Assignment and Assumption of Ground Lease 0016-a906g
ASSIGNMENT AND ASSUMPTION OF GROUND LEASE
RECORDING REQUESTED BY:
R. Davis Powell •
King& Spalding LLP
1185 Avenue of the Americas
New York,New York 10036
WHEN RECORDED
RETURN TO:
Mayer Brown LLP
214 North Tryon Street, Suite 3800
Charlotte,North Carolina 28202
Attn: David B.H. Saye, Esq.
[Space Above for Recorder]
ASSIGNMENT AND ASSUMPTION OF GROUND LEASE
(1691 MICHIGAN AVENUE)
THIS ASSIGNMENT AND ASSUMPTION OF GROUND LEASE (this "Agreement") is
made and entered into as of April 9 , 2016 (the "Effective Date"), by and between 1691 MICHIGAN
AVE INVESTMENT LP, a Delaware limited partnership ("Assignor"), whose address is c/o American
Fund US Investments LP, c/o HQ Capital Real Estate L.P., 114 West 47`1' Street, 23rd Floor, New York,
NY 10036-1508 and CLPF — LINCOLN, LLC, a Delaware limited liability company ("Assignee"),
whose address is c/o Clarion Partners, LLC, 1440 New York Avenue, NW, Suite 200, Washington, DC
20005. All initial capitalized terms used but not otherwise defined herein shall have the respective
meanings given to them in the Purchase Agreement(as hereinafter defined).
RECITALS
A. Assignor and Assignee have entered into that certain Purchase and Sale
Agreement dated as of November 10, 2015 (as amended, the "Purchase Agreement"), pursuant to
which, among other things, Assignor has agreed to sell, assign, transfer, convey and deliver to
Assignee, and Assignee has agreed to purchase and accept from Assignor, all right, title and
interest of Assignor in that certain Ground Lease (as defined below) with respect to the real
property located at 1691 Michigan Avenue, Miami Beach, Florida, as legally described on
Exhibit A attached hereto and by this reference made a part hereof(the "Property").
B. Pursuant to the Purchase Agreement, Assignor has agreed to assign to Assignee
all of Assignor's right, title and interest in and to all of the Assignor's leasehold estate under that
certain Lease by and between City of Miami Beach, Florida a municipal corporation, as
Owner/Landlord, and Lincoln Plaza Partners, LLC, a Florida limited liability company, as
Tenant, dated September 1, 1999; as memorialized by that certain Agreement of Lease dated
September 1, 1999 and recorded September 3, 1999 in the Public Records of Miami-Dade
County, Florida (the "Official Records") Book 18770, Page 447; as assigned by Tenant to LNR
DMSLIBRARYO I:27898160.6
Jefferson, LLC, a Florida limited liability company ("LNR"), in that certain Assignment and
Assumption Agreement recorded June 5, 2001 in Official Records Book 19700, Page 3095; as
consented to in that certain Consent to Assignment and Assumption by City of Miami Beach
Florida recorded May 17, 2001 in Official Records Book 19669, Page 1035; as assigned by LNR
to Assignor (formerly known as Lincoln Miami Beach Investments, LLC, a Delaware limited
liability company) in that certain Assignment and Assumption of Ground Lease recorded July
20, 2006 in Official Records Book 24738, Page 4073 (collectively, and as heretofore modified,
extended, renewed or replaced, the "Ground Lease"), in each case with respect to the Property,
and Assignee has agreed to assume such Ground Lease, as more particularly set forth below.
NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter
set forth and set forth in the Purchase Agreement and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be
legally bound, subject to the terms and conditions set forth herein and in the Purchase
Agreement, hereby agree as follows:
1. Assignment. Upon the terms and subject to the conditions of the Purchase Agreement,
and in reliance upon the representations, warranties, covenants and agreements set forth therein,
effective as of the Effective Date, Assignor hereby sells, assigns, transfers, sets over and delivers
unto Assignee, as lessee, all of Assignor's right, title and interest in and to all of the Assignor's
leasehold estate and interest under the Ground Lease, together with all the right, title, interest and
estate of Assignor in and to the Property and premises demised by and described in the Ground
Lease, and all improvements and appurtenances situated on or used, occupied and enjoyed in
connection with the Ground Lease and the land thereby demised, and all other rights of the
Assignor under the Ground Lease ("Sale").
2. Representations, Warranties and Covenants. Assignor represents and warrants to
Assignee that Assignor is the owner of the leasehold estate under the Ground Lease (the
"Leasehold Estate") and other interests being assigned hereby, and that such Leasehold Estate
and other interests are free and clear of all liens, charges and encumbrances other than the
Ground Lease, the Leases (as defined in the Purchase Agreement) and those items listed in
Exhibit B attached hereto and incorporated herein by this reference (the "Permitted Exceptions"),
and subject to the Permitted Exceptions, Assignor will warrant and defend title to the Leasehold
Estate unto Assignee, its successors and assigns, against any person or entity asserting any
adverse claim by, through or under Assignor, but against none other.
