LTC 122-2011 Sunrise Plaza Update . .
-�--P B EAC H '
OFFICE OF THE CITY MANAGER
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LETTER TO COMMISSIO
NO. LTC # 122 -2011
TO Mayor Matti Herrera Bower and - Members of the City Commission
:FROM: Jorge M. Gonzalez, City Manager
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DATE:.. May 16, 20 -11 r
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SUBJECT: Sunrise Plaza Update
:-
The purpose of this' Letter to Commission,(LTC) is, to inform you that the City and South Beaan OgBan M.
Parcel Ltd (the Continuum) have executed three new agreements and the City received "a check in the
`amount of $347,000 for the permitting, construction and inspection of the Sunrise Plaza: and Al suOmit
a permit application to FDEP by May 20, 2011.
The March 1999 Development - Agreement between the City of Miami Beach and the Continuum
i required the Continuum to construct the Sunrise Plaza Project, which lies directly east of the South
Pointe Drive terminus. This Develop ment;Agreement, - as well as the associated Design Review
Board. Order No.. 9611, contained. performance requirements in order for the final phase of the
Continuum to receive final Certificate of Occupancy CO The Development Agreement, amon
other things, required that. the east terminus of South Pointe'Drive 'be improved in a manner
consistent with a concept plan commonly referred to as the Sunrise Plaza.
In February- 2008; the Continuum sued °:the City of Miami Beach, claiming the City breached the A
terms of the 1999 Development Agreement based upon:a change made in regulatory procedures in
an action styled South Beach Ocean Parcel, ll, LTD. V. City of Miami Beach, Case No. 08- 10129 CA
- 40. During the trial, the court pressed both parties to come to a quick resolution of the case. The City
and the Continuum were able to settle the matter, which resulted in a letter agreement (Attachment
A). The circuit court accepted the settlement, and- the'case was dismissed with prejudice. with the
court retaining jurisdiction to enforce the terms of the Settlement Agreement.(Attachment B). The
settlement. agre6ment the Continuum to the final phase into three sub- phases.
As_oart of ths,Agreement, the City required the_Continuum to design, permit and construct Sunrise
Plaza, while holding back the issuance of :CO's for particular defined retail bays or alternatively
allowing the Continuum. to enter into,ah' Escrow Agreement with the City. -Amendment No. 1 to the
Letter Agreement allows the City to undertake construction of Sunrise Plaza upon payme`nt by the
Continuum for .the .cost -of. construction. Since the Amendment is a modification. of .the original
Agreement,. the circuit court would, still retain jurisdiction over the matter, should any enforcement
issues arise..,
In June 2009, ,the Continuum, submitted the Sunrise Plaza conceptual.. plan to the Florida
Department of Environmental Protection (FDEP) for initial.consultatio.n.ln April 2010, the Continuum
submitted.to the City a set of _revised drawings based on ; FDEP's comments:
In June 2010, the :City'prepared a cost estimate for these drawings via'an`outside consultant. Upon
Public Works Department review, it was determined that submitted plans lacked the civil
:. engineering component, which was subsequently`submitted by the Continuum to the.City in October
2010-The City commissioned another cost" estimate. for the completed set of drawings using an
outside consultant. -A finalized cost estimate of $346,652 was submitted in October 2010 and
includes the costs_ of. construction,, permitting, construction engineering : inspection, and a
contingency.
LTC - Sunrise Plaza
May 13, 201.1
Page 2 of 2
Using the most .recent cost estimate, negotiations to amend the Letter Agreement of 2008 began
between the City Attorney's.- Office, the -City Manager's Office, the Public Works Department and the
Continuum in November 2010. This updated Letter Agreement includes three components:
• An amendment to the Letter Agreement of 2008
A funding agreement
• A perpetual non - exclusive easement agreement.-
The Continuum and City have executed the Amendment to the Letter Agreement, the Funding
Agreement, and the .Perpetual Non- exclusive Easement Agreement. On May. 12, 2011, the
Continuum remitte&the funds the - amount of $347,000 as Well as the applicable construction
documents.
The City is having the survey updated and will submit a permit application to FDEP by May 20, 2011.
It is estimated that the permitting, process will take 6.months. After the FDEP permit is received, the
City will' solicit a proposal for construction via JOC. It will take approximately two to, three month's to
negotiate,, award, and obtain local permits: The actual construction is estimated to take five to six
.months. In total, it is anticipate:d� that Sunrise Plaza will be operational in approximately 13 to 15
_months after submittal of the FDEP permit application.
