Financing delays Hilton construction

OKALOOSA ISLAND, FL - Even the Hilton Hotels Corp. is not immune to the ongoing financial crisis.

Construction on the Hilton Emerald Coast, a four-star resort planned for the north side of U.S. Highway 98 just east of the Elks Lodge, tentatively was expected to start in February.
 
However, developer Ozean Development LLC still is finalizing its funding for the lavish project.

"We're having difficulty in the senior debt market," said Joseph Winkeler with Ozean. "Not because anything that has to do with the project, but just in general. I've been traveling extensively, and we've narrowed it down to approximately three different non-institutional and institutional debt markets, and we're just trying to put our best deal together to move forward on the project."
   
Although someone buying a house typically would make about 20 percent down payment and borrow the rest, Ozean is trying to receive a senior debt in which 40 to 50 percent of the funding would be in equity and the remaining 50 to 60 percent would be a loan.
Winkeler has traveled to Chicago and New York and was in Orlando last week to meet with lenders to try to finalize the project's funding.
   
Winkeler said the Destin architectural firm Dougherty & Chavez nearly is finished with the construction plans for the 450-room hotel. When the funding is finalized, Ozean will pull its building permit with Okaloosa County and start construction.
   
A soft opening for the Hilton Emerald Coast had been scheduled for May 15, 2010. However, that date no longer is feasible. It is expected to take 18 months for the resort to open after construction begins.
   
The construction is expected to employ 800 to 900 people. When the Hilton opens, Winkeler said the hotel will employ 340 to 400 people.
   
The Hilton Emerald Coast already has a handful of local employees. Attorney Jeff McGinnis is representing the developers, and local chef Johnny Earls, the former owner of Criolla's Restaurant, will head the food and beverage operations.
   
Although the slumping economy has delayed things, it has not persuaded the developers to reduce the scope of the project.
   
Amenities will include a full-service spa, salon, fitness club, two restaurants, a sushi bar, wine cellar, multiple bars, a grand ballroom, banquet space, coffee bar, arcade, horizon deck, retail stores and a kids club. The pool area will include tube slides, a lazy river and a children's area.
   
There also will be a full-service 140-slip boat marina that will be managed by a division of Galati Yachts.