2010-27377 ResoRESOLUTION NO. 2010-27377
A RESOLUTION OF THE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH,
FLORIDA, APPROVING THE SUBSTANTIVE TERMS
(AS SET FORTH IN THIS RESOLUTION) OF A
PURCHASE AND SALE AGREEMENT BETWEEN THE
CITY (PURCHASER) AND AMERICAN RIVIERA REAL
ESTATE, LLC. (SELLER, FOR THE REAL PROPERTY
LOCATED AT 340 23 ° STREET, MIAMI BEACH,
FLORIDA, IN THE AMOUNT OF $4,975,000, TO BE
FUNDED FROM PARKING OPERATIONS FUND 480
PREVIOUSLY APPROPRIATED IN THE CAPITAL
BUDGET FOR THE CULTURAL CAMPUS PARKING
GARAGE I; FURTHER AUTHORIZING THE CITY
MANAGER AND CITY ATTORNEY'S OFFICE TO
NEGOTIATE A FINAL PURCHASE AND SALE
AGREEMENT WITH SELLER, BASED UPON THE
TERMS SET FORTH HEREIN; AUTHORIZING THE CITY
MANAGER TO EXECUTE THE AGREEMENT ON
BEHALF OF THE CITY; PROVIDED, HOWEVER, THAT
IF THERE ARE ANY TERMS WHICH MATERIALLY
ALTER THE SUBSTANTIVE TERMS SET FORTH
HEREIN, THEN REQUIRING THE CITY MANAGER TO
BRING THE AGREEMENT BACK TO THE FULL CITY
COMMISSION, FOR ITS CONSIDERATION; IF AN
AGREEMENT IS EXECUTED, FURTHER AUTHORIZING
THE CITY MANAGER AND CITY ATTORNEY TO
EXECUTE ALL CLOSING DOCUMENTS AND OTHER
AGREEMENTS, AS REQUIRED, NECESSARY TO
EFFECTUATE SAID PURCHASE IN ACCORDANCE
WITH THE TERMS AND CONDITIONS OF THIS
RESOLUTION AND OF THE PURCHASE AND SALE
AGREEMENT.
WHEREAS, since the mid-1990s, the City of Miami Beach has made
considerable investments in cultural amenities in and around Collins Park, including the
Miami City Ballet building and the expansion of the Bass Museum of Art, which was
followed by the construction of the new Regional Library Building; and
WHEREAS, private investment in this area has also been significant over the
same period of time; and
WHEREAS, additional public parking has long been an identified need for this
area; and
WHEREAS, the City has discussed several alternatives to provide parking in the
area, including alternatives that that do not require a joint venture or land assemblage;
discussion of a joint venture project with the Gansevoort Hotel; and the purchase and/or
condemnation of 340 23ro Street which is owned by Seller (the "Property); and
WHEREAS, at the November 18, 2008 meeting of the Finance and Citywide
Projects Committee, the Committee discussed the various options, including a joint
venture with Seller; a joint venture with the Gansevoort; and the construction of a
traditional garage on the two City-owned surface lots; the Committee directed the
Administration to continue negotiations with Seller and return to the Committee with an
update; and
WHEREAS, at the September 3, 2009 meeting of the Finance and Citywide
Projects Committee, the Administration provided a status update on the negotiations
with Seller, and the Committee recommended that the item be brought back to the
Finance and Citywide Projects Committee meeting on October 29, 2009; and
WHEREAS, the Committee again raised the option of initiating eminent domain
proceedings to acquire the Property; and
WHEREAS, at the October 29, 2009 Finance Committee meeting, the
Administration provided a status update, and informed the Committee that the
Administration and Seller were finalizing the appraiser instructions, and that the process
to perform financial due diligence had begun; and
WHEREAS, the Committee further directed that the appraisal should determine
the fair market value of the Property; and
WHEREAS, the appraiser's determination of the fair market value the Property is
$3,900,000; and
WHEREAS, at the March 25, 2010 meeting of the Finance and Citywide Projects
Committee, the Committee was informed that, following additional negotiations between
the City and Seller, Seller had agreed to sell the Property to the City, for the
development of a public parking garage with ground level retail/commercial space; and
WHEREAS, the Finance Committee directed the Administration to prepare a
Purchase and Sale Agreement, based upon the following substantive terms:
• The purchase price for the Property is $4,975,000;
• Seller will deliver clear title to the Property to the City;
• Once the garage is open, Palm Court (the building owned by Seller located at
323 23`d Street, Miami Beach, Florida) will have the right to purchase 50 monthly
municipal garage permits at market rate;
• Until commencement of construction of the garage by City, Seller may continue
to use the surface parking lot currently located on the Property for its continued
use (as a surface parking lot);
• During construction, Seller may purchase up to 50 monthly permits elsewhere
throughout the City parking system (in such facilities and/or lots as shall be
determined by the City);
• As part of the purchase price, Seller shall turn over to City, the architectural
plans that have already been prepared by Seller to date, and Seller shall secure
the consent of Seller's architect for the City's use of said plans for the intended
purpose of designing and constructing the garage;
• If the City were to have valet storage in the garage, the City would not preclude
Seller from negotiating with the valet operator to also service Palm Court.
NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City
Commission hereby approve the substantive terms (as set forth in this Resolution) of a
Purchase and Sale Agreement between the City (Purchaser) and American Riviera Real
Estate, LLC. (Seller), for the real property located at 340 23`d Street, Miami Beach,
Florida, in the amount of $4,975,000, to be funded from Parking Operations Fund 480
previously appropriated in the Capital Budget for the Cultural Campus Parking Garage I;
further authorizing the City Manger and City Attorney's Office to negotiate a final
purchase and sale agreement with Seller, based upon the terms set forth herein;
authorizing the City Manager to execute the agreement on behalf of the City; provided,
however, that if there are any terms which materially alter the substantive terms set forth
herein, then requiring the City Manager to bring the agreement back to the full City
Commission, for its consideration; if an agreement is executed, further authorizing the
City Manager and City Attorney to execute all closing documents and other agreements,
as required, necessary to effectuate said purchase in accordance with the terms and
conditions of this Resolution and of the purchase and sale agreement.
PASSED AND ADOPTED this 14th day of April 2010.
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Condensed Title:
COMMISSION ITEM SUMMARY
A Resolution approving the substantive terms of a purchase and sale agreement for the property
located at 340 23`~ Street, for the purpose of developing a municipal parking garage, in the amount of
$4,975,000 to be funded from Parking Operations Fund 480 previously appropriated in the Capital
_Budget for the Cultural Campus Parking Garage I.
Key Intended Outcome Supported:
Improve Parking Availability
Supporting Data (Surveys, Environmental Scan, etc.): Only 21% of residents and 28% of
Businesses rate the availability of parking in Miami Beach as being the right amount.
Issue:
Shall the Mayor and City Commission approve the purchase and sale agreement to acquire 340 23~
Street, for the purpose of constructing a municipal garage in the Collins Park Neighborhood?
Item Summaryntecommenaatlon:
Since the mid-1990's, the City has made considerable investments in cultural amenities in and around
Collins Park. The initial investments include the Miami City Ballet building and the Bass Museum of
Art. This was later followed by the construction of the new Regional Library Building, and now the
renovation of Collins Park itself. The next funded phase includes the City Center ROW Project, which
will renovate the rights-of-way in this neighborhood.
The ground lessee of the private parking lot located at the corner of Park Avenue and 23rd Street, Mr.
Ron Bloomberg, has been in discussions with the City for a number of years to construct a public
parking garage on the land that he controls and the parking lot the City owns immediately behind the
Miami City Ballet building.
At the March 25, 2010 meeting of the Finance and Citywide Projects Committee, the Committee was
informed that, following additional negotiations between the City and ARRE, ARRE has agreed to sell
the parcel to the City, for the development of a public parking garage. As part of the agreement to sell,
ARRE requested additional consideration. The Committee recommended that the item be presented
at the April 14, 2010 Commission Meeting.
Recommendation: The Administration recommends that the City Commission approve the purchase
and sale agreement and adopt the Resolution.
