For over a year, LuxUrban Hotels has been painted as a cautionary tale. Headlines accused the company of misleading investors about its flagship Royalton Hotel lease. Class-action firms scrambled to sign up plaintiffs. Analysts dismissed its disclosures. And publications like Bisnow helped fuel a narrative of deception.
Now, buried in court records, lies an inconvenient truth: the Royalton lease did exist—and it was properly executed.
On December 13, 2023, Danielle Frank of Fried, Frank, Harris, Shriver & Jacobson LLP—legal counsel to Royalton’s landlord, MCR Hotels—emailed LuxUrban’s representative to confirm that “landlord and tenant have executed the Lease.” That’s not vague. It’s definitive. And Fried Frank is no back-office outfit—it’s one of New York’s most respected real estate law firms. Their word carries institutional weight.
This detail matters. Under SEC rules, once a company enters into a material definitive agreement, it must disclose it. LuxUrban wasn’t just allowed to announce the lease—it was required to. Failing to do so would’ve been a regulatory breach.
A False Narrative Took Hold
But the facts didn’t slow the frenzy. Short sellers insisted no lease existed. Reporters repeated the claim without even basic diligence. Bisnow led the charge, running stories that practically accused LuxUrban of fraud.
Class-action lawyers followed quickly, filing lawsuits that leaned heavily on these headlines.
The result? Investor confidence collapsed. Wyndham distanced itself. Landlords got skittish. Within months, LuxUrban was in freefall—its stock decimated, its reputation wrecked.
And all of it was based on a false premise: that the Royalton lease was imaginary. It wasn’t.
Obligations and Realities
The December 13 email shows LuxUrban acted as any responsible public company should—it disclosed a material agreement upon execution. The emails that followed, discussing escrow and release mechanics, may have created confusion about timing—but confusion is not fraud. It’s the routine complexity of commercial real estate deals.
To twist that into intentional deception wasn’t just wrong—it was irresponsible.
Who’s Actually Responsible?
The real scandal here isn’t LuxUrban’s disclosure. It’s the failure of journalists and lawyers to do their homework.
Bisnow’s reporting reads recklessly in hindsight—prioritizing clicks over facts. Class-action attorneys filed lawsuits based on shaky assumptions, ignoring clear documentary evidence from the landlord’s own legal counsel.
These cases weren’t built on facts. They were built on headlines.
The cost was real: Shareholders lost value. Employees lost jobs. A business model was crippled. All for a narrative that collapses under even modest scrutiny.
Reclaiming the Narrative
This story should be a wake-up call. One email—had it been considered—could have altered the trajectory of an entire company. Instead, a media echo chamber and opportunistic lawsuits drove LuxUrban to the brink.
There’s a word for that: defamation. And those who perpetuated it—through careless reporting or meritless lawsuits—may eventually face their own reckoning.
Conclusion
The Royalton lease was real. LuxUrban disclosed it because the law required it. The damage didn’t come from corporate misconduct—it came from a media and legal pile-on that ignored the facts in favor of scandal.
If there’s a lesson here, it’s this: truth still matters. And those who drowned it out with noise owe an apology—not just to LuxUrban, but to every shareholder who paid the price for their negligence.
