The City of La Quinta announced Wednesday the developer of the TALUS La Quinta luxury resort project is retooling the development due to rising labor, materials and interest rate costs to keep the development "economically viable."
News Channel 3's Jeff Stahl will have more on the delay tonight at 6:00 p.m.
City Manager Jon McMillen said the delays will mean an anticipated Fall of 2023 opening for portions of the resort will now be pushed back to early 2024 if all goes as anticipated.
"Construction at TALUS continues at the site, though slowed in recent months due to rising costs for materials, equipment, and labor, as well as higher interest rates which have caused the developer to have to retool project financing to keep the development economically viable," reads a message on the city's website Wednesday.
City officials said they remain confident and committed to making sure the TALUS project is completed.
"The City is holding the developer responsible for missing recent performance milestones and will continue to closely monitor progress as construction crews are expanded," reads the city's message.
TALUS, formerly known as SilverRock Golf Resort, will include a 134-room Montage luxury hotel, 200-room Pendry lifestyle luxury hotel, new golf clubhouse, and residential units tied to the two hotel brands.
The project has been in development for years and faced delays. In April 2021, the city even issued a notice of default to developer Robert Green Company. In Oct. 2021, officials announced the project was being rebranded to TALUS.
In an update released Thursday, city officials said developer Robert Green, president/CEO of The Robert Green Co., recently closed on two key financing elements for the project, bringing $48 million for the residential construction phase.
Another $108 million in EB-5 Program funds that Green is relying on has closed and will begin flowing into the project through First-Pathway Partners of Milwaukee, Wisconsin.
According to the city, the EB-5 Program is a federal foreign direct investment, immigration and regional economic development program that provides access to capital to U.S. businesses and creates American jobs at no expense to the American taxpayer. First-Pathway Partners is the EB-5 partner for TALUS.
Senior construction and Commercial Property Assessed Clean Energy (C-PACE) financing for the commercial components of the project are scheduled to close in the coming weeks as well, collectively representing over $290 million, Green said.
C-PACE offers long-term financing for energy efficiency, renewable generation, alternative energy, water use, seismic strengthening, and wildfire improvements to commercial and multifamily properties.
“We continue to overcome the challenges faced by our industry that have hampered our progress but will never diminish our resolve to complete this world-class project,” Green said.
“The restructuring of our debt financing into cost-competitive sources such as C-PACE and structured bond offerings at rates much lower than where normal commercial loans are currently priced was vital to the economic success of the project,” he added.
READ FULL STATEMENT FROM ROBERT GREEN COMPANY ON DELAY AND REFINANCING BELOW
Green will give a project update at the January 17, 2023, City Council meeting.
Stay with News Channel 3 for continuing updates.