Adviso Board Recommendation:
Finance and Citywide Project Committee; March 25, 2010
Financial Information: Funds previously appropriated from:
Source of Amount Account
Funds: 1 $2,709,560.06 Parking Operations Fund 480 FY 2008/09 Capital Budget
2 $2,265,439.94 Parking Operations Fund 480 FY 2009/10 Capital Budget
3
O PI Total $4,975,000
Financial Impact Summary:
Clerk's Office
Si n-Offs:
Department Director Assista t ity Manager C't anager
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Gity of Miami Beach, 1700 Convention Center Drive, Miami Beach, Florida 33139, www.miamibeachfl.gov
MEMO #
COMMISSION MEMORANDUM
TO: Mayor Matti Herrera Bower and Members of the City Commission
FROM: Jorge M. Gonzalez, City Manager ~"~t,y,~
DATE: April 14, 2010
SUBJECT: A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY
OF MIAMI BEACH, FLORIDA, APPROVING THE SUBSTANTIVE TERMS
(AS SET FORTH IN THIS RESOLUTION) OF A PURCHASE AND SALE
AGREEMENT BETWEEN THE CITY (PURCHASER) AND AMERICAN
RIVIERA REAL ESTATE, LLC. (SELLER), FOR THE REAL PROPERTY
LOCATED AT 340 23RD STREET, MIAMI BEACH, FLORIDA, IN THE
AMOUNT OF $4,975,000, TO BE FUNDED FROM PARKING OPERATIONS
FUND 480 PREVIOUSLY APPROPRIATED IN THE CAPITAL BUDGET FOR
THE CULTURAL CAMPUS PARKING GARAGE I; FURTHER AUTHORIZING
THE CITY MANAGER AND CITY ATTORNEY'S OFFICE TO NEGOTIATE A
FINAL PURCHASE AND SALE AGREEMENT WITH SELLER, BASED UPON
THE TERMS SET FORTH HEREIN; AUTHORIZING THE CITY MANAGER
TO EXECUTE THE AGREEMENT ON BEHALF OF THE CITY; PROVIDED,
HOWEVER, THAT IF THERE ARE ANY TERMS WHICH MATERIALLY
ALTER THE SUBSTANTIVE TERMS SET FORTH HEREIN, THEN
REQUIRING THE CITY MANAGER TO BRING THE AGREEMENT BACK TO
THE FULL CITY COMMISSION, FOR ITS CONSIDERATION; IF AN
AGREEMENT IS EXECUTED, FURTHER AUTHORIZING THE CITY
MANAGER AND CITY ATTORNEY TO EXECUTE ALL CLOSING
DOCUMENTS AND OTHER AGREEMENTS, AS REQUIRED, NECESSARY
TO EFFECTUATE SAID PURCHASE IN ACCORDANCE WITH THE TERMS
AND CONDITIONS OF THIS RESOLUTION AND OF THE PURCHASE AND
SALE AGREEMENT.
ADMINISTRATION RECOMMENDATION
Adopt the Resolution
ANALYSIS
The Collins Park Neighborhood is generally referred to as the area in and around Collins
Park, and is also generally referred to as the Cultural Campus and the CANDO districts.
Although the specific boundaries of each of these three areas may differ slightly, the
main core of the neighborhood is Collins Park.
Since the mid-1990's, the City has made considerable investments in cultural amenities
in and around Collins Park. The initial investments include the Miami City Ballet building
and the expansion of the Bass Museum of Art. This was later followed by the
construction of the new Regional Library Building, and now the renovation of Collins
Commission Memorandum
April 14, 2010
American Riviera Real Estate
Page 2
Park itself. The next funded phase includes the City Center ROW Project, which will
renovate the rights-of-way in this neighborhood.
Private investment in this area has also been significant over the same period of time.
Private development includes the Gansevoort Property, the W Hotel property, the Setai,
and Arte City, to name just a few. There is also a well organized neighborhood
association and the parking lot for Collins Park is one of the locations for Art Basel.
Additional public parking has long been an identified need for this area. Early concepts
from the 1990's contemplated the construction of a parking structure on the Collins Park
parking lots east of Collins Avenue between 21 S` and 22"d Streets. This concept was
later abandoned due to Historic Preservation appropriateness issues and the desire to
maintain the open view corridor from the street and Collins Park east to the ocean. Later
concepts have looked at underground parking on the same site as well as other parking
structures at various locations in the area. The most viable of these concepts are
presented below.
