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2017-29823 Reso
2017-29823 RESOLUTION NO. A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, ACCEPTING THE RECOMMENDATIONS OF THE FINANCE AND CITYWIDE PROJECTS COMMITTEE WITH RESPECT TO CERTAIN ELEMENTS PERTAINING TO THE DEVELOPMENT OF THE BARCLAY PLAZA BUILDING, LOCATED AT 1940 PARK AVENUE, AS A WORKFORCE HOUSING PROJECT ("PROJECT"), INCLUDING INCOME LIMITS, EMPLOYMENT TENURE, INCLUSION OF POOL AREA AND PARKING LOT, AND CONSIDERATION OF A COMMERCIAL COMPONENT FOR THE PROJECT; AND PROVIDING THAT THE ISSUANCE OF A REQUEST FOR PROPOSALS FOR THE DEVELOPMENT OF THE PROJECT, INCORPORATING THE ELEMENTS APPROVED HEREIN, SHALL BE SUBJECT TO THE ADVANCE APPROVAL OF THE MAYOR AND CITY COMMISSION. WHEREAS, at its January 25, 2017 Workforce/Affordable Housing Workshop, the City Commission was presented with a variety of issues associated with the proposed Barclay Plaza Apartments workforce housing project (the "Project"), which resulted in referrals to several Commission Committees for further review and direction; and WHEREAS, on March 31, 2017, the Finance and Citywide Projects Committee provided direction on the following specific areas impacting the development of the Project, each of which will be incorporated into the request for proposals for the Project: (1) income limits; (2) employment tenure, (3) inclusion of the pool area and parking lot in the development, and (4) addition of a commercial accessory and unit compositions; and WHEREAS, the Committee recommended that the income limits be increased, to accommodate households earning up to 140% Area Median Income (AMI), and thereby ensure the broadest inclusion of municipal workers as possible; and WHEREAS, the Committee further recommended that a two-year employment tenure be the minimum threshold for eligibility of tenants served by the Project; and WHEREAS, the Committee further recommended that the parking lot and existing pool at Barclay Plaza be considered for inclusion in the development area for the Project, to maximize the number of units that can be developed for workforce housing purposes; and WHEREAS, the Committee further recommended, as a potential option for the Project, consideration of any proposed commercial component or accessory use, subject to prior review and approval by the City. 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 accept the recommendations of the Finance and Citywide Projects Committee, with respect to certain elements pertaining to the development of the Barclay Plaza building, located at 1940 Park Avenue, as a workforce housing project ("Project"), including income limits, employment tenure, inclusion of pool area and parking lot, and consideration of a commercial component for the Project; and provide that the issuance of a request for proposals for the development of the Project, incorporating the elements approved herein, shall be subject to the advance approval of the Mayor and City Commission. PASSED AND ADOPTED this a, day of April, 2017. Aellir Phil'., Lev''.- i'ayor ATTEST: Rafael E. G an 'ado, City ,, \ BE-Al u.�I f i i ORATED: 0 APPROVED AS TO P INCCR :' FORM&LANGUAGE S 17%,% ':\ -- •••• ©) y &FOR EXECUTION City Attorneyr 121ov Date Resolutions -C7 X MIAMI BEACH COMMISSION MEMORANDUM TO: Honorable Mayor and Members of the City Commission FROM: Jimmy L. Morales, City Manager DATE: April 26, 2017 SUBJECT:A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, ACCEPTING THE RECOMMENDATIONS OF THE FINANCE AND CITYWIDE PROJECTS COMMITTEE WITH RESPECT TO CERTAIN ELEMENTS PERTAINING TO THE DEVELOPMENT OF THE BARCLAY PLAZA BUILDING, LOCATED AT 1940 PARK AVENUE, AS A WORKFORCE HOUSING PROJECT ("PROJECT"), INCLUDING INCOME LIMITS, EMPLOYMENT TENURE, INCLUSION OF POOL AREA AND PARKING LOT, AND CONSIDERATION OF A COMMERCIAL COMPONENT FOR THE PROJECT; AND PROVIDING THAT THE ISSUANCE OF A REQUEST FOR PROPOSALS FOR THE DEVELOPMENT OF THE PROJECT, INCORPORATING THE ELEMENTS APPROVED HEREIN, SHALL BE SUBJECT TO THE ADVANCE APPROVAL OF THE MAYOR AND CITY COMMISSION. RECOMMENDATION Adopt the Finance and Citywide Projects Committee(the Committee) recommendations: • the income limits be adjusted to households earning up to 140% AMI to ensure the broadest inclusion possible. • a two-year employment tenure should be the threshold for consideration for tenants targeted by this project. • consider the parking lot and existing pool are for development to maximize the number of units that can be developed. Commissioner Malakoff further noted that as many amenities as possible be considered including the possibility of a pool in the accessory building. The Committee requested additional analysis regarding rent levels, unit nix and potential commercial components of the development, and potential inclusion of a pool in a new accessory building. BACKGROUND At its January 25, 2017 Workforce/Affordable Housing Workshop, the City Commission was presented with a variety of issues associated with the Barclay Plaza Apartments workforce housing project that required greater Commission direction in order to prepare the development Request For Proposals (RFP). As a reminder, the City has retained Concourse Group as its Public/Private Partnership (P3) consultant. Concourse Group is currently undertaking a financial analysis of the Page 743 of 1596 site in anticipation of the RFP process. The Barclay Plaza Apartments property is located on a unique lot which is fronted by Park Avenue on the east and Washington Avenue on the west. The property is comprised of the historic, 66-unit main building built in 1935 that rests on the east side of the property facing the historic district. To the west of the