3. Assumption. Assignee hereby accepts the assignment of the Ground Lease, and hereby
assumes and agrees to perform all of the duties and obligations of Assignor under the Ground
Lease, and further agrees to be liable and subject to all conditions and restrictions to which
Assignor is subject to under said Ground Lease.
4. Survival. The provisions of this Agreement shall survive the Closing.
5. Further Assurances. Assignor and Assignee hereby agree and covenant that they will, at
any time and from time to time after the date hereof, upon the reasonable request of the other
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party hereto, execute and deliver such further instruments or documents of assignment,
conveyance and transfer as may be reasonably necessary to implement and effect the assignment
and assumption of the Ground Lease contemplated by this Agreement and the Purchase
Agreement.
6. City's Required Consents.
(a) Rejection of Right of First Offer. On January 13, 2016, the Mayor and City Commission
adopted City Resolution No. 2016-29268, attached hereto and made a part hereof as
Exhibit C, whereby the Mayor and City Commission authorized the City Manager to
decline, in writing, the Right of First Offer Transaction, as required pursuant to Section
36.2 of the Ground Lease, and as further evidenced by the City Manager's letter, attached
hereto and made a part hereof as Exhibit D.
(b) Consent to Sale to Assignee. Additionally, on January 13, 2016, pursuant to Resolution No.
2016-29268, the Mayor and City Commission also approved the Sale, subject to and
conditioned upon the City's successful completion of its evaluation of Assignee, in
accordance with Article 10 of the Ground Lease (the "City's Due Diligence"); and
payment to the City of its reasonable costs incurred in connection with the Sale including,
without limitation, reimbursement of the City's Due Diligence costs. The City's consent
to the Sale shall not be deemed a consent to any subsequent assignment or subletting, nor
shall it be deemed or construed to be a waiver of any of the restrictions or limitations on
assignment and subletting set forth in the Ground Lease.
7. Miscellaneous.
(a) This Agreement may not be amended or modified other than by an instrument in writing
signed by Assignor and Assignee and only if consented to by Owner.
(b) This Agreement shall be binding upon and inure solely to the benefit of the parties hereto and
their respective successors and permitted assigns, and nothing herein, expressed or
implied, shall give or be construed to give any person or entity, other than the parties
hereto and such successors and assigns, any legal or equitable rights hereunder.
(c) This Agreement shall be governed by, and construed in accordance with, the laws of the
State of Florida without giving effect to the choice of law principles thereof, including all
matters of construction, validity and performance.
(d) For the convenience of the parties hereto, this Agreement may be executed in any number of
counterparts, each such counterpart being deemed an original, and all such counterparts
shall together constitute the same agreement.
[REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed effective as of the date first above written.
Signed,sealed and delivered ASSIGNOR:
in the presence of:
1691 MICHIGAN AVE INVESTMENT LP,
a Delaware limited partnership
Name[Print]: '4i n By: 1691 Michigan Ave Investment GP LLC,
a Delaware limited liability company,
its general partner
I_41111114. /
Name 'tint]: - • ' 1 "L. By:
y.
Name: ffyi1. rv��fr.
Title: o9,,. ,Vitro✓-Am./ -wa P., A `
STATE OF N tt) V.WVI )
) ss:
COUNTY OF JNe,t.) YOirl )
The foregoing instrument was acknowledged before me this i2`h day of Fl y I, ji , 2016 by
2 eph S . �rufob,.T,r , as Maiming ing IWediy of 1691 Michigan Ave investment
GP LLC, a Delaware limited liability cmpany, as general partner of 1691 Michigan Ave
Investment LP, a Delaware limited partnership, on behalf of such limited liability company on
behalf of such limited partnership. He/She is personally known to me or has produced
as identification.
0440,_
Print Name: iQ ri ne.- ` Q(d
y
[NOTARIAL SEAL]
J
,-DAPHNE V. HARDY
Notary Public, State of WY\
Notary PIblic,State of New York
,Registration #01HA6137419 My commission expires: Ojag/01Of�y
/
Qualified'In New York County
Commission Expires-December 28,2017
Serial No., if any:
[Assignment and Assumption of Ground Lease]
Signed,sealed and delivered ASSIGNEE:
in the presence of:
CLPF—LINCOLN, LLC,
tif‘ItIL(T>21RrII1r. a Delaware limited liability company
i M
Name [Print]: ,rc i( Gteih
By:
N. e: ?,G&,Yr p YY Ma a II C,f/ln.S
itle: ix rutpr 1 'Prv1/4 .S J it-0,tall
Name [Pri 6-3 Vi
sw,E-or 0 ouht' ,,,,*
ss:
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The foregoing instrument was acknowledged before me this ` day of flion @ , 2016,
by i 1,,I , ',I ,, Ai;,'as- ' 0( yiotefof CLPF — Lincoln, LLC, a Delaware limited
liability company, on behalf of such limited liability company. He/She is personally known to
me or has produced as identification. `
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40f- . � u a,, Print Name: C
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411,:',74i: :�_ a ' : ►+= Notary Public, State of d tbvi 1• •
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[Assignment and Assumption of Ground Lease]
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CITY'S ACKNOWLEDGEMENT, CONSENT, AND AGREEMENT AS TO ARTICLE 6
ONLY:
CITY/OWNER:
I
City of Mi i Beach, Flori•r:
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By. --- -'
Name: Jimoy L. Morales .
