Terra and Turnberry Land $75M for $590M Miami Beach Convention Center Hotel
The development team expects to close on financing in December and start construction next year
By Julia Echikson October 17, 2024 1:01 pm
reprints
After years of delays, the $590 million convention center hotel project in Miami Beach is close to getting off the ground, with developers Terra and Turnberry finalizing the financing, and construction anticipated to start next year.
The Miami-Dade County Commission on Wednesday unanimously approved a $75 million, taxpayer-funded grant for the 17-story hotel, which will be erected next door to the Miami Beach Convention Center, where high-profile events such as Art Basel are held.
The grant agreement will provide gap funding for the development team until it closes on financing in December, with construction expected to start in the next nine months, said Commissioner Eileen Higgins. Construction is slated to take 28 months.
Without the public funds, which will come from the Miami Beach Redevelopment Agency, the 800-room hotel project could be delayed by more than a decade, the commissioner said, adding, “We don’t always get to find the perfect solution.”
The funding marks perhaps the most significant advancement since 2018, when Miami Beach voters approved the Arquitectonica-designed hotel development, located on city-owned land at the intersection of 17th Street and Convention Center Drive.
The COVID-19 pandemic delayed the project by about two years, said Terra CEO David Martin, a co-developer on the project alongside Jackie Soffer, chair and CEO of Turnberry.
Since the approval, the estimated construction cost has grown by more than $200 million, bringing the project’s total budget to nearly $590 million, according to filings made to Miami-Dade County. The development team has already spent $20 million, per Martin.
“The project is now shovel ready, though construction costs rose considerably during the global pandemic and the capital markets remain constrained today,” according to a statement from Terra. “Financial support from the Miami Beach Redevelopment Agency, coupled with more than $500 million in private financing contributed or raised by our development team, will ensure the expeditious delivery of this important project.”
Turnberry anticipates the construction loan to be approximately $400 million, said a representative for the Aventura-based developer. A spokesperson for Terra declined to provide additional details about the project’s private financing.
The convention center hotel will allow Miami Beach to attract bigger conferences, according to city officials.
Update: The story was updated to add comments from Terra and Turnberry representatives.
Julia Echikson can be reached at jechikson@commercialobserver.com.
