2000-23466 RESO Incomplete
RESOLUTION NO. 2000-23466
A RESOLUTION OF THE MAYOR AND MEMBERS OF THE CITY
COMMISSION OF THE CITY OF MIAMI BEACH, AUTHORIZING
THE CITY MANAGER TO CEASE NEGOTIATIONS WITH
AMERICAN RIVIERA REAL ESTATE COMPANY RELATIVE TO
THE REVISED SETTLEMENT AGREEMENT AND TO PROCEED
WITH A QUICK TAKE OF THE ABLON PARCEL; AND FURTHER
AUTHORIZING THE CITY MANAGER TO EXPLbRE OTHER
PARKING ALTElrnATIVES FOR THE AREA.
WHEREAS, on October 20, 1999, subsequent to an Executive Session of the Mayor and
City Commission, the City Commission directed the Administration and the Legal Department to
proceed to develop the Agreement of Lease and Development Agreement in accordance with the
terms of the revised Settlement Agreement, negotiated between the City of Miami Beach and
American Riviera Real Estate Company ("American Riveira" or "AR"); and
WHEREAS, in accordance therewith, on November 18, 1999, two draft Agreements of
Lease and a Development Agreement were forwarded to the principal of American Riviera, Ron
Bloomberg, and his attorneys for their review and comments; and
WHEREAS, pursuant to the terms of the revised Settlement Agreement, American Riviera
and the City had targeted December 16, 1999, as the outside date to finalize these documents and
to obtain title to the Chevron Parcel; and
WHEREAS, several meetings have been scheduled to further negotiate and address the
terms and conditions set forth in the contracts and to date, no substantive progress has been achieved;
and
WHEREAS, Ron Bloomberg has requested additional terms, which the City Administration
is not recommending for approval; and
WHEREAS, in light of the imminent completion of the construction documents for the
library, it has become necessary for the Administration to explore all possible alternatives to enable
the City to complete the Cultural Campus components; i.e. the library facility and parking garage;
and
WHEREAS,based upon recent conversations with the City's architects it is recommended
that the Commission reaffirm its direction to proceed with a "quick take" of the Ablon parcel; and
WHEREAS, in light ofthe waiver of development regulations granted to Miami City Ballet,
the City has determined that the Library's parking requirements can be met at the Fruitstand and
King parcels; and
WHEREAS, based upon the lack of progress with American Riviera, it is recommended that
all negotiations cease immediately and that the Administration proceed to explore other parking
alternatives, and to proceed with a "quick take" for the Ablon parcel, and the Administration also
recommends that a feasibility study be performed prior to committing to construct a parking garage
for the area.
NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City
Commission authorize the City Manager to cease negotiations with American Riviera Real Estate
Company relative to the revised Settlement Agreement and to proceed with a quick take of the Ablon
parcel; and further authorizing the City Manager to explore other parking alternatives for the area.
PASSED and ADOPTED this 12th day ofJanuary, 2000.
A~~ ~~
CITY CLERK
SRlCMC/rar
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APPROVED AS TO
FORM & LANGUAGE
. FOR EXECUTION
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PROPOSEDIREVISED SETTLEMENT AGREEMENT BETWEEN
AMERICAN RIVIERA REAL ESTATE COMPANY AND
THE CITY OF MIAMI BEACH AND
THE MIAMI BEACH REDEVELOPMENT AGENCY
The City of Miami Beach ("City") will pay $25 million, inclusive of all attorney's fees and expert
costs, to American Riviera ("AR"), subject to requisite releases from Judah Burstyn and Palm Court,
conditioned upon final approval by the City Commission:
. AR will sell and convey the Chevron parcel to the City, on or before December 16, 1999.
. AR will sell and convey the Ablon parcel to the City at the same time as the Chevron parcel
is conveyed.
. AR agrees to assign the Environmental Indemnification provided by Chevron regarding the
Chevron site. If environmental remediation is required, the City will recover any costs
incurred in connection therewith from the Indemnification Agreement or State EDI laws.
To the extent the Indemnification Agreement or the State EDI fund, in which said site
participates, does not provide reimbursement for such costs, the parties agree to share any
costs borne equally.
. Parties agree to jointly dismiss any pending/proposed legal proceedings/litigation or any
other dispute between the parties, with respect to the subject sites.