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Title: City •anager
By: , _..„..„``` „�1 ale.
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Name: Rafael Gr ai�•''. �N., , A.
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Title: City Cler ,, _
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STATE OF FLORIDA) iy�'9,t�j'' ''�• "\ ,'/
COUNTY OF MIAMI-DADE) 14 CH `Z0
On AQL k44 n, 2016 before e, the undersigned Notary Public, in and for the State aforesad, me,
personally appeared Jimmy L. Morales, as the City Mana g er for the City of Miami
Beach, Florida, and Rafael Granado, as the City Clerk of the City of Miami Beach, Florida, in
the capacity aforestated. They are personally known to me or have produced a valid Florida
driver's license as identification.
,a�FSr.?y .,, FERNANDASILVA , Cs,' /"Al\';d0 _rej-jZ
�:� �t MY COMMISSION#FF 155332 Notary Public
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oP' Bonded Thru Notary Public Underwriters 1 4 g
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[Notary Public Seal]
[Assignment and Assumption of Ground Lease]
APPROVED AS TO
FORM&LANGUAGE
&FOR EXECUTION
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City Atto .y t • f Date
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Exhibit A to Assignment and Assumption of Ground Lease
Legal Description of the Property
Lessee's interest in that certain Lease by and between the City of Miami Beach, Florida, a municipal
corporation, as Owner/Landlord, and Lincoln Plaza Partners, LLC, a Florida limited liability company, as
Tenant, dated September 1, 1999, and memorialized by that certain Agreement of Lease dated September
_1, 1999, and recorded September 3, 1999,_in Official_Records_B_ook_18_7_7_0,_Page 447; as,assigned_
pursuant to assignment of Tenant's interest to LNR Jefferson, LLC, a Florida limited liability company, in
that certain Assignment and Assumption Agreement, recorded June 5, 2001, in Official Records Book
19700, Page 3095; Consent to Assignment and Assumption by the City of Miami Beach Florida, recorded
May 17, 2001, in Official Records Book 19669, Page 1035, and Assignment and Assumption of Ground
Lease to Lincoln Miami Beach Investments, LLC, a Delaware limited liability company, now known as 1691
MICHIGAN AVE INVESTMENTS LP, a Delaware limited partnership, recorded July 20, 2006, in Official
Records Book 24738, Page 4073, of the Public Records of Miami-Dade County, Florida, demising the
following described land:
Lots 7 through 10, inclusive, and Lots 14 through 20, Inclusive, in Block 37, PALM VIEW SUBDIVISION,
according to the plat thereof, as recorded in Plat Book 6, Page 29, of the Public Records of Miami-Dade
County, Florida, less and except the Improvements located thereon.
TOGETHER WITH
FEE SIMPLE ESTATE:
The Improvements located on Lots 7 through 10, inclusive, and Lots 14 through 20, inclusive, in Block 37,
PALM VIEW SUBDIVISION, according to the plat thereof, as recorded in Plat Book 6, Page 29, of the Public
Records of Miami-Dade County, Florida.
Exhibit B to Assignment and Assumption of Ground Lease
Permitted Exceptions
._
1. Taxes and assessments for the year 2016 and subsequent years,which_arenot yet due and
payable.
2. Local, state and federal laws, ordinances or governmental regulations, including but not
limited to, building, zoning and land use laws, ordinances and regulations, now or
hereafter in effect relating to the Property,
3. Matters shown on that certain ALTA/ACSM Land Title Survey prepared by Bock &
Clark and bearing the certification of Mark G. Leist, Registered Surveyor No. 5836,
dated October 26, 2015, last revised February 4, 2016.
4. [Certain Notices of commencement filed in connection with Seller's work for tenant
improvements at the Property to be agreed upon by the parties prior to Closing].
5. Restrictions, covenants, conditions, easements, dedications and all other matters as
contained on the Plat of PALM VIEW SUBDIVISION, recorded in Plat Book 6, Page 29,
of the Public Records of Miami-Dade County, Florida.
6. Terms, conditions and provisions of the Agreement of Lease between City of Miami
Beach, Florida, a municipal corporation, Owner/Landlord, and Lincoln Plaza Partners,
LLC, a Florida limited liability company, Tenant, dated September 1, 1999, and recorded
September 3, 1999, in Official Records Book 18770', Page 447; as assigned pursuant to
assignment of Tenant's interest to LNR Jefferson, LLC, a Florida limited liability
company, in that certain Assignment and Assumption Agreement, recorded June 5, 2001,
in Official Records Book 19700, Page 3095; Consent to Assignment and Assumption by
the City of Miami Beach Florida, recorded May 17, 2001, in Official Records Book
19669, Page 1035, and Assignment and Assumption of Ground Lease to Lincoln Miami
Beach Investments, LLC, a Delaware limited liability company, now known as 1691
MICHIGAN AVE INVESTMENTS LP, a Delaware limited partnership, recorded July
20, 2006, in Official Records Book 24738, Page 4073, aforesaid records.
