Terra and Turnberry are getting a $75 million taxpayer infusion for the joint venture’s convention center hotel project in Miami Beach.
Despite securing more than $500 million in private financing for the Grand Hyatt-branded development at the intersection of 17th Street and Convention Center Drive, Terra and Turnberry need to plug a funding gap in construction costs, officials for the joint venture and the city of Miami Beach, told Miami-Dade County commissioners on Wednesday.
The 13 elected officials unanimously voted to approve a $75 million grant through the Miami Beach Redevelopment Agency for the planned 17-story, 800-key hotel which would connect to the Miami Beach Convention Center.
Rickelle Williams, a Miami Beach assistant city manager, told county commissioners that the convention center hotel project’s construction cost increased dramatically in recent years due to the pandemic, higher wages for laborers and construction materials becoming more expensive.
The project’s construction cost was previously pegged at roughly $400 million, but has since ballooned by another $200 million, according to a county resolution.
Between 2020 and 2022, the project was at a standstill due to Covid, said David Martin, CEO of Coconut Grove-based Terra. “We have invested $20 million preparing the site,” Martin told county commissioners. “The hotel is going to be paying property taxes in an amount that is very equivalent to this grant.”
Miami-Dade County commissioner Eileen Higgins, whose district includes Miami Beach, said that she reluctantly agreed to sponsor the grant allocation so the project can break ground soon. County and city officials have touted a new convention center hotel as a potential catalyst for business tourism.
“I don’t like that we have to invest $75 million of the people’s money into this,” Higgins said. “When we look at the economic impact to our county and the tourism revenue it will generate, it is long term beneficial to bring this item.”
Following the vote, Terra said in a statement that the joint venture has obtained all necessary building permits, and the project is shovel ready. “Our team is asking the [Miami Beach Redevelopment Agency] to allocate $75 million to accelerate construction,” the statement said. The hotel is expected to generate this amount back to the [redevelopment agency], city and county many times over.”
In 2018, Miami Beach voters approved the project on land owned by the city adjacent to the convention center, which underwent a $600 million renovation. Terra and Turnberry, led by CEO Jackie Soffer, tapped Coconut Grove-based Arquitectonica to design the hotel, which will feature 12 floors of guest rooms, two floors of meeting spaces and ballrooms, a pool deck on the fifth floor and ground-floor retail space.