GARAGE RETAIL LEASE TERMS:
TERMS:
Owner: City of Miami Beach
Developer: American Riviera Real Estate Co. and/or assigns
Project Description: Approx. 25,000 gross sf retail (16,000 net useable sf)
Lease T enn: 25 years, one 25 year extension option
Possession Date: Upon Garage TCO.
Rent Beginning upon the earlier of any tenant occupancy or 6 months from the Garage TeO
Commencement: date, rent will commence and accrue up until 50% of the retail space is leased. Upon
50% lease-up, but no later than 3 years after rent commencement, any accrued rent will
be paid in equal installments over 5 years.
Base Rent: Base Rent is calculated based on the City's actual hard & soft construction costs and
proportionate share of land cost.
.
Base Rent Base rent will be adjusted at the end of the 5th lease year and every 5" lease year
Adjustments thereafter, based upon the lesser of 12% or the cumulative CPI over the previous 5 year
period. The Base Rent will never be less than the prior year's base rent.
Percentage Rent: Years 0-2, Lessee shall pay Base Rent, annually.
(as a percentage of Years 3-18, Lessee shall pay the greater afBase Rent or 35% of the gross retail revenue,
gross revenues): annually. (Estimated Annual Revenue $150,000-$190,000)
Years 19-34, Lessee shall pay the greater of Base Rent or 40% of the gross retail
revenue, annually. (Estimated Annual Revenue $215,000-$290,000)
Years 35-50, Lessee shall pay the greater of Base Rent or 45% of the gross retail
revenue, annually. (Estimated Annual Revenue $330,000-$480,000)
Right of F ITst City /Developer have right of first refusal to purchase each other's interest in the Project.
Refusal
Maintenance and AR will be responsible for any and all maintenance and repair of the garage retail areas
Repair: and their common areas.
Real Estate Taxes: Lessee shall be responsible for all real estate taxes associated with the property
improvements and underlying land.
Real Estate Taxes will be included and defined as Additional Base Rent in the event
taxes afe abated, waived or exempted. If taxes are reduced as a result of decline in
property values in the area, this provision will not apply.
Parking: Palm Court will have the parking rights for 13 spaces in the City garage at comparable
City parking rates. To the extent the City is able to build in excess of 400 parking
spaces (up to 500 spaces), AR will be granted parking rights for an additional 17 spaces
on a proportionate basis, (e.g. if the Garage is built containing 450 spaces, AR will
receive additional parking rights for 8 spaces, i.e. 50% of 17).
Valet Parking: AR will have the right to utilize the City Garage for valet parking service at comparable
rates and terms that the City is currently using with other valet operators.
Tenant AR will fund and improve all retail space and must evidence a reinvestment in the
Improvements: property of a minimum of $1,017,000 every 20 years.
Sub-Leases: Subject to City's reasonable consent.
OFFICE BUILDING LEASE TERMS:
TERMS:
Owner: City of Miami Beach
Developer: American Riviera Real Estate Co. and/or its assigns
Project Description: Approx. 48,000 sf office/retail, subject to City zoning laws.
.subject to City/Stem review
Lease Term: 50 years, with 2, 20-year extension options, subject to repappraisals
Possession Date: To be determined in the context of construction staging.
Base Rent: Earlier of Year 2 or upon 80% lease-up,- $25,000/yr. for 3 years.
Years 4-6, $50,000
.
Years 7-9, $75,000
Years 10, $100,000
Base Rent Base rent will be adjusted at the end of the 14th lease year and every 5" lease year
Adjustments thereafter, based upon the lesser of 12% or the cumulative CPI over the previous 5 year
period.
Percentage Rent: Lessee shall pay percentage rent equal to 2.5% of gross revenue annually, commencing
(as a percentage of 10 years after Rent Commencement. (Estimated Annual Revenue $30,000)
gross revenues):
Right of First City /Developer have right of first refusal to purchase each other's interest in the Project.
Refusal
Environmental Property is leased "as is" and developer is responsible for remediation. City has
Matters: conducted preliminary environmental studies evidencing no contamination.
Real Estate Taxes: Lessee shall be responsible for all real estate taxes associated with the property
improvements and underlying land.