7. Notice of Landlord recorded June 3, 2003, in Official Records Book 20434, Page 1620,
and recorded August 15, 2003, in Official Records Book 20597, Page 4698, aforesaid
records.
8. Utility Easement in favor of the Florida Power& Light Company, recorded in Official
Records Book 20947, Page 1744, aforesaid records, as shown on that certain
ALTA/ACSM Land Title Survey prepared by Bock & Clark and bearing the certification
of Mark G. Leist, Registered Surveyor No. 5836, dated October 26, 2015, last revised
February 4, 2016.
9. Order granting variance by Board of Adjustment of the City of Miami Beach, Florida
recorded July 28, 2003, in Official Records Book 21462, Page 349, aforesaid records.
10. Order granting variance by the Board of Adjustment of the City of Miami Beach, Florida,
recorded March 8, 2006, in Official Records Book 24299, Page 3554, aforesaid records.
11. Order granting variance by Board of Adjustment of the City of Miami Beach, Florida,
recorded March 5, 2012, in Official Records Book 28020, Page 130, aforesaid records.
12. Order of the City of Miami Beach Design Review Board recorded April 2, 2013 in
Official Records Book 28560, Page 1500, aforesaid records, as modified by Order of the
City of Miami Beach Design Review Board recorded July 2, 2014 in Official Records
Book 29214, page 4180.
13. Order of the City of Miami Beach Design Review Board recorded July 2, 2014 in Official
Records Book 29214, Page 4180, aforesaid records.
14. Terms, covenants, conditions and other matters contained in any unrecorded Lease(s) and
all rights thereunder of the Lessee(s) and of any person claiming by,through or under the
- Lessee(s)-as-set forth in the Purchase Agreement. —- — - - - - -15. Order of the City of Miami Beach Design Review Board recorded October 9, 2015 in
Official Records Book 29810, Page 1981, aforesaid records.
Exhibit C to Assignment and Assumption of Ground Lease
City Resolution No. 2016-29268
[See attached]
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RESOLUTION NO. 2016-29268
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF I
MIAMI BEACH, FLORIDA AUTHORIZING THE CITY MANAGER TO DECLINE, IN
WRITING, THE OWNER'S RECIPROCAL RIGHT OF FIRST REFUSAL, AS
---- - -- - --RE Q.UIRED P�I-RS-UANT_TO THE TERMS-OF SECTION 36.2 OF THE
AGREEMENT OF LEASE ("GROUND LEASE") BETWEEN- THE CITY
("OWNER") AND 1691 MICHIGAN AVE.INVESTMENTS LP ("TENANT"), DATED
AS OF SEPTEMBER 1, 1999, INVOLVING THE IMPROVEMENTS TO THE
PROPERTY ("PROJECT") LOCATED AT 1691 MICHIGAN AVENUE, MIAMI
BEACH, FLORIDA; AND FURTHER APPROVING TENANT'S SALE OF THE
PROJECT TO CLPF - LINCOLN, LLC, A DELAWARE LIMITED LIABILITY
COMPANY ("PROPOSED PURCHASER"), SUBJECT TO THE
ADMINISTRATION'S SUCCESSFUL COMPLETION OF ITS EVALUATION OF
THE PROPOSED PURCHASER IN ACCORDANCE WITH ARTICLE 10 OF THE
LEASE ("CITY'S DUE DILIGENCE"), AND PAYMENT TO THE CITY OF ITS
REASONABLE COSTS INCURRED IN CONNECTION WITH THE PROPOSED
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SALE INCLUDING, WITHOUT LIMITATION, REIMBURSEMENT OF THE CITY'S ,j
DUE DILIGENCE COSTS; AND FURTHER AUTHORIZING THE CITY MANAGER
AND CITY CLERK TO EXECUTE ANY AND ALL CLOSING DOCUMENTS ON
BEHALF OF THE CITY.