If you have. any questions, please feel free to call me.
Attachment:
A. Letter Agreement
B. Court Order
-DRB/ /HDC /RWS
F: \WORK \$ALL \(1) EMPLOYEE FOLDERS \Rick Saltrick \LTCs \LTC for Sunrise Plaza.doc
n Attachment A
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101AMI BEACH
City of Miami Beach, 1700 Convention Center Drive, Miami Beach, Florida 33139, www.miamlibeachfi.gov
Office of the City Manager
Tel: (305) 673- 7010,'Fax: (305) 673 -7762
March 11, 2008
Mr. Ian Bruce Eichner
Continuum Company, LL C
667 Madison Avenue, 14 1h Floor
New York, New York 10021
Re Amended and Restated Development Agreement between the City of Miami Beach and
South Ocean,�Beach Parcel Ltd., dated March 5, 1999
Conditions for Extension of Time.for Performance
Dear Mr. Eichner:
Pursuant to your representatives' recent discussions' with Assistant City Manager Tim
Hemstreet regarding the above - referenced matter, the foregoing Letter Agreement shall confirm
the understanding between the City of Miami Beach (City) and South Beach Ocean Parcel Il,
Ltd (Developer).
The `above noted Development Agreement, as well as the associated Design Review Board
Order No. 9611 (the DRB Order), contains certain performance requirements that must be met
in order for the final phase of the South Beach Ocean Parcel to receive the final Certificate of
Occupancy (CO) for all portions of the final phase of development. The Development
Agreement, among other things, requires that the east terminus of Biscayne Street (South
Pointe Drive) be improved in a manner consistent with a concept plan commonly referred to as
the "Sunrise Plaza ". The City has been advised by Developer that it is ready to receive its final
CO for. portions of the final phase, ' known as .Continuum 11, but.that it has not yet complied with
certain provisions of the Development Agreement prior to receiving its final CO..
City agrees to allow Developer to separate -this final phase (Continuum II) into three sub -
phases: the Residential Tower and town -homes (Sub -Phase II(A)); the sub -phase for
approximately 5900 square feet of the retail portion of the project, consisting of bays 2, 3, 4, 5,
6, 8 & 9, as depicted in the attached site plan as Exhibit A hereto (Sub -Phase II(B)); and all
remaining aspects of the project (Sub -Phase II(C)). The purpose of this Agreement is: (i) to
allow Sub -Phase II(A) to receive its CO on or before March 12, 2008; (ii) to allow the portions of
Sub -Phase II(C) to receive CO's individually or collectively as they are completed; and (iii) to
allow certain requirements from the Development Agreement to be attached to the CO's for
Sub -Phase II(B), or until a mutually agreed upon escrow agreement is entered into between . the
City and. Developer, at which time the City will issue CO's for Sub -Phase ll(B).
Mr, -Ian Bruce Eichner
March 11, 2008
Page 2 of 5
Notwithstanding the City's agreement to issue a final. CO on Sub-Phase II(A). by March 12,
2008, the following pending elements must be completed and /or satisfied (as provided herein) in
accordance with the timelines set forth in this Agreement or, where not set forth, as shall be
agreed to by -the City and Developer, as provided for below:
1. Sunrise Plaza Developer shall design, permit, and construct the "Sunrise Plaza" at the
eastern terminus of Biscayne Street, inclusive of an appropriate pedestrian connection of
South Pointe Drive with the beach, in a manner to be reasonably approved by City, and
all other regulatory agencies, and construction must be certified by the Developer's
Engineer of Record. . The City shall use best efforts to cooperate in the permitting of
Sunrise. Plaza, including but not ,Limited to: (i). executing required and completed
applications that are without deficiencies within ten ,(10) business days of receipt; (ii)
approving modifications requested by any other governmental agency with jurisdiction
over the construction of Sunrise Plaza, or provide reasonable alternatives that in the
opinion of the City also meet the regulatory requirements, within ten (10). business days.
The City will issue a CO for Sub -Phase 11 (B) when the construction of Sunrise Plaza is
completed or an Escrow Agreement is entered into between the City and Developer as
set forth in Paragraph 2 below, whichever occurs earlier. The turn -over of the Master
Condominium Association shall not occur until Developer has completed the
construction of Sunrise Plaza as Developer agrees that it will remain directly responsible
for the - completion of Sunrise Plaza.
