Although the brothers are local and have amassed sizable holdings in Ocean City, they maintain a low profile and remain media shy. They were born in Atlantic City, grew up in Ventnor and went to Atlantic City High School before heading off to room together at Fordham University in New York.
Raj Khatiwala, in an interview with the Sentinel last week, said he spent a dozen years in finance in New York after college and now splits his time between that city and locally. Yogi Khatiwala also lives locally.
Through their company, Eclat Investments based in Atlantic City, they bought their first Ocean City property, The Forum hotel at 800 Atlantic Ave., in 2019, but quickly acquired more since then, including The Scarborough Inn at 720 Ocean Ave., The Pavilion at 801 Atlantic Ave., The Beach House at 819 Moorlyn Terrace, Stainton’s A Gallery of Shops at 810 Asbury Ave., Stainton’s Gallery by the Sea at 1216 Boardwalk, the Blue Water Inn Hotel at Eighth Street and Asbury Avenue and the Ocean Breeze Hotel at 724 Ocean Ave.
“Once we kind of saw Ocean City, we really loved the town, that it’s a dry town, a family environment,” he said. “We grew up with that in our household. A lot of the things that attracted us was the family environment and the wholesome nature. Ocean City is really nice.”
“As time progressed we acquired more assets. A lot of properties came to us directly because (the owners) knew how we operate. I feel like we’re honest and humble people. We really don’t even like to be in the news,” he added with a laugh. “This is awkward for us, more so than anything else, to do an interview.”
The Crown Bank building at 801 Asbury, with five parking lots behind it on Central Avenue, has been in bankruptcy proceedings. A judge set Tuesday, Dec. 20, for a hearing on the disposition of the property, but the hearing was postponed again until Dec. 27. According to documents filed in the case, a number of objections have been filed over the bankruptcy sale. It was not clear at the Sentinel’s deadline Tuesday when the judge in the case would rule.
The Khatiwala brothers have offered $6.675 million for the property and another on Route 50 in Estell Manor. Eustace Mita, a luxury hotel developer who stepped in to partner with Jay Gillian to save his Wonderland Pier amusement park, earlier put in an offer of $6.5 million.
A “mom and pop” company with substantial assets
The Eclat Investments website boasts $120 million in assets, but Khatiwala says the company he and his brother founded operates on a personal basis.
“People get the misconception we are a big company because we have hotels in Ocean City or we have more than one hotel, but we operate very small. We kind of have a family mom and pop company, with just a little more property than a traditional mom and pop,” he said. “Even all of our employees, our team, we’re grateful for everyone we have who works with us.
“It’s just me and my brother and we have four or five other people who are very close. We consider them all family even though they’re not really family.”
“The way we work is a little different. We operate with very clear expectations. We treat everybody like they’re our family. With any employee we have or anyone who is in business with us, we want to make sure that everyone has a good experience,” he said. “It also relates to our business, which is hospitality and hotels. Our employees are very important to us, just like our customers. We treat everybody the same. That’s very important.”
He explained that a lot of the properties the company has invested in came to them.
“For example, like the Bluewater and Ocean Breeze, sometimes unfortunate things happen and the owners come directly to us, whether as a favor or as a courtesy to help them out. That’s part of our nature,” Khatiwala said. “We’re very fair and loyal people. We don’t like to do anything to hurt anybody. I think people respect that and every owner that has sold us a property, if they come to town we’ll give them a free room. We always try to help everybody out. I think they appreciate that and hopefully it all gets reciprocated and they pay it forward and do the same thing.
“That’s part of Ocean City. It’s a very tight-knit community and we’re part of it. We’re going to be here for a while because even if we didn’t want to be, we are now,” he said, laughing.
No definite plans for the building
Elcat’s “real interest,” Khatiwala said, “is with commercial property that is older in nature.”
