Peebles Gets Okay For Fort Lauderdale Hotel

BROWARD COUNTY, FL— Even long after all the presidential ballots were officially tallied, Broward County was embroiled in governmental controversy, only this time it was about a much-debated convention center hotel project proposed by a well-known African American developer. The storm has finally settled, and after years of arguments and a hard-fought battle, R. Donahue Peebles, president/CEO, Peebles Atlantic Development Corp., is set to become the first African American to develop and own a convention center hotel in America. The new property is expected to employ many in the area’s minority community. Following approximately three years of project delays and negotiations, the Broward County Commission voted on March 29 in favor of Peebles proposed development project, which includes a joint-venture partnership and management agreement between Peebles and Wyndham International. “We’re going to build a first class Wyndham hotel at the [Broward County] convention center,” said Peebles. The project is set to break ground this fall and open in October 2003. The $81 million hotel will receive $52.6 million in debt financing from California-based Freemont Investment and Loan, a $15 million equity investment from Wyndham, a $2.3 million investment from Peebles’ corporation and $11 million in public subsidies. So, why did the project’s approval take so long? According to Peebles, no one could agree on who would own the hotel. Peebles originally submitted a proposal to develop and own the hotel in partnership with a hotel company that would manage it. However, after much debate, the County Commission decided to investigate the benefits of developing and owning the hotel itself, according to Peebles. He then began fighting for a long-term management contract, between 15 to 30 years, which would ensure that the hotel would offer minority employment opportunities. However, when he submitted a letter to the county in early March 2001 requesting a long-term management contract— that also stated that if he didn’t get it, he would demand his $2 million investment back— support for the project from the African-American community seemed to waver. Though many newspapers, including the Miami Herald, reported that the “ultimatum” caused a negative reaction from leaders in the African-American community, Peebles said that these reports “were overstated in the media.” “Support never wavered,” he continued. “The African-American community was disappointed and concerned. They wanted the hotel to go to a minority developer.” In addition, he noted that reports that actor Will Smith and his brother Harry, a developer and partner in Smith’s Treyball Development, were vying for the project were also “overplayed.” “They have never built a large hotel,” explained Peebles. “He had no interest in competing with me.” Peebles said that there was a time where he “almost pulled out” of the project. He explained that his corporation is “equity-oriented,” and that in order to make a profit, it needed the development process to move more quickly. He noted that Broward County has no chief executives, and that the nine members of the commission make all decisions. “There were nine people that saw things differently, and no one with the authority to move things forward,” said Peebles. “But at the end of the day we got pretty much what we asked for.” After a consultant estimated the cost of project at $111 million, Peebles said the commission decided that “the taxpayers’ money would be better spent with an $11 million investment into our project.” So after nine years of searching, and two previously failed relationships with other developers, Broward County will finally get its convention center hotel. As part of the joint venture, Peebles’ corporation will own 60% of the hotel and Wyndham will own the other 40%. “Convention centers lose money by not having a convention hotel,” said Andy Ingraham, president, Horizons Marketing Group and the Internatio