The City has discussed several alternatives to provide parking in the area, including
alternatives that that do not require a joint venture or land assemblage, discussion of a
joint venture project with the Gansevoort Hotel, purchase and/or condemnation of 340
23rd Street, which is owned by Mr. Ron Bloomberg as principal of American Rivera Real
Estate (ARRE) and is adjacent to a city-owned parcel; or a development agreement with
ARRE for a joint venture retail/garage project.
City Garage on City-Owned Progertv on 23`d Street
The City owns two surface parking lots along 23rd Street on either side of Liberty
Avenue. These two lots are behind the Miami City Ballet building and the Regional
Library building, respectively. It is plausible to construct a traditional garage on these two
lots, provided the City is willing to vacate Liberty Avenue since the garage would need to
cross this street. The City issued an RFO for an architect for this concept and
Arquitectonica was selected. However, this process was stopped before an agreement
for services was brought to the City Commission in order to enter into discussions with
ARRE. An alternative to this concept is to construct robotic parking garage(s) on one or
both of the two surface lots.
Joint Venture Gansevoort
The Gansevoort Hotel owns a surface lot across Collins Avenue from its property.
Recently, the City and the previous owners of the resort property had discussed a joint
venture on this lot. Due to foreclosure, this property is now owned by Credit Suisse.
While Credit Suisse is not interested in selling this property to the City at this time, there
may be interest in continuing discussions of a joint venture with the City, should the City
be unsuccessful in providing parking elsewhere in the neighborhood.
American Riviera Real Estate - 340 23rd Street.
The ground lessee of the private parking lot located at the corner of Park Avenue and
23rd Street, Ron Bloomberg/American Riviera Real Estate, has been in discussions with
the City for a number of years to construct a public parking garage on the land that he
controls and the adjacent parking lot the City owns immediately behind the Miami City
Ballet building. Mr. Bloomberg has an option to purchase the property he leases
contingent upon an agreement with the City, so that either he or the City would be fee
Commission Memorandum
April 14, 2010
American Riviera Real Estate
Page 3
simple property owner for that lot. Conceptually, a structure at this location would
provide for ground floor retail and about 360 parking spaces.
At the November 18, 2008 meeting of the Finance and Citywide Projects Committee, the
Committee discussed the various options, including a joint venture with ARRE, a joint
venture with the Gansevoort, and the construction of a traditional garage on the two City-
owned surface lots. The Committee directed the Administration to continue negotiations
and return to the Committee with an update.
At the September 3, 2009 meeting of the Finance and Citywide Projects Committee, the
Administration provided a status update on the negotiations with American Riviera Real
Estate Company (ARRE), for the development of a joint venture garage in the Collins
Park neighborhood.
At that meeting, the Committee:
• Authorized the expenditure of funds to hire an appraiser;
• Authorized staff to proceed with financial due diligence on American
Riviera Real Estate Company and its principles to determine financial
capacity;
• Appointed Commissioner Ed Tobin as liaison to the project;
• Requested an analysis be done between this project and other garage
projects done by the City;
• Recommended that the item be brought back to the Finance and Citywide
Projects Committee meeting on October 29, 2009.
At the October 29, 2009 Finance Committee meeting, the Administration provided a
status update, and informed the Committee that the Administration and ARRE were
finalizing the appraiser instructions, and that the process of hiring Kroll to perform
financial due diligence had begun. The Committee recommended that the Administration
proceed with the appraisal, and that the hiring of Kroll should be deferred to a future
Committee meeting.
The Committee further directed that the appraisal should determine the fair market value
of the parcel owned by ARRE. The parties agreed to use Appraisal First to conduct the
appraisal, and the appraiser's determination of the fair market value of fee simple
ownership of the parcel is $3,900,000. It should be noted that the preliminary appraisal
was for $4,000,000, but this figure was refined by the appraiser based on feedback from
City staff. According to the Miami-Dade County Property Appraiser, the property's 2009
assessed value was $3,279,500, or 84% of the appraised value, which is consistent with
the Administration's experience, which is that the tax assessed value is generally 85% of
a property's market value. The 2007 and 2008 assessed value of the property was
$4,331,796, indicating a market value of more than $5 million.