Real Estate Taxes will be included and defmed as Additional Base Rent in the event
taxes are abated, waived or exempted. rf taxes are reduced as a result of decline in
property values in the area, this provision will not apply.
Parking: AR's required parking needs will be provided at the City garage at comparable City
parking rates.
Valet Parking: AR will have the right to use the City garage for valet purposes.
Re-appraisals: rf developer exercises extension options, the land will be re-appraised, based upon the
tenns set forth in the Lease Agreement, to detennine the new base rent based upon the
value in use in the 49" year and 69" year. The Base Rent will never be less than the
prior year's base rent.
Sale: Sale of the project will be subject to City consent.
Sub-Leases: Subject to City's reasonable consent.
C:\MYDOCU-l\BLOOMBGI
CITY OF MIAMI BEACH
CITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH, FLORIDA 33139
htlp:\\ci.miaml-beach.fl.us
COMMISSION MEMORANDUM NO.
~Co-oo
FROM:
Mayor Neisen O. Kasdin and
Members or the City Commission
Lawrence A. Levy~
City Manager
DATE: January 12, 2000
TO:
SUBJECT:
A RESOLUTION OF THE MAYOR AND MEMBERS OF THE CITY
COMMISSION OF THE CITY OF MIAMI BEACH, AUTHORIZING THE
CITY MANAGER TO CEASE NEGOTIATIONS WITH AMERICAN
RIVIERA REAL ESTATE COMPANY RELATIVE TO THE REVISED
SETTLEMENT AGREEMENT AND TO PROCEED WITH A QUICK TAKE
OF THE ABLON PARCEL; AND FURTHER AUTHORIZING THE CITY
MANAGER TO EXPLORE OTHER PARKING ALTERNATIVES FOR THE
AREA.
RECOMMENDATION
Adopt the Resolution.
ANALYSIS
On October 20, 1999, subsequent to an Executive Session of the Mayor and City Commission, the
City Commission directed the Administration and the Legal Department to proceed to develop the
Agreement of Lease and Development Agreement in accordance with the terms of the revised
Settlement Agreement, attached hereto, negotiated between the City of Miami Beach and American
Riviera Real Estate Company ("American Riveira" or "AR").
In accordance therewith, on November 18, 1999, two draft Agreements of Lease and a Development
Agreement were forwarded to the principal of American Riviera, Ron Bloomberg, and his attorneys
for their review and comments. Pursuant to the terms of the revised Settlement Agreement,
American Riviera and the City had targeted December 16, 1999, as the outside date to finalize these
documents and to obtain title to the Chevron Parcel.
Several meetings have been scheduled since such date to further negotiate and address the terms and
conditions set forth in the contracts. To date, no substantive progress has been achieved and Ron
Bloomberg has requested additional terms, which the City Administration is not recommending for
approval, such as:
.
American Riviera seeks additional consideration from the City for the acquisition of the fee
simple title for the Chevron parcel. The revised Settlement Agreement stipulated the City
would pay $2.5 million subject to American Riviera conveying the fee title for both the
Chevron and Ablon parcels. American Riviera raised the issue of the City paying a portion
of its cost to acquire fee title to the Chevron parcel on January 5, 2000.
AGENDA ITEM
DATE
R.. 11<-
1-\2-00
American Riviera
January 12, 2000
Commission Memorandum
Page 2
. American Riviera seeks a right of first refusal for the Ballet facility, in the event that the City
comes into possession of that facility.
. American Riviera seeks City support to amend the Zoning Ordinance to permit the
construction of the office building on top of the King parcel at an 80 foot height, which is
in excess of the 50 foot height limitation applicable to the Cultural Campus area.
. The City and American Riviera are unable to resolve a method by which the lease-up of the
retail portion of the garage and the retail portion of the proposed office building and the Palm
Court building will not conflict.
In light of the imminent completion of the construction documents for the library, it has become
necessary for the Administration to explore all possible alternatives to enable the City to complete
the Cultural Campus components; i.e. the library facility and parking garage.
Library
The library has been designed to be built on the Onyx and Ablon parcels and on a portion of the
King parcel. The City has not obtained an order of taking for the Ablon and has explored other site
alternatives for the library facilities.
