A vacant surface parking lot beside the Palm Beach County Convention Center could become a 400-room hotel under a deal that would have the county buy the land, then rent it back to Related Ross for decades. The proposed arrangement puts a major downtown West Palm Beach development back in motion while raising fresh questions about taxes, parking and how much control taxpayers should retain.
Under the preliminary plan, Palm Beach County would purchase the roughly 1.8-acre site for $26 million and lease it back to Related Ross for an initial 33-year term, with extensions that could stretch the arrangement to 99 years. The developer would use the site for a Hilton Curio hotel costing about $300 million, The Real Deal reported.
Related Ross would fund the hotel's construction rather than seek public construction money, according to a February Palm Beach County agenda item describing the privately initiated proposal. That document said the project was intended to strengthen the convention center's ability to attract larger meetings and conferences, with most of the new rooms expected to serve convention-center demand.
The Deal Could Bring The County $1 Billion
Preliminary terms outlined by Stet News call for Related Ross to make an upfront payment, pay the county at least $1.8 million annually once the hotel opens, and increase those payments by 3% each year. Over 99 years, the guaranteed payments could exceed $1 billion, with additional revenue tied to the hotel's performance and parking arrangements.
The tax treatment is the more politically combustible part of the proposal. Because the county would own the land beneath the hotel, the project could avoid property taxes that might otherwise flow to the city, school district and other taxing bodies, while Related Ross would receive the benefit of a public-private ownership structure.
Neighbors Still Have Concerns About The Hotel
The proposal has already cleared a major city review, with West Palm Beach's Planning Board approving the 23-story project in June, according to WLRN. The planned hotel includes additional meeting space, a large pool deck and a rooftop restaurant, but residents near Grandview Heights and CityPlace Tower South have raised concerns about traffic, noise, pedestrian safety and the building's proximity to nearby homes.
Related Ross has offered changes including raised crosswalks, traffic-calming measures, wider sidewalks and limits on amplified outdoor music after 10 p.m., WLRN reported. Those concessions may smooth the path for the project, but they do not eliminate the broader debate over whether West Palm Beach is growing faster than its neighborhoods can comfortably absorb.
County Approval Is Still The Big Hurdle
The latest proposal follows Related Ross's selection in a county request for proposals to develop a second convention-center hotel, followed by negotiations that stalled as construction costs climbed. The company is now seeking an amendment to the existing hotel development agreement, and would also pay millions in upfront fees while leasing spaces in the county-owned convention center garage, The Real Deal reported.
The Palm Beach County Commission must approve the county's land-sale and leaseback arrangement before the project can proceed. If commissioners sign off, the current parking lot would give way to a second convention hotel beside the existing 400-room Hilton West Palm Beach, effectively doubling the number of rooms directly serving the convention center.
