On December 12, 2018, the City Commission unanimously adopted the Ocean Terrace Neighborhood Urban Design Plan, a concept plan for proposed public streetscape and park improvements to the Ocean Terrace area, prepared by The Corradino Group and Garcia-Pons + Associates (the “Neighborhood Design Plan”), and referred the proposed Neighborhood Design Plan to the Finance and Citywide Projects Committee (FCWPC) for prioritization and potential funding options. The Neighborhood Design Plan had previously been endorsed by the North Beach Steering Committee on August 29, 2018.

On February 22, 2019, after review of funding alternatives for the approximate $15 million that would be required to bring the Ocean Terrace portion of the Neighborhood Design Plan to fruition, the FCWPC recommended that the City explore entering into a public-private partnership that would fund the proposed improvements.

On March 22, 2019, the FCWPC recommended proceeding with negotiations with Ocean Terrace Holdings, LLC with regard to a development proposal which would provide for the Developer to complete a portion of the public improvements contemplated in the Neighborhood Design Plan, but which would require the vacation of certain City right-of-way areas, as described more fully below, subject to Developer granting the City with an irrevocable easement for the continued public use of the right-of-way areas for pedestrian and vehicular traffic, as modified by the public improvements, which will pedestrianize portions of Ocean Terrace. The proposed vacation would allow the Developer to make its proposed mixed-use project along Ocean Terrace, between 74th Street and 75th Street, financially viable, and creating new public spaces (including park space), to be funded and constructed by Developer, that is less auto-oriented, and more centered on the pedestrian experience.

On March 22, 2019, the FCWPC further recommended that the Administration obtain an appraisal and retain a consultant to assess the economic benefits which the proposed project would provide to the City.

On April 10, 2019, the City Commission adopted Resolution No. 2019-30771, accepting the recommendation of the FCWPC at its March 22, 2019 meeting to proceed with the negotiations for the proposed vacation.

In accordance with the City’s administrative policies, the vacation of the City streets, alleys, and/or rights of way, requires compliance with Article II, Sections 82-36 through 82-40, of the City Code (which establish the procedures governing the sale or lease of public property). Specifically, prior to approving a request for vacation, (1) the City's Planning Department shall prepare a written planning analysis, to be submitted to the City Commission concurrent with its consideration of the proposed vacation; and (2) the City shall obtain an independent appraisal of the fair market value of the property proposed to be vacated.

At the June 26, 2019 City Commission meeting (the first reading of the proposed vacation and development agreement), the City Attorney provided the Mayor and City Commission with his legal opinion that the proposed Ocean Terrace transaction is subject to the stringent and heightened approval requirements set forth in Section 1.03(b)(4) of the City Charter, which requires approval by a 4/7th vote of the Planning Board (which approval was obtained on May 21, 2019), and by a 6/7ths vote of the City Commission. The City Attorney’s memorandum regarding the legal mechanism for the vacation, and analysis regarding the applicability of the City Charter, is attached as Exhibit “A-2” hereto.

ANALYSIS OF THE PROPOSED VACATION

The City holds a right-of-way dedication to the following areas:

(1) a portion of Ocean Terrace, running from the centerline of 74th Street and the northern right-of-way line of 75th Street, consisting of a sixty (60) foot wide right-of-way, and containing approximately 25,200 square feet in total lot area; as shown on as shown on the Plat of the Townsite of Harding, recorded in Plat Book 34, Page 4 of the Public Records of Miami-Dade County (the “Harding Townsite Plat”);

(2) the north half of 74th Street, between Ocean Terrace and Collins Avenue, which consists of a 30-foot wide right-of-way containing approximately 8,880 square feet in total lot area; and

(3) a portion of 75th Street, between Ocean Terrace and Collins Avenue, which consists of a 40-foot wide right-of-way containing approximately 11,840 square feet in total lot area (collectively, (1) through (3) above, the “City Right-of-Way Areas”, each as shown on the Harding Townsite Plat).

The City Right-of-Way Areas are depicted in the sketch attached as Exhibit "A" hereto.