2. Escrow Agreement The City and Developer shall enter into an Escrow Agreement, after
which Developer will be eligible to receive CO's for Sub -Phase 1I(B). The Escrow
Agreement will include but not be limited to the following terms: (i) Developer shall place
into escrow with Tew Cardenas LLP ( "Escrow Agent ") the amount of $900,000 ( "Escrow
Funds ") from which Developer will receive all proceeds; (ii) ` Developer shall design,
permit, and construct Sunrise Plaza; (iii) Developer shall be permitted to use the Escrow
Funds to pay for the. construction of Sunrise Plaza, after presenting a pay application to
Escrow Agent and the City has reasonably confirmed that the subject work has been
performed to the full reasonable satisfaction of the City; (iv) Developer agrees to meet
milestones in the .performance schedule identified in Exhibit B attached hereto and
further agrees to the City drawing down against this. Escrow in the amount specified in
the performance schedule if any milestone if missed; (v) Developer further agrees that
any proper drawdown by the City is non - refundable, for the City's sole use at its sole
discretion, regardless of any future performance by Developer; (vi) The parties agree
that the purpose of this Escrow Agreement and its terms is to secure performance by the
Developer and not to replace or supplant performance by Developer with regard to the
design, permitting, and construction of Sunrise Plaza, and, , therefore, Developer will
remain responsible for performance of Sunrise Plaza regardless of any drawdown of the
Escrow amount by either party; (vii) In the event that costs for performance for the
design, permitting, and construction of. Sunrise Plaza exceed the initial or any remaining
amounts of the Escrow Agreement, Developer agrees to immediately fund any shortfall;
(viii) After the completion of Sunrise Plaza, remaining Escrow Funds shall be returned to
Developer,
3. South Pointe Drive Prior to the issuance of a C.O. for Sub -Phase II(B), Developer shall
reconstruct South Pointe Drive to its condition before construction- pursuant to the
Development Agreement, from Ocean Drive east to Sunrise Plaza, including sidewalks
and median.
x
Mr. Ian -Bruce Eichner
March 11, 2008
Page 3 of 5
4., Beachwalk Easement Submittal of a perpetual easement for the Beachwalk along the
east side of the Continuum property, in a form and. substance as reasonably required by
the City Administration and City Attorney, which shall. occur prior to the issuance. of .a
C.O. for Sub -Phase II(B).
5. Engineering Calculations Prior to the issuance_ of a C.O. -for Sub -Phase II(B), Developer
shall demonstrate to the full satisfaction of the City Engineer, which shall not be
unreasonably withheld, that pursuant to the permit that was granted for Phase 1 of the
project, Developer has provided successful engineering measures to self contain all site
development runoff in accordance with all South Florida Water Management District
requirements for new construction, and that a zero net excess runoff will be discharged.
unto the City's collection system. Developer. must provide comprehensive plans and
calculations as well as as -built documentation, signed and sealed by a professional
engineer that fully supports information submitted and approved related to the. permit for
the driveway constructed as part of Phase 1.
6. Landscaping Completion .of. all site landscaping and other architectural elements in
accordance with the DRB Order and Developer's permitted set of construction
documents, to the satisfaction of the Planning Director. ;
r 7. Dismissal of Lawsuit with Prejudice Developer shall dismiss with prejudice that certain
lawsuit, styled South Beach Ocean Parcel 11, Ltd. v. City of Miami Beach, Florida, Case
No. 08 -10129 rCA 40, after the issuance of a C.O. for Sub -Phase II(A) and after the court
-approves the terms of. this Agreement, with each party to bear its own fees and costs.
The court shall retain jurisdiction to enforce the terms of this Agreement.
It is understood by Developer that- regulatory requirements that are specific to an individual sub -
phase or portion thereof will need to be fully addressed by that specific sub -phase or portion
thereof in order to receive a CO. It is understood by the City that with. respect to Sub -Phase
II(A), applicable regulatory requirements have been. addressed and that Sub -Phase II(A) shall
receive a CO by March 12, 2008.
Unless otherwise specifically set forth in this Agreement, the Development Agreement remains
in full- force and effect and the terms of the Development Agreement govern in the event that
either party breaches the terms this Agreement.
Please sign your acknowledgement and agreement below of the City's conditions for
an extension of time for performance.
` Sin rely,
Tim H mstreet,
Assistant City Manager
C'. Jorge M. Gonzalez, City Manager
Jose Smith, City Attorney
Joseph L. Rebak, Esq.