1 WHEREAS, On January 5, 1998, the City issued RFP No. 20-97/98, seeking
proposals for the development of Public-Private Parking facilities (the "RFP"). On April 6,
1998, proposals from five (5) different development teams were submitted and evaluated
by an Evaluation Committee, and on July 15, 1998, the City Commission authorized
negotiations with four(4) of the proposed development projects; and
WHEREAS, As a result of said negotiations, on July 7, 1999, the Mayor and City
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Commission adopted Resolution No. 99-23236 approving the Agreement of Lease and
the Development Agreement between the City of Miami Beach and Lincoln Plaza Partners
LLC, for the development of a mix-use project, located at Michigan and Jefferson Avenues
between Lincoln Lane and 17th Street (the "Land"); and
WHEREAS, An Agreement of Lease was executed between the City of Miami Beach and
Lincoln Plaza Partners LLC, dated as of September 1, 1999 ("Ground Lease"), in connection with
the lease of the Land where Tenant agreed to develop a commercial project, consisting of an
office building, a parking garage, and ground floor retail space (collectively the "Project"), and j
which Project is currently located at 1691 Michigan Avenue; and
WHEREAS, On December 20, 2000, the Mayor and City commission adopted a
Resolution No. 2000-24220, modifying the terms of the Lease by waiving the provisions of
Section 10.3(a) and amending Section 10.4, approving the sale and Assignment and
Assumption of the Ground Lease from Lincoln Plaza Partners LLC to LNR Jefferson LLC i
before a certificate of occupancy had been obtained; and
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WHEREAS, On October 5, 2005, LNR Jefferson LLC changed its name to The
Lincoln, LLC; and
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WHEREAS, On or about July 18, 2006, The Lincoln LLC sold its interest in the
Project and assigned its leasehold interest in the Land to Lincoln Miami Beach Investment
LLC, a Delaware limited liability company, pursuant to that certain Assignment and
Assumption of Ground Lease recorded in O.R. Book, 24738, Page 4073, of the Public
Records of Miami-Dade County, Florida; and
WHEREAS, On November 17, 2006, Lincoln Miami Beach Investment LLC
changed its name to 01K Lincoln Miami Beach Investment LLC, and thereafter, on June
17, 2009, merged with 1691 Michigan Ave Investment LP, a Delaware limited liability
partnership ("Tenant"); and
WHEREAS, On February 12, 2014, the Mayor and City Commission approved
Resolution No. 2014-28486 authorizing the Mayor and City Clerk to execute Amendment
No. 1 to the Ground Lease by and between the City of Miami Beach and Tenant,
modifying the Scope of Use under the Ground Lease by reducing the minimum number of l
parking spaces required for the Garage Facility, from 700 to 645 spaces, increasing the
minimum number of parking spaces required to be maintained at all times for use by the
general public from 100 to 155 parking spaces, and further increasing the monthly parking J
spaces for members of the general public from 50 to 75, in connection with the
development of a miniature golf project, at the sixth floor of the garage with the subtenant,
City Middle, LLC; and
WHEREAS, City.Middle, LLC has experienced delays in developing the miniature
golf project and to date Amendment No. 1 has not been executed; and
WHEREAS, Pursuant to Section 10.5 of the Ground Lease ("Required Notices"), a
proposed transfer and/or sale of the Project requires written notice to the Owner, with the
identity of the transferor, transferee, nature of the transaction, percentage of interest
conveyed and such other information requested by Owner ("Notice of Sale"). On
November 10, 2015, Tenant provided Owner with a Notice of Sale that Tenant intended to i
sell 100% of its leasehold interest in the Project ("Sale")as follows: -`j
Owner of Ground Lease: City of Miami Beach 1
Seller: 1691 Michigan Ave Investment LP
Proposed Purchaser: CLPF—Lincoln, LLC,
a Delaware limited liability company
Purchase Price: $109,250,000 cash transaction; and
WHEREAS, pursuant to Section 26.2(c)(iii) of the Lease, the City has until January
9, 2016, in which to approve or disapprove of the Sale of the Project to the Proposed
Purchaser; and
WHEREAS, in accordance with Section 36.2 of the Lease, "Owner's Reciprocal
Right of First Refusal", the City also has the right to elect, in writing, whether to
consummate the Right of First Offer Transaction, at the same price and upon such other
material terms set forth in the Offer Notice ("Offer"); the City has until December 25, 2015
to exercise this Right of First Refusal; and 1
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WHEREAS, after considering the revenue figures from surrounding City-owned
and managed parking garages, which have a longstanding position of keeping the parking
rates below market for the benefit of its residents and visitors (as compared to the Project
which is a privately managed garage), and estimated Project revenues, City Staff
garage, P � Y 9 j tY
d_ete.rmined_that—th_e_Project_would_run_an_annual_deficit_o_f_appr_oximately$925,043, __ ___/I
without taking into consideration payment of principal, capital improvements, and other
additional costs the Project; and
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WHEREAS, considering that the Offer materially exceeds the cost to construct a
City-owned parking, office, and retail facility and that the Project will revert back to the City
at the end of the Lease term, the Administration recommends that the City decline the
Reciprocal Right of First Offer Transaction; and '
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WHEREAS, the Administration further recommends that the City Commission 4
approve the sale of the Project to the Proposed Purchaser, CLPF—Lincoln, LLC, subject,to
City staff's successful completion of the City's Due Diligence, Tenant's payment of the 1
City's Due Diligence costs, and execution of all required closing documents.
"
NOW, THEREFORE, BE IT DULY RESOLVED THAT THE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, hereby authorize the City Manager
to decline, in writing, the Owner's Reciprocal Right of First Refusal, as required pursuant to the
terms of Section 36.2 of the Ground Lease; and further approve Tenant's sale of the Project to the
Proposed Purchaser, CLPF — Lincoln, LLC, a Delaware limited liability company, subject to and
conditioned upon the Administration's successful completion of its evaluation of the Proposed
Purchaser in accordance with Article 10 of the Ground Lease (the "City's Due Diligence"), and a
payment to the City of its reasonable costs incurred in connection with the proposed sale including,
without limitation, reimbursement of the City's Due Diligence costs; and further authorize the City
Manager and City Clerk to execute any and all closing documents on behalf of the City.