Pursuant to conversations with the City's architect, it has been determined that shifting the library
onto the Onyx and King parcels (properties the City/RDA does control), or any alternate site, will
require are-design of the library. Essentially, the library design is site specific, with a view toward
creating a symmetry with the Ballet building along the northern edge of Collins Park and to take
advantage of the natural light afforded by its southern exposure. To move it would require a major
re-design with a potential cost exceeding $1 million. The Administration recommends, based upon
recent conversations with the architects and the City's outside counsel, Tom Goldstein, that
negotiations with American Riviera be terminated and that the Commission reaffirm its direction to
proceed with a "quick take" of the Ablon parcel.
Parking Garage
On February 17, 1999, the Administration presented a comprehensive report on parking for the
Cultural Campus. The report addressed (1) the Miami City Ballet's parking needs, (2) the various
parking alternatives for the area explored by the Administration, and (3) a report on the required
parking vs. actual parking available in the area.
It is anticipated that the legal parking requirements necessary to complete the Cultural Campus are
as follows;
American Riviera
January 12, 2000
Commission Memorandum
Page 3
# of Spaces for
Required Parking:
Library 81 ..
Ballet 76
Bass 22
Total 196
.. Exact # yet to be determined by Planning Department pending final construction plans.
Status on Meeting
Parkin!: Requirements:
Will be met on King and Fruitstand Parcel
Waived pending construction ofa garage
17 provided on site; 22 waived
In summary:
(1) Miami City Ballet's Parking Requirements:
On October 20, 1999, the Miami City Ballet obtained a waiver of development regulations
relative to parking to enable the opening of its facility. Such waiver was granted up until
such time as the City constructs a garage in the area.
(2) Parking Alternatives:
The various parking alternatives explored and analyzed are as follows:
. The closing or vacating of Liberty Avenue to provide additional off-street parking
or for construction of a garage.
. The bridging of a garage across Liberty Avenue on top of the Fruitstand and King
parcels.
. Developing a roof-top parking area on the library will exceed height limits for the
site. (Note: current height limit is fifty feet.)
. The inclusion of partial subsurface parking under the library would require extensive
and costly waterproofing of the garage structure and is not recommended by the
library's architect, Robert A. M. Stern.
. Using the Fruitstand parcel and the remainder of King parcel for surface parking or
two-level metered parking ramps, together with exploration of angle parking on both
sides of 23rd Street. The Administration would also try to identify other
opportunities for land acquisition for additional surface parking.
(3) Area Parking Requirements:
As reported on February 17, 1999, the area currently has 405 on-street and off-street parking
spaces. Proposed new off-street parking to be constructed on the King and Fruitstand parcel
may add an additional 72 spaces, just shy of the 81 spaces currently estimated to meet the
library's parking requirements pursuant to the zoning ordinance.
The report reflected that existing and proposed parking is sufficient to meet current and
proposed usage in the area. While the number of existing spaces is anticipated to meet the
parking needs for the area, the majority of the spaces are located in the Collins Park parking
lot at Collins Avenue and 21st Street and the spaces on Miami Beach Drive which provide
parking for the recreational open space and beach uses, and cannot be used to meet parking
requirements under the City's Land Development Regulations.
., .
American Riviera
January 12, 2000
Commission Memorandum
Page 4
Thus, the City has strived to develop additional off-street parking that will satisfy the legal
parking requirements of the cultural facilities. As a result of the waiver obtained by the
Miami City Banet, it is anticipated that compliance with the library's zoning requirement
will be met on the Fruitstand and King parcels if surface lots are developed. The
Administration would also try to identify other opportunities for land acquisition for
additional surface parking.
CONCLUSION
Therefore in light of the waiver granted to Miami City Ballet, the City has determined that the
Library's parking requirements can be met at the Fruitstand and King parcels. Nonetheless, it is
recommended that the City continue to pursue the acquisition of additional sites in the area to
provide adequate permanent parking facilities for the Cultural Campus which will ultimately meet
the City's long-term goals.
Based upon the lack of progress with American Riviera, it is recommended that all negotiations
cease immediately and that the Administration proceed to explore other parking alternatives, and to
proceed with a "quick take" for the Ablon parcel. The Administration also recommends that a
feasibility study be performed prior to committing to construct a parking garage for the area.
LAL/CIl6~
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