99-year Miami Riverbridge hotel lease faces city vote

Lease negotiations for the Hyatt hotel in downtown Miami are expected to be final this week, clearing the way for construction of new high-end accommodations and a reimagined riverfront.

Today (5/11), the Miami City Commission is to vote on whether to amend the ground lease for the existing Hyatt Regency Hotel at 400 SE Second Ave., allowing for the proposed Miami Riverbridge to rise at the property. The mixed-use project would provide over $1 billion in increased revenue for the city and include a modernized hotel with event and retail space, apartments and an improved public walkway along the Miami River.

The reconceptualized site would feature an upscale 615-key flagship Hyatt hotel, 188,000 square feet of Class A convention and meeting space, 1,500 market-rate apartments, parking, 50,000 square feet of public outdoor space and an expanded 480-foot riverwalk. The project also promises better access in and out of the city’s urban core to ease traffic congestion and improve the pedestrian experience.

The lease amendment before the city commission stipulates an annual rent schedule of $1 million for year one, $1.25 million for year two, $1.5 million for year three, $1.75 million for year four and $2 million for year five. After the construction rent period closes, the yearly base rent paid to the city must be no less than $2.5 million or 2.5% of gross revenues.

Miami initially entered a long-term lease for the city-owned waterfront property in 1979. For years, officials have considered plans to revitalize the 4-acre site, which includes the adjacent and aging James L. Knight Convention Center.

In 2021, the city pursued the redesign and renovation of the facilities with HRM Owner LLC, a partnership between Hyatt Hotels Corp. and Gencom, a Miami-based real estate development firm. Last November, 64% of Miami voters approved a ballot measure to extend the existing Hyatt lease with HRM Owner LLC for a 99-year term.

“The proposed development of the Hyatt Regency Miami site… will offer a walkable, family-friendly riverfront destination with easy access to a new riverwalk, an innovative range of dining options, regular outdoor events and entertainment and vital new public space,” said the partnership.

The privately funded project is expected to contribute more than $1.5 billion to the city through taxes, fees and rent, which the developers say can be invested in additional infrastructure improvements, resiliency measures and enhancements throughout Miami.

The lease additionally requires the developer to make a $25 million contribution toward affordable housing in the city.

According to HRM Owner LLC, the project will create about 4,500 construction jobs, and the number of permanent jobs post-construction will more than double from 350 currently to nearly 900.

Phil Keb, former executive vice president of Gencom, previously said the financing would be arranged by the end of 2023 or the first quarter of 2024.

After funding is secured, the riverfront revival is expected to rise within five years. The first two towers are due by the end of 2028, and the third by the end of 2029.