PASSED and ADOPTED this /3 day of J @1t(4r y 2015.
ATTEST: / 'r, s
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Rafa I E. Granado, Cl S!.,:+ -+.�',,� Irai? Philip .=vi ,;��. • ,FOR, r;•,,.",-; ., 1
T:IAGENDA120151Decem,,�,, ):►11891 pit Jell nCV•X1.Michigan Said RE_ O 12,e 15 5JJ •c' /� 1\., , , , . ,.,. -... *% .� h/y_ 4 11f
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x;:.? c--.'• \ h. N . }APPROVED AS TO
V. W '�" �� `r. 'lli" - , . FORM.& LANGUAGE
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pi._ ... „,t.„,c,_....City Attorney ,, Dote
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01 Be.
STATE OF FLORIDA �''
COUNTY OF MIAMI-DADE
I, RAFAEL E.GRANADO,City Clerk of City of [1* ,
Miami Beach, Florida,do hereby certify that '- :INCORP ORATED:
the above and foregoing is a true and correct
thereof on file in this `�` •'�
cony of the original th �,-SI ' -_-_� , •''p�
olf;ce. rl' - Y
WITNES my hand and/the seal of said City
this a f day of ►v A.D., 20
RAFAEL E.GRANADO
City Clerk of he City Miami Beach, Florida
Exhibit D to Assignment and Assumption of Ground Lease
City Manager's Letter Declining the Right of First Offer under the Ground Lease
[See attached]
A A \ tVA\ B E A C
\ H
City of Miami Beach, 1700 Convention Cen ei Drl`-e, tv1:cmi :each. Florida 33139 www.rnio'rnibeccnfl.gov
rricr?'.:beccnfi.aov
Jimmy L. Morales, City Manager
Tel: 305-673-70W,0, Fax: 305-673-7782
January 14, 2016
1691 Michigan Avenue Investment, LP
do American Fund US Investments LP
c/o HQ Capital Real Estate LP
114 West 47th Street, 23rd Floor
New York, NY 10036-1508
Attention: Andre Kinney, andre.kinney(c�hgcapital.com
King & Spalding LLP
1180 Peachtree Street, NE
Atlanta, Georgia 30309-3521
King & Spalding, LLP
1185 Avenue of the Americas
New York; NY 10036
Attention: R. Davis Powell, dpowell(akslaw.com
Re: Lease Agreement, (as amended and assigned, the "Ground Lease"),
dated September 1, 1999, by and between the Owner, City of Miami
Beach, Florida ("City"), and 1691 Michigan Ave Investment, LP, a
Delaware limited partnership (successor in interest to Lincoln Plaza
Partners, LLC) ("Tenant"), with respect to the property located at 1691
Michigan Avenue, Miami Beach, Florida (the"Premises").
Dear Mr. Kinney:
This letter responds to Tenant's notices dated November 9, 2015 and November 10,
2015, attached hereto.'
As set forth in the attached documents, and subject to Tenant's continued compliance
with the terms of the Lease, the City has countersigned the Tenant's notices, pursuant to
a Resolution approved by the City Commission on January 13, 2016 (Agenda Item R7I).
By separate cover, the City will prepare and circulate a proposed Ground Lease
Estoppel and its form Assignment and Assumption of Ground Lease, for the parties'
review.
' On or about December 16, 2015, Tenant's counsel, Monica Entin, Esq. confirmed Tenant's
agreement to provide the City with an extension of time, through January 14, 2016, to respond to
the Tenant's November 9,2015 and November 10, 2015 notices.
Letter to A. Kinney
1691 Michigan Ave Investment, LP
January 14, 2016
Page 2
Please contact Mark Milisits at(305) 673-7000, ext. 6443 at your earliest convenience to
coordinate an matters related to the closing, or if you have any questions.
Si,
1 cerely, ---- ---- -------
A1_
my L males ty Manager
cc: Max Sklar, Director for Tourism, Culture and Economic Development Department
Mark R. Milisits, RPA, Asset Manager, Office of Real Estate
Raul Aguila, City Attorney
,I
f
I
I
I
FAILURE TO RESPOND TO THIS REQUEST WITHIN THE TIME PERIOD PROVIDED IN
OF MIAMI BEACH, FLORIDA AND 1691
THE LEASE AGREEMENT' BETWEEN CITY i
MICHIGAN AVE INVESTMENT LP SHALL CONSTITUTE AUTOMATIC APPROVAL OF
THE MATTERS DESCRIBED HEREIN WITH RESPECT TO SECTION 36.2 OF SUCH
LEASE AGREEMENT.