“What we see in the commercial side is that none of the properties (in Ocean City) really get renovated. Whether it’s an old hotel or old retail store or an office building like the Crown Bank, people forget these things can get renovated and fixed up as well. Some owners don’t care to reinvest in their properties,” he said. “Over time that’s what you get with the Crown, it kind of became obsolete.
“We like the Crown Bank building for a number of reasons. It’s hard to rebuild something like that. The property is magnificent. It has this old-school charm.
It’s this tower. The views from the office space are unobstructed and the best views in the city, I think. You can see the bay, you can see the ocean, you can see Atlantic City. It’s a really nice view,” Khatiwala said.
“I’m not sure what our business plan is for the interior of the space,” he said. “We haven’t had enough time to digest it. We definitely want to bring it back to life. The retail space, right now, we feel on Asbury it’s a very quiet corner. We want to bring a lot more life to it. We think that is probably the strongest corner on Asbury because it connects to Eighth Street, the corridor all the way to the beach.
“The Eighth Street side connects over to Seventh Street where you have a lot of retail. We think that corner can be something special. We can keep that energy going along Eighth Street and Asbury Avenue, which should help all the retail on Asbury Avenue,” he said.
Khatiwala noted the retail space is unique with its 30-foot ceiling.
“You’ll never see that built that way again. Our plan is to bring back some retail there and try to continue to keep the energy going in the building.”
Although many of Eclat Investments’ properties are hotels, the brothers may keep the upper floors of the building as office space, which is what it has historically been used for.
That can be easily renovated and put back into use, Khatiwala explained.
“I do feel like Ocean City has very little office. With the number of people moving into town, and just in general, high-quality office space might be useful,” he said.
Other investments in the resort, giving back
The brothers completed a major renovation and upgrade after purchasing The Scarborough Inn, which Khatiwala said is now the number one hotel in Cape May County.
They also do a lot of social awareness programs there. This past summer The Scarborough Inn was a “porch partner,” a host of A Mother’s Rest, which provides recuperative rest and therapeutic fellowship to moms and other female caregivers of loved ones with disabilities and/or chronic illness.
“Our goal with this (Crown Bank) building, just like everything else we’ve done in Ocean City, we tend to buy things that nobody wants, that are old and tired and it takes a lot of work to get them back up and running, but we have a special niche with that. I think we’ve been able to do a good job of bringing these properties back to life,” he said, citing The Forum.
“We completed a major renovation there last year. We’re doing some exterior renovations now and all the rooms are going to be brand new. We’re also being mindful, the same way the housing market is changing, people’s expectations for hotel rooms are changing as well. People don’t want to stay in older hotel rooms with an old shower and tub. Everybody wants something nicer,” he said.
“We have kind of implemented that in our hotels, whether it is smart TVs, tiled showers, nice linens and bedding and higher-end furnishings.”
Something similar can take place at the Crown Bank.
“The office space can be complementary to our hotels and at the same time we will explore what our options are. I don’t think we have anything set yet.
“All of this is happening very quickly. We have to move quickly and once we actually close on the purchase we can figure out what the best plan is,” Khatiwala said.
Bullish on Ocean City
“We are very bullish on Ocean City. We’ll keep looking for other opportunities that fit into our criteria. We are definitely proud to be invested in Ocean City,” Khatiwala said.
“Ocean City is a unique town,” he added, noting families return for generations because of its family nature, that it’s a dry town with an old-school feel to the boardwalk and its amusement rides.
“People love it. There’s not really anything else that’s like it. You can be comfortable with your family and your children and be safe.
“I ride my bike a lot and it’s just a great town. People are friendly. It’s very homey and cozy. That’s part of the reason we love it so much. It’s only going to get better.”
He also noted the Gillian administration’s proposed capital plan for the next five years has extensive infrastructure projects. “Those are going to be good for the future of Ocean City.”
“We definitely think there is a rising tide in Ocean City and we hope to help that,” he said. “Somehow if we were given this opportunity (with Crown Bank) we can do something good with it.”
By DAVID NAHAN/Sentinel staff