Various entities controlled by and affiliated with the principals of Ocean Terrace Holdings, LLC, namely, 7400 Ocean Terrace, LLC, 7410 Ocean Terrace, LLC, 7420 Ocean Terrace Investment, LLC, 7436 Ocean Terrace, LLC, 7450 Ocean Terrace, LLC, and 7441 Collins Avenue Investment, LLC (collectively, the “Developer”), and G & V Realty, LLC (the owner of 7401 Collins Avenue) own the properties abutting or in the vicinity of the City Right-of-Way Areas; which parcels are known as 7401, 7409, 7421, 7433, 7435, 7437, 7439, 7441, and 7449 Collins Avenue, and 7400, 7410, 7420, 7430, 7436, and 7450 Ocean Terrace (collectively, the "Property").

The vacation of the City Right-of-Way Areas would result in the City vacating approximately 45,920 square feet of existing right of way in accordance with the plat. Specifically, by virtue of the vacation, the right-of-way reverts to the abutting property owners to the centerline of the street, except that (1) with respect to 75th Street, which is located on the edge of the plat, the entire 40 feet of the 65 foot right of way, that was initially contributed by the predecessor owner of the abutting property along 75th Street, would revert to the Developer by operation of law (see, e.g., Pelican Creek Homeowners, LLC v. Pulverenti, 243 So. 3d 467 (Fla. 5th DCA 2018)); and (2) with respect to Ocean Terrace, the full 60 foot width of the Ocean Terrace right of way would revert to the Developer, as the Developer is the abutting property owner on the west side of Ocean Terrace (thereby entitling Developer to reversion of the western 30 feet to the centerline of Ocean Terrace) and Developer will, pursuant to the terms of the proposed Development Agreement, reserve the reversionary interest in the eastern 30 feet of Ocean Terrace. [1]

[1] As part of the Development Agreement, Developer will quit claim to the City any reversionary fee interest it may have in the separately platted public reservation area abutting the east side of Ocean Terrace, between the Ocean Terrace right-of-way and the waterfront, as depicted in Exhibit A-1 (the “Waterfront Parcel”) , subject to a reservation of the reversionary interest in the eastern 30 feet of the Ocean Terrace right of way. Upon the City’s vacation of Ocean Terrace, the eastern 30 feet of the Ocean Terrace right of way would thereby revert to the Developer, pursuant to the reservation in the deed.

The Developer intends to develop the Property as a mixed-use residential and commercial development in accordance with the requirements of the Ocean Terrace Overlay District (collectively, the "Proposed Development"), pursuant to a Florida Statute Chapter 163 development agreement to be entered into between the City and the Developer (the “Development Agreement”). The Proposed Development would be developed as a unified development site. In conjunction with Proposed Development, the Developer is requesting that the City vacate the City Right-of-Way Areas abutting 7401, 7441, and 7449 Collins Avenue and 7400, 7410, 7420, 7430, 7436, and 7450 Ocean Terrace, and has submitted its application to the City's Public Works Department with respect thereto, to permit Developer to utilize the F.A.R. associated with the City Right-of-Way Areas within the Developer’s Project (but with the City Right-of-Way Areas to continue to be used for pedestrian and vehicular travel). With respect to the proposed vacation of the 4,380 square feet of City right-of-way abutting 7401 Collins Avenue, the proposed vacation of the subject area shall be subject to and contingent on Developer’s agreement with the property owner to include the vacated right-of-way area as part of the unified development site for the Project.

As part of the Proposed Development, the Developer would develop, design, permit and construct, at the Developer’s sole cost and expense (with the exception of certain City fees, as set forth below), certain park and streetscape improvements between 73rd Street and 75th Street having a value upon completion of approximately $15 million, thereby implementing the vision of the Neighborhood Design Plan (“Park/Streetscape Project”). Ownership, operation and maintenance of the Park and Streetscape improvements would rest solely with the City.

Ultimately, to implement the foregoing, the City Commission would need to approve three major components for the Proposed Development:

(1) the vacation of the City Right-of-Way Areas (subject to an irrevocable easement in favor of the City, for public recreation purposes, public utilities and pedestrian and vehicular access), following the Planning Board’s approval of the vacation pursuant to Section 1.03(b)(4) of the City Charter (which approval was obtained on May 21, 2019);

(2) the Development Agreement, specifying the terms and conditions for the development of the Proposed Development and the Park/Streetscape Project; and

(3) amendments to the City’s Future Land Use Map and Zoning Map (as discussed more fully below).

