Developer of Embassy Suites project asks for fifth extension

By Melanie LeCroy / melanie@gulfcoastmedia.com
Posted 10/6/21

Developers of the Gulf Shores Embassy Suites project, D.D. Partners, LLC. made a request to the city for a fifth extension to the project and added a substantial financial payment to the city as a …

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Developer of Embassy Suites project asks for fifth extension

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Developers of the Gulf Shores Embassy Suites project, D.D. Partners, LLC. made a request to the city for a fifth extension to the project and added a substantial financial payment to the city as a good faith gesture of their commitment.

In 2015 the city issued a request for proposals for a public-private partnership to construct a mixed-use project on 1.93 acres owned by the city of Gulf Shores within the Gulf Beach District. The project selection committee recommended the city council select the proposal from Ron Durham of D.D. Partners, LLC. The proposed $85 million mixed-use development will be anchored by an Embassy Suites hotel with 229 rooms and 11,800 square feet of conference space.

The project was originally set to begin construction July 1, 2019, with a projected opening of late fall 2021. In June 2019, the developers requested and received an extension pushing the start date to January 2020. The most recent amendment was approved in September 2020 because of an effective freeze in financial markets for financing full-service hotel/hospitality projects due to the uncertainty of the COVID-19 pandemic. The extension granted a start date of September 2021.

Gulf Shores Economic Development Coordinator Blake Phelps told the city council that he and his department have stayed in frequent communication with Durham and his team.

“The say report they have seen significant improvement in the financial markets over the last few months. They indicate they are receiving a lot of interest in this project and financing this project despite what our community has gone through in the last year with the COVID-19 pandemic and Hurricane Sally. The markets are starting to see just how well our economy has fared through both of those challenges and has exceeded this summer as well,” Phelps said.

The fifth extension request pushes the project start date to June 30, 2022, with a completion date of Sept. 30, 2024. The extension request also came with a financial incentive for the city of Gulf Shores. D.D. Partners, LLC. offered a total of $400,000 as a good faith gesture of their commitment and confidence in the project. The city will receive $200,000 within 15 days of the extension approval. An additional $200,000 payment will be paid no later than Jan. 15, 2022. D.D. Partners has the option to terminate their agreement by Dec. 31, 2021. If the agreement is terminated the initial $200,000 will be refunded.

Rob Durham with D.D. Partners, LLC was present during the Sept. 20 City Council work session and was given an opportunity to speak with the City Council. He indicated that while some features of the original project have changed the overall requirements have been met. The original plan called for 11,800 square feet of conference space and 229 rooms but Durham said those have increased to around 14,000 square feet of conference space and 254 rooms.

“We are very enthused and we are trading term sheets now with three specific investor groups and we think in the next few weeks we will exclusively be negotiating with one capital source for this so we are very enthused,” Durham said.

During the City Council’s regular council meeting Sept. 27, the council suspended rules so they could consider the ordinance and voted unanimously in favor to adopt the ordinance.

During the regular session, the council:

  • Approved a public assembly permit for the Gulf Shores High School Community Homecoming Tailgate at Gulf Place Town Green Oct. 14.
  • Passed a resolution accepting the bid of Coastal Industry Supply of $2.85 per pound for perennial rye grass for various sports fields and common areas throughout the city.
  • Passed a resolution to postpone business license revocation hearing for Gulf Shores Landfill, LLC indefinitely. The city is working with legal and Alabama Department of Environmental Management regulatory entities to resolve issues at the landfill.
  • Passed a resolution authorizing the mayor and city clerk to execute a renewal of the rental lease agreement for an existing medical office building located at 204 West 19th Avenue, Gulf Shores between the city of Gulf Shores and J and J Enterprises, LLC.
  • Passed a resolution approving and ratifying the Airport Authority’s land lease agreement with Legal Air Properties, LLC for 14,345 square feet of land in the southwest corporate hangar area complex for the construction of an aircraft storage hangar facility.
  • Passed a resolution establishing the place, date and times for the Gulf Shores Municipal Court to hold open session for the purpose of hearing matters within the jurisdiction from Jan. 2, 2022, through Dec. 3, 2022.