Steve Ross’ Related Ross secured approval — again — for its convention center hotel deal with Palm Beach County, following a lawsuit filed by nearby residents attempting to block the deal.
This is the second time the county has heard and voted on the hotel. Commissioners approved the deal Sept. 29, but that contract was stalled by the residents’ lawsuit, which alleged the public wasn’t given fair notice or time to review the proposal before the vote.
The county is set to buy the land, currently a parking lot, for the planned 400-room Hilton Curio from Related Ross for $26 million. The developer plans to raise the 18-story hotel at 900 South Rosemary Avenue with its own debt and equity, under a lease with the county.Â
The initial lease lasts 33 years, with the option to extend for a total of 97 years. Related Ross would pay $1.1 million a year in rent, increasing by 3 percent annually, with an extra participation rent above a $77 million threshold. The sale-leaseback structure allows the developer and the county to bypass property taxes.
The residents’ Oct. 14 lawsuit asking for a pause on the development will still advance, their legal team said. It came alongside a separate document in court filed Sept. 30 asking for a review of the city’s authorization of the hotel.
Residents of the nearby neighborhoods raised concerns about construction debris, noise and traffic. Some said the deal was done outside the public eye with little regard for residents.
Commissioners didn’t genuinely reconsider the issue upon the second vote, residents’ association attorney William A. Brewer III said in a statement.Â
“It appeared to be a badly choreographed effort to whitewash a backroom deal,” he said. “At a bare minimum, this rehearsal completely ignored the spirit of the law.”
Proponents say the hotel will attract larger conventions and bring economic stimulation to the county. The hotel would be worth an estimated $349 million upon completion, by the county’s estimate, and would collect $1.1 billion in base and parking rent in an extended lease.
Since voters approved Amendment 3 to raise the state’s homestead exemption, local governments are in need of the revenue lost by the phased-out property taxes, county Chamber of Commerce President Michael Zeff said.
Commissioners voted 6-1 to advance the project, with the only holdout being District 2 Commissioner Gregg Weiss.
Related Ross developed and owns the Hilton West Palm Beach convention center hotel, completed in 2016. It won the bid to develop a second convention center hotel two years ago.
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