As the three components of the Development are interrelated, the three components will “travel” together and be considered by the City Commission on the same date(s).

Planning Analysis

The Planning Department’s analysis of the proposed vacation, pursuant to Section 82-38 of the City Code, is attached as Exhibit “B” hereto.

Appraisal

The appraisal of the City Right-of-Way Areas valued the land and associated Floor Area Ratio (F.A.R.) of the City Right-of-Way Areas at $12,400,000 and is attached as Exhibit “C” hereto. The City’s preliminary cost estimate of the design and construction of the proposed Neighborhood Design Plan is $14.8 million, and is attached hereto as Exhibit “D.”

The Developer’s proposal to complete the Park/Streetscape Project, with a value of approximately $15 million (consistent with City’s cost estimate in Exhibit “D”), is well in excess of the $12.2 million appraised value of the City Right-of-Way Areas.

Economic Development Analysis

The City’s economic development consultant, Lambert Advisory, LLC,  has analyzed the anticipated economic benefits associated with the proposed Project. The consultant’s report is attached as Exhibit “E.” As the City;s Consultant noted in the report, the transaction provides the economic benefits.

As set forth herein, the Ocean Terrace development and corresponding improvements to      roadway and public space is envisioned to be a transformative project for the surrounding area and provide measurable incremental benefit to the City as a result of significant direct capital investment, as well as from on-going expenditure from its residents, visitors and employees. Estimates of the tangible impacts from direct and indirect expenditures are captured by this analysis. However, we clearly recognize that there are other potential intangible impacts – such as the project’s ability to serve as a catalyst for future development in the immediate area; however, these are not included in this analysis, as they are nearly impossible to quantify. In sum, the most notable economic impact benefit headlines from the Ocean Terrace development include:

• 1,270+ direct and indirect/induced construction (and related) jobs annually during the proposed two-year construction period, which generates a total of $122 million in direct and indirect/induced labor income during the construction period that will flow to the local and regional economy. o including an estimated $2.2 million to the City in permit and related fees;

• 115 net new direct full time equivalent (FTE) jobs generating $17.2 million (2019 $’s) in total annual wages available for expenditure within surrounding businesses;
incremental annual ad valorem tax revenue to the City of approximately $1.6 million upon stabilized operations; or, an estimated $27 million in net present value (NPV) over a 30-year projection timeline;

• an estimated $120,000 to $240,000 in incremental annual ad valorem tax revenue to the City of Miami Beach as a result of impacts to surrounding property values; and,

• $1.125 million in annual resort tax revenue upon stabilized operations to the City; or, an NPV of $19.1 million during a 30-year projection period. See Exhibit "E", page 4.

 The following table provides a summary of the long-term/recurring fiscal benefits to the City of Miami Beach: Figure 3: Summary of Estimated Long-term Incremental Fiscal Benefits to the City of Miami Beach from Ocean Terrace Development (Upon Stabilized Operations, 2019 $’s)

Source                                                             Annual                            NVP (30 yrs)
Ad Valorem Tax – Ocean Terrace                    $1,600,000                      $27,000,000
Ad Valorem Tax – Surrounding Properties       $180,000                          $3,200,000

Resort Tax – Ocean Terrace                            $1,125,000                      $19,100,000
Total                                                                 $2,900,000                      $49,300,000

Walker Parking Study

In accordance with City’s Parking Revenue Bond covenants, the City has obtained the opinion of its Parking/Rate Consultant, Walker Consultants with respect to the proposed removal of 60 metered parking spaces and 7 disabled spaces. The Walker report, which concluded that the “estimated annual loss of $77,460 (.0074% of FY17 net revenues) will not have a material adverse impact on the net revenues of the Parking Fund, is attached as Exhibit “H” hereto.

Proposed Amendments to City’s Comprehensive Plan and Land Development Regulations.

As noted above, the transaction would involve proposed legislative changes, to conform the zoning map to the vacation of the City Right-of-Way Areas.

