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SAN BENITO — Developers behind a proposed a $711 million, 115-acre project to build a hotel and convention center as part of a retail and entertainment mecca are presenting city commissioners with project plan details nearly two years after they planned to launch construction.
After granting Western Spherical Developers a 30-day extension to present the information, officials requested developer David Miles clarify his project plan, City Commissioner Pete Galvan said.
“We were requesting clarity on the final project plan. These things should have been turned in during the initial phase,” he said, referring to the project’s planning period before an October 2021 groundbreaking was expected to trigger the construction phase.
During an April 25 meeting of the city’s Tax Increment Reinvestment Zone board, commissioners requested Miles, with Friendswood-based Western Spherical Developers, provide the information, he said.
PROJECT CLIMBS TO $711 MILLION
During last month’s TIRZ board meeting, Miles presented a preliminary project plan and finance plan aimed at developing what he described as a “world-class project.”
In an April 25 letter to TIRZ board members, he states the information was aimed at “enhancement and improvement” of his project plan.
In his letter, Miles states he’s planning to build-out the first phase from $178 million to $288 million, increasing the proposed hotel’s number of rooms while adding an indoor water park along with a “technology and aeronautics complex.”
In the letter, Miles states he plans to increase the 26-acre second phase’s build-out from $130 million to $170 million while adding more retail suites and restaurants along with a winery.
As part of the project’s third phase made up of two 25-acre parcels, he’s planning to increase build-out from $180 million to $253 million, aiming to support a proposed “workforce housing and business center” along with a “community sports and wellness technology center.”
Meanwhile, Miles states he’s increasing his finance plan from $34.9 million to $56.5 million.
SUPPLY CHAIN BOOSTS COSTS
In his letter, Miles cites the coronavirus pandemic’s supply chain crisis’ escalations of materials’ costs as a factor behind the project’s delays.
“Challenges with material costs and supply chain issues have been a worldwide concern,” he states. “Additionally, with interest rate increases and inflation, the Epicenter team has had to reevaluate the development timeline and incentive value capture to maximize approved and available state and city incentive programs.”
REVISION TO SPEED UP TIMETABLE
The revised plans will help speed up the project, Linda Merritt, RGV Epicenter’s spokeswoman, stated.
“The proposed amendments will escalate the construction schedule,” she stated. “In turn, this will result in a positive impact to the community with job creation and tenancy opportunities also on an escalated schedule. An important element to this will be working closely with the city of San Benito and the San Benito Economic Development Corporation-UTRGV Business Center regarding growth of San Benito’s business community, workforce and training opportunities, vendor opportunities and ultimately tenancy opportunities. A core goal with RGV Epicenter is to move forward in lock-step as a community partner with the city of San Benito and SBEDC cross-marketing-supporting opportunities for growth in downtown San Benito and local businesses resulting in positive impacts on San Benito’s quality of life and economic growth.”
QUESTIONING PROJECT
Now, the city’s new commission is set to review the developer’s information during a June 6 meeting, Galvan said.
“We need to sit with the entire commission and see if we want to continue entertaining this project,” he said.
Like Galvan, Mayor Rick Guerra continues to question the project.
“This commission is seriously looking at what we have and what we have to offer,” he said. “He’s missed the starting date — construction. They have missed deadlines. He’s been given extensions. Everything is on hold. If you’re seriously doing something, I need to see infrastructure. We’re still waiting for him. He needs to produce. San Benito is open for business, but we’re not going to be waiting forever.”
Meanwhile, newly elected Commissioner Deborah Morales, a member of the city’s Economic Development Corporation board, said she’s reviewing project documents before commenting.
“I’m going in with my eyes open,” she said during an interview. “I’m looking at getting all the reports and doing my homework. I want to be transparent, but I want to give correct information to the community.”
CITY’S COSTS
For months, Galvan’s raised questions surrounding city expenses incurred since Miles presented the project to City Manager Manuel De La Rosa about four years ago.
So far, the city’s requested lobbyist Parker McCullough work to help former State Sen. Eddie Lucio Jr. and former State Rep. Eddie Lucio III pass House Bills 4347 and 2199, which allow cities to spend hotel occupancy tax revenue generated through developments to fund construction of convention centers and sports and entertainment projects.
The two bills would help Miles fund costs through hotel occupancy tax revenue.
Galvan also pointed to De La Rosa’s and City Attorney Mark Sossi’s work in reviewing the project’s documents.
“Sossi and Manny have spent a lot of time reviewing drafts and legal documents,” he said.
Meanwhile, the city’s EDC has paid $32,513 in property taxes on an agency-owned building at 2550 W. Expressway 83 which Western Spherical Developers leased last June, Ramiro Aleman, the agency’s executive director, said in an earlier interview.
Earlier this year, the agency also paid a $2,123 late fee, Cameron County Tax Office records show.
Aleman said the EDC paid the property taxes owed for the 2022 tax year as part of the agency’s partnership with the developer.
BACKGROUND
What would become the city’s biggest economic development project would create 1,013 jobs along with an additional 1,077 jobs during a three-year construction period, Miles has told commissioners during meetings.
As part of the project, Miles proposed the development of a sprawling “village” featuring two hotels, an entertainment center, a sports complex, restaurants and retail shops along with a five-acre “Crystal Lagoon.”
About four years ago, Tammy Huerta, daughter of the late Grammy-award winning singer Freddy Fender, helped spark talks with De La Rosa, Miles said.
