After a nod from Miami Beach City Manager Jimmy Morales, the city commission will vote Wednesday on Portman Holdings’ proposed convention center hotel, The Real Deal has learned.
Morales has added the convention center hotel item to the Miami Beach City Commission’s agenda: “a resolution accepting the recommendation of the city manager… for the development of a Convention Headquarter Hotel adjacent to the Miami Beach Convention Center.”
The city manager’s approval was required by May 20 for the commission to weigh in. If approved by the commission, the administration then would be authorized to negotiate a development and ground lease agreement with Portman. The final agreement would be subject to approval by the mayor and city commission.
Jack Portman, vice chairman of Portman Holdings, proposed a curved blue building adorned with gold abstract trimmings designed by his father, and the company’s founder, architect John Portman.
Portman Holdings, an Atlanta-based, family run, real estate development, investment and management company, was the only contender left bidding for the right to develop a convention center hotel.
The proposed hotel will have 701 guest rooms, 99 suites, 95,210 square feet of meeting space, 320 parking spaces, a fitness center, spa, business center, and five food and beverage establishments. The plan calls for increased tree canopy and ground floor food and beverage functions lining 17th Street to activate and energize the street level.
It will also have multiple pools in the midst of two roof-top-style gardens created by the urban design and architecture firm West 8. The gardens would be located on platforms 80 feet off the ground on both sides of the building — one facing east, the other west.
John Portman IV, chief operating officer for Portman Holdings, said the project will cost about $405 million to build. Portman Holdings will kick in $17 million toward its construction costs, a financial institution to be named later will loan $243 million, $162 million would be raised from private equity funds, and $145 million will come from an institutional investor. One institutional investor that has expressed interest is China Orient Summit Capital, a quasi-Chinese state owned financial company that has partnered with Portman Holdings on projects in the past.
In exchange for a 99-year lease, the developers promise to pay the city 4 percent of its gross revenues. Portman IV, estimated that the city will receive $2.5 billion in the course of the 99-year lease.
Jack Portman said his company has a track record of building 11 convention hotels in the United States with more than 500 rooms, plus nine additional hotels around the world with 500-plus rooms.
An agreement with the city will need to be hammered out by July in order for the item to be placed on the upcoming November 3rd ballot. Under Miami Beach law, any proposal to lease city-owned land must be approved by Miami Beach voters.
Also on Wednesday, the city commission is scheduled to vote on executing a construction manager at risk agreement for Clark Construction Group’s renovation and expansion of the convention center. In addition, the commission will discuss the creation of the Lincoln Road Business Improvement District, and will take a final vote on cutting off the sale of alcoholic beverages at sidewalk cafes at 2 a.m., and will take an initial vote on standards for umbrellas and awnings at sidewalk cafes on Ocean Drive.