The Property is currently located within the Ocean Terrace Overlay District, and the two separate underlying zoning districts are designated as CD-2, “Commercial Medium Intensity,” and MXE, "Mixed-Use Entertainment.

The proposed Development Agreement contemplates that the City Commission will approve amendments to the City’s Future Land Use Map and Zoning Map, to: (a) amend the Future Land Use Map to change the designation of the portions of the City Right-of-Way Areas designated PF, “Public Facility,” and ROS, "Recreation and Open Space," to the Future Land Use categories of CD-2, “Commercial Medium Intensity” and MXE, "Mixed-Use Entertainment"; and (b) amend the City’s Zoning Map to rezone the City Right-of-Way Areas from the current zoning classification of GU, “Government Use District,” to CD-2, “Commercial Medium Intensity” and MXE, "Mixed-Use Entertainment," and extending the boundary of the Ocean Terrace Overlay Zone to encompass the City Right-of-Way Areas.

As set forth above, the foregoing amendments will be heard together with the Vacation Resolution and approval of the Development Agreement, as the three components of the Proposed Development are interrelated.


Planning Board and Land Use and Development Committee Recommendations.

At the May 21, 2019 meeting of the Planning Board, the Planning Board unanimously recommended adoption of the LDR Amendments, and provided the requisite approval of the vacation, pursuant to Section 1.03(b)(4) of the City Charter. Separately, the Planning Board recommended that additional terms be included as part of the Development Agreement, namely (1) that the design feature at 74th Street be incorporated into Phase 1 of the Park/Streetscape Project; (2) that a passenger drop-off and pick-up location be incorporated into 75th Street; (3) that a plan be created for the 75th Street Parking lot so that it can be planned concurrently with the Ocean Terrace Project and the Park/Streetscape Project; and (4) that north-south beachwalk connectivity be maintained throughout the construction process.

At the May 22, 2019 meeting of the Land Use and Development Committee (“LUDC”), the LUDC favorably recommended the adoption of the LDR Amendments and recommended that several items be further negotiated (including the items recommended by the Planning Board). In an effort to be responsive to the comments raised by the Planning Board, LUDC and the public, Developer has agreed to all of the additional negotiation items, which include the following:

1. The design feature located on or about Ocean Terrace and 74th Street shall be completed as part of Phase 1 of the Park/Streetscape Project.

2. As part of the Park/Streetscape Project, Developer shall design and construct the side streets (73rd Street, 74th Street and 75th Street, from Collins Avenue to Ocean Terrace) to provide for an integrated and cohesive design aesthetic for the Park/Streetscape Project.

3. Developer shall ensure that the Preliminary Plans and Specifications address accessibility needs for elderly and/or disabled persons. The Park/Streetscape Project shall be designed to ensure that public access to the City’s beaches is maintained.

4. Developer’s Preliminary Plans and Specifications for the Park/Streetscape Project shall provide for a “reasonable flow” for ingress/egress of vehicles on 75th Street, with a proposed solution that may include either a drop-off loop or other turn around at the east end of 75th Street, or any other similar proposed solution as may be approved by the City Manager at the City Manager’s sole discretion, to ensure vehicular access to the 75th Street parking lot and/or access for drop-offs to the beach.

5. Developer’s Preliminary Plans and Specifications shall provide for ingress/egress for vehicles accessing the St. Tropez property located at 7330 Ocean Terrace and shall incorporate any comments with respect to ingress/egress as may be provided by the City Manager. Notwithstanding any other provisions in the Development Agreement to the contrary, the portions of the Plans and Specifications for the Park/Streetscape Project relating to ingress/egress for the St. Tropez shall be subject to approval by the City Manager or by the City Commission, at the City Commission’s sole discretion.

6. During construction of Phase 1 of the Park/Streetscape Project, Developer shall ensure there is continuous north/south beach walk access at all times, unless otherwise approved in writing by the City Manager.

At its June 14, 2019, the Finance and Citywide Projects Committee favorably recommended moving forward with the Development Agreement.

Conditions of the Proposed Vacation; Key Terms of the Development Agreement

A copy of the proposed Development Agreement is attached hereto as Exhibit "F". The vacation of the City Right-of-Way Areas would be conditioned on the Developer’s execution of a Development Agreement which contains the following key terms:

(1) Development of the Project.