November 9,2015
Sent Via UPS and Hand Delivery
i
City of Miami Beach ��
City Attorney �=
1700 Convention Center Drive �'
Miami Beach,Florida 33139
-
Pursuant to Section 36.2(a)and Exhibit 36.2(a)of the Lease,the terms of this Offer Notice are as follows:
I. Purchase Price,-$109,250,000.00
2. Closing Date—The closing of the purchase shall-take-place-on-a-date-designated-by—Tenant,-but in
sixty any event
not less than si (60) days nor more than ninety (90) days following the date such
Tenant executes a purchase agreement with the purchaser. If Landlord declines to be the purchaser
of this Right of First Offer Transaction,Tenant will likely consummate the sale to a third party at
an earlier date.
3. Deed;Title—At the closing,Tenant shall convey to the Purchaser(i)all of Tenant's right,
title and
interest in and to the Premises by a special warranty deed and (ii) all of Tenant's right, title and
interest in an to this Lease by an assignment of lease. The form of such deed and assignment of
lease shall be mutually acceptable to Tenant and Owner but shall not in any event provide for any
representations by Tenant other than a representation that Tenant has not theretofore transferred or
assigned the items being transferred or conveyed thereby and representations and warranties
customarily contained in a special warranty deed. Tenant's Interest in the Premises and the Lease
shall be conveyed to Owner subject to all liens encumbrances and other matters then affecting the
title thereto and any state of facts a survey may reveal (but in all cases subject to Tenant's
obligations under Section 2.2 of the Lease). Tenant shall also execute all other documents
customarily used in real estate transactions in Miami-Dade County,Florida.
4. Rent: Prorations —At the closing of the purchase, all Rental and/or Impositions shall be prorated
,
through the date of closing and paid by the party entitled thereto. If Landlord declines to be the
purchaser of this Right of First Offer Transaction, the expenses will be customarily prorated as in
other real estate transactions in Miami-Dade County, Florida, including buyer receiving a credit
with respect to Landlord's post-closing obligations under existing space leases for tenant
inducement costs.
5. Expenses— Each party shall pay its own attorneys' fees. All title charges,recording fees, survey
charges and other expenses incurred in connection with the purchase shall be paid by purchaser.
Tenant shall pay all documentary stamp taxes and surtax payable in connection with the purchase.
If Landlord declines to be the purchaser of this Right of First Offer Transaction, then in a sale
transaction to a third party purchaser,Tenant shall pay transfer tax,documentary stamp tax,Miami-
Dade County surtax, fees and premium for title insurance, the recording fees relating to any title
clearing documents necessary to consummate the sale, Tenant's attorneys' fees, any fees and
expenses required to be paid to Landlord for its consent and any brokerage commission due to the
broker used in the transaction.
If you have any questions or need additional information,feel free to contact us at HQ Capital Real Estate
L.P.
[Signature Page Attached]
Sincerely,
F691 Michigan Ave Investment-LP -
By: 1691 Michigan Ave Investment OP
By:
Name: aim li? r n
Title: Ao4k ate-►aG S 1 "..Ao ry
cc: Andres Kinney
Spencer McCann
Dave Powell
WITH A COPIES TO:
City of Miami Beach
City Attorney
1700 Convention Center Drive
Miami Beach,Florida 33139
City of Miami Beach
City Attorney
1700 Convention Center Drive
Miami Beach,Florida 33139
Bloom&Minsker
Suite 700
1401 Brickell Avenue
Miami,Florida 33131
Attention:Joel N.Minsker,P.A.
The City of Miami Beach,Florida does hereby elect NOT to consummate the Right of First Offer Transaction
set forth in this Offer Notice.
CITY OF 1 BEAC FLORIDA,
a municipal co ••ration of -e-State-of-Florida - !-
By:
Name: eww, L.. M a
Title: Lt it nc.y
FAILURE TO RESPOND TO THIS REQUEST WITHIN THE TIME PERIOD PROVIDED IN
THE LEASE AGREEMENT BETWEEN CITY OF MIAMI BEACH, FLORIDA AND 1691
MICHIGAN AVE INVESTMENT LP SHALL CONSTITUTE AUTOMATIC APPROVAL OF
THE MATTERS DESCRIBED HEREIN WITH RESPECT TO SECTION 10.3, 10.5 AND 10.6
OF SUCH-L-EASE-AGREEMENT.
November 10.2015
Sent Via UPS
City of Miami Beach
City Manager
1700 Convention Center Drive
Miami Beach,Florida 33139
City of Miami Beach r
r ..
City Attorney `:.
•1700 Convention Center Drive 7--
Beach,Florida 33139 `
rn
c o
Bloom& Minsker
Suite 700
1401 Brickell Avenue
Miami,Florida 33131
Attention:Joel N.Minsker,P.A.
•
Re: Lease Agreement (as previously assigned, the "Lease") between CITY OF MIAMI BEACH.
FLORIDA,a municipal corporation duly organized and existing under the laws of the State of Florida
('Landlord"), and 1691 Michigan Ave Investment LP, a Delaware limited partnership (successor in
interest to Lincoln Plaza Partners. LLC) ("Tenant"), dated September 1. 1999, with respect to the
property located at 1691 Michigan Avenue, Miami Beach, Florida(the"Premises'): capitalized terms
used but not otherwise defined herein have the meanings given such terms in the Lease. For reference
a copy of the Offer Notice is attached hereto as Exhibit A.
