Developers for a long-delayed luxury resort in La Quinta presented an update to the City Council Tuesday evening after announcing last month that the opening of the initial phase of the project would once again face delays.
As planned, the luxury resort complex known as Talus, formerly known as SilverRock Golf Resort, will feature a 134-guest room Montage luxury hotel, a 200-room Pendry hotel, 29 single-family homes, 55 condos, a conference center, and a golf clubhouse.
Developer Robert Green informed the city that it would not be able to open a portion of the complex in the fall as planned. Green is projecting the Montage hotel will open early in 2024, with the 200-room Pendry hotel opening later that same year.
Green blamed the delay on rising costs for materials, equipment, and labor, in addition to higher interest rates. “If we had closed on a loan a year ago, we would have been paying 8.5% for that money, and now we’ll be paying over 10%,” he explained.
The price increases forced Green to rework the complex financing of the project, he explained, adding that two out of five of the critical financing elements were closed last month, totaling more than $150 million, with the other three close to being completed.
Many of the loans depend on the developer proving there is still interest in the residential side of the project.
“With everything that’s been going on in the world the last six months, you can imagine there was a lot of trepidation on everybody’s part with interest rates going up and the housing market slowing down,” said Green.
Despite concerns, Green thinks the buyers of Talus homes are immune to some of those worries.
“The kind of folks interested in buying our product are buying them as second and third homes to most likely rent out,” he said. “Most of them are cash buyers.”
So far, 11 out of the 29 single-family homes are under contract, selling for up to $1,450 per square foot. The developers have also secured 24 reservation agreements for the 55 condos they hope to convert into contracts.
Council members said they remained supportive of the project but wanted more transparency.
“I can’t go running without hearing about [the project],” said Councilmember Kathleen Fitzgerald. People are very concerned. It’s getting increasingly difficult to remain hopeful.”
Fitzgerald thinks La Quinta taxpayers are particularly concerned because the city has held up its end of the deal.
“We’ve met our obligations to you in a timely manner,” she told Green. “We built a park. We built a roundabout. We built a sheep fence. We realigned the channel.”
Councilmember John Peña and others emphasized the frustration they and their constituents feel, saying, “The public gets confused seeing other projects go up in the Coachella Valley be done in a year.”
Green pushed back, however, saying “[Talus] is the “first large-scale hotel built in the valley in 30 years. These are not simple projects to finance.” Green pledged that he wouldn’t walk away from the project and would see it through to the end.
Development of the property on Avenue 52 dates back to 2002 when the city bought the land and opened a golf course. The project was stalled until 2014, only to see funding secured and an estimated completion date of late 2020.