Developer’s Proposed Development will be developed based on, and in accordance with, the requirements of the Ocean Terrace Overlay District as set forth in Sections 142-870 and 142-870.1 of the City Code. Within the Ocean Terrace Overlay District, the maximum height of a main use residential building shall not exceed 235 feet, and the maximum height of a main use hotel building shall not exceed 125 feet. Architectural projections will comply with the terms of the Development Agreement and other applicable provisions of the City’s Land Development Regulations. The current main permitted uses in the Ocean Terrace Overlay District are (a) apartments; (b) apartment/hotels; (c) hotels; (d) commercial; and (e) uses that serve alcoholic beverages. Package alcohol stores are prohibited in the Ocean Terrace Overlay District.

(2) Developer to Design and Construct the Park/Streetscape Project for the City.

Developer shall develop, design, permit, and construct, at its sole cost and expense, the Park/Streetscape Project; provided, however, that the City would be responsible for the zoning application fees, in the amount of up to $80,000, and would waive any fees for the City/Streetscape Project for which a waiver is permitted under the existing City Code, as set forth below. Ownership, operation and maintenance of the Park and Streetscape improvements would rest solely with the City.

The Development Agreement will include initial approval by the City Commission of the Concept Plan for the Park/Streetscape Project, which Concept Plan was designed by renowned landscape architect Raymond Jungles, and is attached as Exhibit “G.” The design for the Park/Streetscape Project shall be subject to regulatory approval by the Historic Preservation Board (“HPB”). Further, in recognition that the design of the Park/Streetscape Project may evolve during design development, the Development Agreement will require the City Manager’s approval of the final plans and specifications for the Park/Streetscape Project (and any modifications thereto), with all elements of the final plans and specifications relating to vehicular ingress/egress and access subject to the City Manager’s approval at the City Manager’s sole discretion.

(3) Timeframe for Completion of Project and Park/Streetscape Project.

As set forth in the table below outlining the various timeframes set forth in the Development Agreement, the Developer has proposed to complete the Park/Streetscape Project in two phases, with Phase 1 to be completed within 48 months following the Effective Date of the Development Agreement (the date the agreement is executed by the Parties and recorded), and with Phase 2 to be completed within 96 months following the Effective Date. The City will not issue a temporary certificate of occupancy (TCO) for the Proposed Development until the Developer has substantially completed the Phase 1 of the Park/Streetscape Project and shall not issue a final certificate of occupancy until the Developer has substantially completed Phase 2 of the Park/Streetscape Project.

As the Proposed Development is an important component for realizing the economic development benefits the City has long desired for the Ocean Terrace neighborhood and North Beach, as part of the Development Agreement, Developer has agreed that it will complete the Proposed Development not later than 96 months following the Effective Date, subject to a 24 month automatic extension if Developer timely delivers Phase 2 of the Park/Streetscape Project, and extension for force majeure and/or economic force majeure (for a maximum period of 30 months) pursuant to the terms of the Development Agreement.

(4) Developer to Grant Easements in Favor of City For the Public’s Continued Use of the City Right-of-Way Areas.

As a condition of the closing for the City’s conveyance to the Developer of the City Right-of-Way Areas, Developer shall grant a perpetual, non-revocable easement in favor of the City, for the City’s continued use of the City Right-of-Way Areas for public recreational, vehicular, and pedestrian use and access.

(5) Developer to Provide the City with Bond or Lender Agreement to Guarantee Completion of the Park/Streetscape Project.

As the City would have vacated the City Right-of-Way Areas prior to Developer’s completion of the Park/Streetscape Project, as a condition of closing, Developer has agreed to provide the City with a bond/letter of credit or a lender recognition agreement, in a form acceptable to the City, to secure Developer’s obligations and permit the City to step in and complete the Park/Streetscape Project in the event the Developer fails to do so.

In addition to the foregoing, Developer has agreed to other terms and conditions intended to protect the City’s interest in the Park/Streetscape Project, including provisions to (1) automatically assign the pertinent construction contracts to the City, should Developer default on its obligations; (2) require Developer and its contractors to indemnify the City as provided in the Development Agreement; (3) name the City as an express intended third-party beneficiary of the construction contract; and (4) name the City as a co-obligee on a performance and payment bond for the Park/Streetscape Project.