I have read this Letter Agreement and, fully understanding same, agree to be bound by
the terms and con itions contained herein. Facsimile copies of this Letter Agreement
shall be deemed tgr•n S.
South Beach c P City of Miami Beach
By: By
Ian Bruce Eichner Tim Hemstreet
Title: Assistant City Manager
Or
As Authorized Agent of
Ian Bruce Eichnerl South Beach
Ocean Parcel, Ltd.
- NOTARY ACKNOWLEDGEMENTS
STATE OF FLORIDA )
ss:
COUNTY OF MIAMI -DADS )
The foregoing instrument was acknowledged before me this day of F ry, 2008, by TIM
HEMSTREET, as Assistant City Manager of the City of Miami Beach, Florida a municipal corporation of.
the State of Florida, on behalf of such municipal corporation. He is ersonally kno o me or produced a
valid Florida driver's license identification.
My commission expires:
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The foregoing instrument was acknowledged before me this �� day of F5.br-c�ry, 2008, by
0 4 Zi ckrV -as e(A rfi� of South Beach Ocean Parcel _Ltd,- ,._a.for profit
corporation, on behalf of such corporation. He /she i personally kn n to me or
produced valid Florida driver's license as identification.
My commission expires:
•�;{, s^ J. FABNA 4LOCKMANN
MY COMMISSION # DD 473819 Cy .
EXPIRES; October 6, 2009
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March 11, 2008
Page 5 of 5
Exhibit B
Performance Milestone Timeline for Completion (all City Authorized Drawdown if
days are Calendar Days) Milestone is Missed
1. Developer to submit full 60 days from execution of this $15,000
a plication to FDEP Letter A reement.
2. Developer. to respond to 30 days from receipt of FDEP $15,000
FDEP comments and resubmit comments; or, if applicable, 30
to FDEP days from receiving comments
from CMB as necessa
3. Developer to submit for 20 days from receipt of FDEP $5,000
permit to * other applicable approval.
regulatory agencies.
4. Developer to respond to 30 days from receipt of $15,000
appropriate regulatory agency comments; or, if applicable,,30
comments. days from receiving comments
from CMB as necessary.
5. Developer to pull permits. 30. days from obtaining final $15,000
approvals.
6. Developer to commence 30 days from obtaining permits $50,000
construction, which shall be for the work.
confirmed by written notice to
City by Developer.
7. Developer to complete 270 days from construction $700,000
construction of Sunrise Plaza. commencement as specified
in written notice from
Developer for item 6 above.
Completion will be certified by
Developer's _ Engineer and
verified by City.
8. Developer to close out all 60 days from completion of $85,000
permits upon completion of work activities as determined
construction. by completion date certified
and verified in item 7 above.
Attachment B
~' IN THE CIRCUIT COURT OF THE
11 JUDICIAL CIRCM 3N AND FOR
MIAMI -DARE COUNTY, FLORA
SOUTH BEACH OCEAN PARCEL, 11, LTD., GENERAL JUITISL7IC7'ION DIVISION
a Florida limited partnership,
CASE NCB.: 08- 10129 CA 40
Plaintiff
vs.
CITY OF MIAMI BEACH, FLORMA,
a political subdivision of the State of Florida,
Defendant.
STIPIULATI N F ORDER O DIS IS r H P .pfJDY E
The Parties, by and through their undersigned counsel stipulate and agree as follows:
1. This cause has been amicably settled in accordance with the Settlement Agreement,
attached hereto as ]exhibit A. �
2. The "parties agree to be bound by and..perfbrin in accordance with the terms of the
Settlement A Bement and request that the Court reserve jurisdiction to enforce the terms of the
gr
Settlement Agreement,
3. This cause shall be voluntarily dismissed, with prejudice, with each party to bear its r
own fees and costs.
Dated this day of March, 2008
`Y'EW CARilENAS LLP RHONDA. MONTOYA HASAIrT, ESQ.
Counsel for Defendant
Counsel for Plaintiff �n City of Miami Beach
Four Seasons Tower, 15 Floor, City Attorney, y
1441 Brickeli Avenue 1700 Convention Center Drive, 4" FL
Zvliami, Flori da 33131 Miami Beach, FL 33139
Teleph e: (30 12 Tel 305) 673 -7470
F csi it ,X305) 3- 02
Facsimi (30 �.._.,
By.. By'
J eph ebak, onda Mo oya asan, Esq.
F a Bar No. 308668 Florida Bar No. 863890