Dear Sir or Madam:
If Landlord declines to accept that certain Offer Notice sent by Tenant on November 9, 2015 pursuant to
Section 36.2(a) of the Lease, then Tenant hereby requests Landlord's consent to a proposed Sale of
Tenant's interest in the Lease pursuant to Sections 10.3(c) and 10.5(a) of the Lease. Please note the
following information about the potential third party purchaser of Tenant's interest in the Lease: (i) the
name of the proposed purchaser is CLPF - Lincoln. LLC. a Delaware limited liability company. and the
proposed purchaser's address is c/o Clarion Partners. LLC, 1440 New York Avenue NW. Suite 200.
Washington. D.C. 20005,(ii)the Tenant's name is 1691 Michigan Ave Investment, LP.a Delaware limited
partnership. and Tenant's address is c/o American Fund US Investments LP, c/o HQ Capital Real Estate
L.P., 114 West 47th Street, 23`d Floor, New York, New York 10036-1508,and (iii) the contemplated Sale
is for one hundred percent(100%)of the leasehold interest under the Lease.
•
The proposed purchaser is a subsidiary of Clarion Partners,a real estate investment management company
with approximately $36.8 billion in total assets under management (for more information, please see
www.clarionpartners.com). The proposed_purchaser hereby certifies that it is a Permitted Buyer pursuant
to Section 103(c) of the Lease. Pursuant to Section 103(cXA) of the Lease, attached please find the
financial statements of the proposed purchaser attached as Exhibit B (the "Financial Confidential
Information").
Please note, to facilitate Landlord's evaluation of the proposed purchaser, Clarion Partners is willing to
disclose to Landlord the Financial Confidential Information; provided, however, by accepting such
Financial Confidential Information,Landlord agrees:(i)except as required by applicable law,regulation or
legal process,to maintain in confidence and not disclose the Financial Confidential Information,or any part
thereof, to any third party other than to Landlord's representatives who have a need to know such
information (including, without limitation, its directors, employees, financial advisors, attorneys and
accountants)(collectively, "Representatives") it being understood such Representatives shall be informed
by Landlord of the confidential nature of such information and shall be directed by Landlord to treat such
information confidentially, (ii)to take the same measures to maintain the confidentiality of the Financial
Confidential Information as Landlord does with respect to its own proprietary and confidential information;
and(iii)not to use any Financial Confidential Information for any purpose other than to evaluate whether
or not to consent to the proposed Sale of Tenant's interest in the Lease. If the proposed Sale is not
consummated,or any time upon request of Clarion Partners for any reason,Landlord will return to Clarion
Partners or destroy all written Financial Confidential Information(except as may be required for regulatory
purposes).
Pursuant to Section 10.6(b) of the Lease, attached as Exhibit C hereto please find a proposed form of
Assignment and Assumption of Ground Lease (the "Assumption of Lease"). Please confirm the
Assumption of Lease is acceptable for the consummation of the Sale to the proposed purchaser.
In the event that Landlord consents to the proposed Sale of Tenant's interest in the Lease as described
above and approves the Assumption of Lease attached hereto, Tenant kindly requests that Landlord
promptly provide a written statement to Tenant of such consent and approval by countersigning in the
applicable signature block below.
If you have any questions or need additional information,feel free to contact us at HQ Capital Real Estate
L.P.
[Signature Page Attached]
Sincerely,
16911diichigan Ave Investment LP
By: 1691 • 'gin Ave Inv exit
By:,
Name: 2 rm..
Title: A R%,-.h 2'tit! S 7 i
cc: Andre Kinney
Spencer McCann
Dave Powell
WITH A COPIES TO:
City of Miami Beach CLPF—Lincoln,LLC
City Manager
c/o Clarion Partners,LLC
1700 Convention Center Drive 1440 New York Avenue NW
Miami Beech,Florida 33139 Suite 200
Washington,DC 20005
Attention: Barron Williams
City of Miami Beach Mayer Brown 11.2
City Attorney 214 North Tryon Street
1700 Convention Center Drive Suite 3800
Miami Beach,Florida 33139 Char ,NC 28202
Attention: David B.IL Saye
Bloom&Mineker
Suite 700
1401 Brickell Avenue
Miami,Florida 33131
Attention:Joel N.Minster,PA.
The undersigned hereby certifies to Landlord that it is a Permitted Buyer pursuant to Section 10.3(c)of the
Lease.
CLPF—LINCOLN,-LLC,
a Delaware limited liability company
By:
Name:Barron Witham
Title: Diredor
The City of Miami Beach,Florida does hereby consent to the proposed Sale of Tenant's interest in the Lease
as described abov
crry OF r BEACH,— OVA,
a municipal co ration of th, State of Florida
By: f
Y:
Name: 3,es.•Y.1 L. "kVej
Title: L‘ no�{
1