(6) Developer to Convey Its Fee Interest in the Public Reservation Area Located East of Ocean Terrace.

Developer shall convey to the City any right, title and interest the Developer has in the public reservation area depicted in Exhibit “A-1;” provided, however, that as explained in Note 1 above, the Developer would reserve its reversionary interest in the eastern 30 feet of the Ocean Terrace right of way.

(7) Enhanced Service Area for Beachfront Concession.

The Development Agreement provides that if Developer successfully secures a hotel operation at Ocean Terrace that is substantially similar to the quality of operations and level of service of the Delano Hotel (1685 Collins Avenue), the Shelborne Hotel (1801 Collins Avenue), or the Nautilus Hotel (1825 Collins Avenue), a comparable set which is substantially equivalent to a four diamond AAA rating, the Developer would have the right to utilize a maximum of 175 linear feet between 74th Street and 75th Street, which area represents approximately 10% of the total linear footprint of the Ocean Terrace Concession Area, for a beachfront concession offering enhanced beach equipment and food and beverage services for Hotel patrons (the Enhanced Service Area), to be offered through the City’s beachfront concessionaire, the Boucher Brothers Miami Beach, LLC.

Pursuant to the proposed development agreement, the arrangement for the Enhanced Service Area would permit the Hotel to utilize branded uniforms and beach equipment in the Enhanced Service Area. Under the proposed arrangement, the City would continue to receive the same percentage of gross revenues that the City currently receives under its Concession Agreement with the Boucher Brothers with respect to the sale of standard beach equipment and prepackaged food offerings (namely, 20% of gross receipts on sale of standard beach equipment, and 15% of gross receipts on prepackaged food offerings).

(8) Timing for Key Project Milestones and Completion of the Park Streetscape Improvements.

The Development Agreement will include timeframes for the various deliverables and submittals set forth in the Development Agreement. The Developer’s proposed timeframes, representing the key steps in the development process, are included in the Agreement and summarized below:

 

(9) Application Fees and Contribution for Monthly City Parking Passes.

In consideration for the Developer's commitment to complete the Park/Streetscape Project, and in recognition of Developer’s prior payment of $206,835.00 (as per invoice number 00091435) to the City in zoning application fees for the Proposed Development, Developer has proposed that the City cover the zoning application fees for both the Proposed Development and the Park/Streetscape Project, the maximum total amount of which would be $80,000. Developer has also requested the waiver of any other City fees relating to the Park/Streetscape Project, to the extent any such waiver is currently permitted under the City Code (i.e., without requiring any legislation to provide for any such waiver).

In addition, Developer has requested that in the event the City Commission, at its sole discretion, adopts any amendments to the City’s Land Development Regulations to provide any credit or refund for previously paid zoning application fees, the Development Agreement will provide the Developer with the right to obtain any such credit or refund for the corresponding portion of the application fees previously paid by the Developer for the Proposed Development (the total of which amounted to $206,835).

Finally, the City will budget and appropriate, from the General Fund, the amounts necessary to pay the Parking System for the costs of 100 monthly parking passes for use by the Developer and its contractors during construction of the Park/Streetscape Project and the Proposed Development, subject to the total aggregate not-to-exceed amount of $300,000. The monthly parking passes will be utilized at the following City-owned parking lots: (i) Collins Avenue and 75th Street, provided, however, that on weekdays, the maximum of 25 parking spaces may be utilized at this location at any time, with the remainder available for parking for the general public, and provided, further, that no parking spaces shall be utilized at the 75th Street parking lot on weekends or holidays; (ii) 299 72nd Street (until such time as the commencement of construction at this location); (iii) 8040 Collins Avenue; (iv) 8300 Collins Avenue or such other City lots as the City may designate.

Except with respect to the foregoing, Developer shall be responsible for all other governmental fees applicable to the Proposed Development and the Park/Streetscape Project.

(10) Staging.

