July 25, 2018 | The Real Deal
800-room hotel would cost up to $362M and be financed with loans and partner equity
By Francisco Alvarado
For the second time in two years, Miami Beach voters will again decide if the city gets a convention center hotel.
On Wednesday, the city commission voted unanimously to place a referendum on the Nov. 4 ballot asking residents whether the city should enter into a 99-year lease with a star-studded development team, headlined by Jackie Soffer of Turnberry Associates and David Martin of Terra Group.
The group submitted the lone proposal in Miami Beach’s latest attempt to build a hotel that would attract major conferences and conventions.
Miami Beach Connect — the entity set up by Soffer and Martin — wants to build an 185-foot hotel with 800 rooms on 2.6 acres adjacent to the Miami Beach Convention Center and behind the Fillmore at the Jackie Gleason Theater. The development group would spend between $348 million and $362 million on construction of the hotel, using loans to finance 65 percent of the cost. The rest would be financed through partner equity.
Miami Beach Connect’s hotel would pay the city roughly $16.6 million in rent or a percentage of the revenues, whichever is greater, according to the resolution approved by the city commission. When the Soffer-Martin team unveiled its proposal, representatives said the city could earn up to $10.2 million a year from the hotel based on taxes the project would have to pay.
Whether the city’s return and the sleeker, shorter design submitted by Miami Beach Connect will win over voters who rejected a 2016 proposal by Atlanta-based Portman Holdings for a 288-foot-tall hotel could be a tough sell. Residents still have concerns about the traffic a convention center hotel would bring to the city’s clogged streets.
“The 500-pound gorilla was always the traffic issue,” said City Manager Jimmy Morales. “But this is the only hotel that will bring more business for other hotels and only hotel that can attract high-end conventions and trade shows.”
Alex Heckler, a lobbyist for the developers, said project architect Arquitectonica designed the hotel with resolving the traffic concerns as one of the top priorities. The driveway is designed to hold a significant number of vehicles in order to avoid traffic backing up onto Convention Center Drive, he said.
“This is different than Portman deal,” Heckler added. “This is 100 feet lower. It is the same size as clock tower on Lincoln Road. They didn’t try to maximize the site.”
The Miami Beach Connect team also includes Craig Robins’ Dacra, which is conducting urban planning; Meyer Davis Studio, which is in charge of programming the restaurant; and Coastal Tishman, the general contractor. The hotel would connect to the newly renovated convention center via a skybridge.