Throughout the course of the negotiations, the City's preference has been the outright
purchase of the parcel from ARRE, for the development of a public parking garage. The
City's offer to purchase the parcel has included a premium over and above the
appraised value of the property, as an incentive for ARRE to sell the property and in
consideration of a number of factors, including the additional cost of the ARRE's
purchase option, tax implications, and architectural plans (valued at $100,000 to
$150,000). ARRE has consistently rejected the City's offer of an outright purchase.
Commission Memorandum
April 14, 2010
American Riviera Real Estate
Page 4
At the February meeting of the Finance and Citywide Projects, the Committee briefly
discussed the item and requested that the Administration present the terms of a deal to
the Committee's March 25, 2010 meeting, or, if a deal has not been reached, to be
prepared to discussing other options, including condemnation of the property.
Subsequent to the February meeting of the Finance Committee, the City Attorney's
Office began to explore the condemnation option should the City Commission give
direction to pursue that option.
At the March 25, 2010 meeting of the Finance and Citywide Projects Committee, the
Committee was informed that, following additional negotiations between the City and
ARRE, ARRE has agreed to sell the parcel to the City, for the development of a public
parking garage. As part of the agreement to sell, ARRE requested additional
consideration.
The Substantive Terms of the Agreement:
• The purchase price for the Property is $4,975,000;
• Seller will deliver clear title to the Property to the City;
• Once the garage is open, Palm Court (the building owned by Seller located at
323 23`d Street, Miami Beach, Florida) will have the right to purchase 50 monthly
municipal garage permits at market rate;
• Until commencement of construction of the garage by City, Seller may continue
to use the surface parking lot currently located on the Property for its continued
use (as a surface parking lot);
• During construction, Seller may purchase up to 50 monthly permits elsewhere
throughout the City parking system (in such facilities and/or lots as shall be
determined by the City);
• As part of the purchase price, Seller shall turn over to City, the architectural
plans that have already been prepared by Seller to date, and Seller shall secure
the consent of Seller's architect for the City's use of said plans for the intended
purpose of designing and constructing the garage;
• If the City were to have valet storage in the garage, at least 50 spaces will be
provided for valet storage, and the City would not preclude Seller from
negotiating with the valet operator to also service Palm Court.
Mayor Matti Bower asked what the procedure is currently for valet operations in the
City's other garages. City Manger Jorge Gonzalez stated that the City has not used
public garages for valet operation, other than a few spaces that are contractually
obligated in the Anchor garage as part of the Lowes and Royal Palm agreement, 5th and
Alton is the only garage has been used for valet storage. The question was also raised
as to what is the current policy on the purchase of monthly permits in other garages. The
Parking Department's policy is to evaluate the usage in the garage to determine the
number of spaces that will be available for monthly permits. The policy is that in no case
will the number of permits exceed 60% of the spaces in the garage. The 50 monthly
permits proposed to be available first to Palm Court represent 13% of the total spaces in
the garage, and 60% of the number of spaces in the garage is approximately 230
spaces, of which 50 would be available first to ARRE. Commissioner Jorge Exposito
asked how many spaces would be in the Collins Park garage. Mr. Gomez stated that
Commission Memorandum
April 14, 2010
American Riviera Real Estate
Page 5
approximately 360 are planned for the garage. The Committee recommended that the
item be presented at the April 14, 2010 Commission Meeting.
CONCLUSION
The Administration recommends that the Mayor and City Commission approve the
substantive terms of the purchase and sale agreement, for the purchase of the property
for the amount of $4,975,000; further authorizing the City Manager and City Attornery to
negotiate the final purchase and sale agreement based on the terms set forth in the
Resolution, and to execute the agreement on behalf of the City, unless there are any
terms which materially alter the terms set forth in the Resolution, in which case the
agreement will be brought back to the Mayor and City Commission for consideration.
JMG/JGG/kc
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