NEW BUSINESS  19.

COMMITTEE MEMORANDUM

HISTORY:

The Jesta Group purchased the Clevelander South Beach Hotel (hereinafter the "Clevelander"), located at 1020 Ocean Drive, and the Essex House Hotel (hereinafter "Essex House"), located at 1001 Collins Avenue, in October 2018.

An application has been submitted to the Historic Preservation Board (HPB) for a project involving the renovation of the Essex House and construction of an addition.  As part of this project, the firm is seeking to invest in the Essex House and connect it with the Clevelander via a pedestrian bridge that will span over Ocean Court.   Pursuant to Section 82-37(a) of the City Code, the Jesta Group is seeking an aerial easement over a portion of the Ocean Court alleyway, adjacent to their properties, for the construction of a pedestrian bridge, following the same general framework as other bridge connector projects like the Tides and the Betsy.

The Clevelander and Essex House are separated by a City public right of way known as Ocean Court, an alley that runs south to north parallel to Ocean Drive.  Ocean Court was dedicated by plat to the City as a public right of way; this dedication also includes the air rights over the Ocean Court right of way (the air rights over the Ocean Court right of way are referred to hereinafter as the "Easement Area").

The HPB would need to approve the design of the bridge, which is located at the 3rd story level,  to ensure no disruption in vehicular traffic to the service alleyway.  The pedestrian bridge will, among other things, increase the circulation and functionality of these two prominent hotels and, thus, potentially benefit the City's tourism industry.

Under an air rights easement, the Jesta Group shall bear any and all costs of installation, maintenance, repairs, taxes, insurance and any and all other costs and expenses, including any necessary relocation or undergrounding of existing utilities in conflict with the proposed pedestrian bridge, involved in its installation, operation and use.

ANALYSIS:

Pursuant to Sections 82-37, the sale or transfer of City property, including any interest in City property, as with an air rights easement, is to be referred to the Finance and Citywide Projects Committee. Pursuant to Section 82-38, the Planning Department is to prepare a written planning analysis, which will be submitted to the City Commission concurrent with its consideration of the proposed conveyance.

The City' s procedures for the lease or sale of public property also require an advertised public bidding process and an independent appraisal. However, the public bidding requirement may be waived by 5/7th vote, pursuant to Section 82-39 (b), upon a finding that the public interest is served by waiving such condition.

The City has obtained an appraisal for the air rights easement area (ATTACHED), the cost of which is reimbursable by the applicant.

The purpose of this appraisal is to form an opinion of the market value of an aerial easement above Ocean Court alley between the two properties known as the Essex House and the Clevelander. The easement parcel consists of an aerial easement that begins 42.5 feet above the existing street level and exceeds upward to 56.5 feet. The width of Ocean Court alley is 20 feet and width of the bridge is 6 feet. The square footage of the bridge is 6 feet x 20 feet or 120 square feet of area and 1,680 cubic feet of air space.

Based upon the appraisal of the property and market data analysis, the market value of the aerial easement parcel, described herein, as of July 23, 2019 is estimated at  $135,000.

CONCLUSION:
The Administration recommends that the applicant identify and proffer a public benefit for the project to be considered.  Should that public benefit be accepted that the City Commission waive the bidding requirement and further that the applicant pay the fair market value as determined by the appraiser.