Although Developer initially requested use of portions of the 75th Street parking lot for staging, Developer has been responsive to the concerns raised by the Planning Board and the City’s Land Use and Development Committee and has agreed to withdraw its request to use any portion of the parking lot for staging. Instead, Developer has agreed to the following:

(a) During construction of the Park/Streetscape Project, the Developer and its contractors will have the right to use the areas within Phases I and II of the Park/Streetscape Project as staging areas and lay-down yards in connection with the construction of the Park/Streetscape Project.

(b) During construction of the Proposed Development, the Developer and its contractors will have the right to use the area within Phase II of the Park/Streetscape Project as staging areas and lay-down yards in connection with the construction of the Proposed Development.


(11) Café.

The proposed Concept Plan includes an area of approximately 2,000 square feet, designated for use as an outdoor café serving the general public. The Development Agreement will provide that if the café is approved by the HPB, the Developer would have the right to operate the café generally consistent with the sidewalk café permit requirements as set forth in Chapter 82 of the City Code, and in accordance with the minimum standards, criteria and conditions set forth in Sections 82-385 to 82-388 of the City Code.


(12) Transfers or Assignments of the Proposed Development and Park/Streetscape Project Prior to Completion.

Developer has agreed to retain day-to-day management and operational control of the delivery of the Park/Streetscape Project at all times until its completion.

Developer has requested that it be permitted to transfer or assign any interest in the Proposed Development, including a sale of the entire project, without City Commission approval, provided Developer at all times retains operational control of delivery of the Park/Streetscape Project until its completion. The Administration and Developer are continuing their discussions regarding this matter.

Proposed Changes to the Development Agreement In Response to City Commission Direction at First Reading.

Since first reading, the Administration and the Developer have met on numerous occasions, and the Developer has updated the proposed Concept Plan and the proposed terms of the development agreement, in an effort to be responsive to the City Commission’s input at first reading. The changes include:

1) Updating the Phasing Plan to provide for a greater footprint of the overall Park/Streetscape Project to be completed in Phase 1, within 4 years of the Effective Date; and

2) Addressing the concern for loss of parking spaces via (i) a valet parking solution at both the 75th Street parking lot and 8040 Collins Avenue on weekends and holidays, which would mitigate the loss of parking associated with the Park/Streetscape Project, and requiring Developer to cover City losses, at a split of 75% Developer/25% City, up to the aggregate amount of $100,000, in support thereof, and (ii) providing flexibility for the City’s Parking Director to limit construction parking at the 72nd Street parking lot on weekends or holidays, as necessary to respond to parking demands on the lot; and (iii) if the City is able to legislatively allow the use of a vacant West lot for a temporary parking solution, the Developer has agreed to create a stone lot for overflow valet or construction parking, at their sole cost and expense.

3) Providing for earlier timeframe for completion of the Proposed Development, by reducing the automatic extension if Phase 2 of the Park/Streetscape project is timely completed from 3 years to 2 years; and

4) Reducing the potential for extension of timeframes based on economic force majeure from a maximum period of 36 months to 30 months; and

5) Clarifying the conditions precedent to the issuance of certificate of occupancy for the Proposed Development, to provide that the City shall not issue a temporary certificate of occupancy (TCO) prior to completion of Phase 1 of the Park/Streetscape Project, and shall not issue a final certificate of occupancy (CO) prior to completion of Phase 2 of the Park/Streetscape Project; and

6) Strengthening the rights of the City and the public with respect to the easement, to ensure the City will operate and control the Easement Area solely for public purposes, and in the same manner as other City right-of-ways (i.e., with the City’s ability to control all improvements to the Easement Area, all cultural or other programming of events in the Easement Area, and to limit Developer’s rights, so that Developer may only use the Easement Area in the same manner as made available to the public.

Open Issues.

The sole remaining open issue is the transfer or assignment of the private portion of the proposed development. The Developer has proffered that they will retain full control of both Phase 1 and Phase 2 of the Park/Streetscape project but they remain firm that restrictions related to transfers or assignments may substantially limit their ability to bring on development partners or restrict the project from being realized if third party investors view the hurdles of the transfer as a deed restriction on the property. The Administration remains open to reaching a mutually beneficial solution that keeps the goal of moving forward both the public project and the Proposed Development as the primary objective with the protection necessary to ensure we reach those goals.