building, lies a pool and parking lot which face the Convention Center on Washington Avenue. The lot size is approximately 26,250 square feet. ANALYSIS The Commission has already earmarked this property for the development of workforce housing serving persons employed in the education, public safety and municipal fields earning 120 to 140 percent Area Media Income (AMI). The Neighborhoods/Community Affairs Committee is also considering whether the units should be offered to individuals with ties to the City(e.g. grew up here, resided here formerly, has family currently residing in the City). This income range varies from $59,640 to $69,580 for a household of one. However, this leaves a gap of individuals earning between 80 and 120 percent AMI who are not eligible for traditional affordable housing (subsidized by federal or state funding)and those that would be served by the City. Housing affordability is generally defined as housing costing no more than 30 percent of a household's income -- this is true for eligibility in state or federally subsidized housing or when applying for a private mortgage. The restoration of the existing building will be extensive as the building has been poorly maintained, is not compliant with its 40-year recertification and suffered a fire in its historic lobby in February 2015. More so, vagrants have gutted its wiring and destroyed several windows and access points. The on-site pool is currently covered as a precaution for Zika. Staff had undertaken a preliminary site assessment in advance of selecting Concourse Group as its P3 consultant. Below please find the very preliminary figures as requested at the Workforce/Affordable Housing Workshop to be used for conversational purposes only as we await the Concourse Group's analysis. The initial development investment for the property is$7,238,823 estimated at $200 per square foot with a 20 percent premium for LEED certification. The cost increases to$13,014,903 if the adjacent parking lot is developed as additional housing units. Adding the 10% design cost and fees, the project cost estimate becomes $15,097,287. Adding parking in lieu of fees ($1,140,000), the overall estimated direct development costs are $16,237,287. (Please note that the Commission can waive the parking fees.) In addition, the City must repay HUD $485,833 that had been previously expended in the property when it was owned by Miami Beach Community Development Corporation. The total estimated development cost to develop the Barclay Plaza Apartments as workforce housing is $ 16,723,120. In 2016, the City Commission established the target beneficiaries for the Barclay Plaza Apartments as educators, public safety personnel and municipal workers earning 120 to 140 percent AMI. This is a very narrow income range which would exclude a significant number municipal and public safety employees who earn at least 100 percent AMI but below 120 percent. In all, 537 City employees earn$45,450 to$68,160. Of these, 189 are public safety personnel. At its Workforce/Affordable Housing workshop, the City Commission suggested that a minimum period of tenure working in the City and/or living in the City be established for incoming tenants. Page 744 of 1596 However, a firm period of tenure was not provided. Staff would need to establish a firm tenure period to provide direction to Concourse Group for the fiscal analysis as well as to provide guidance, ultimately, to the site's developer. Staff recommends two years as a minimum tenure. This standard would apply for the length of employment for municipal employees and feeder pattern educators as well eligible current residents of the City seeking to relocate to the property. Please note that while broader tenant policies were referred to Committee for review once the Barclay Plaza Apartments RFP was ready for issuance, it is expected that tenants may remain eligible as long as they meet the eligibility criteria or until their lease is up for renewal. The property has a 10-space parking lot on its west side along with a full-size pool. This lot and the adjacent pool area have the potential for development to further maximize the number of units that can be developed. Staff recommends including this area for development within the RFP would increase the project's viability while also maximizing the number and size of units that could be offered on this site. Please note that these cost projections were included in the preliminary site analysis above. Finally, the exploration of mixed used developments was broached at the Commission meeting. This site, located across from the Convention Center and one block south of a new hotel being constructed at 21st Street and Park Avenue, can possibly house an accessory use, i.e. dry cleaner, gym, etc. to increase operational revenues. While staff is reluctant to specifically promote an accessory use, it wishes to note that certain financing resources for the rehabilitation of the historic structure may require a commercial component for funding approval.As such, staff recommends that the Commission allow for an accessory use if tied to the project's funding and only upon specific use approval by the Commission. This will enable respondents to the RFP to have broad latitude in conceptualizing the development site within the context of the surrounding neighborhood. RFP Criteria Considerations There were specific areas impacting the Barclay Plaza site that called for direction from the Committee. Below are the specific items requiring direction and the corresponding recommendations provided by the Committee: What income limits shall be served in the building: (120 to 140% Area Median Income AMI versus 80 to 140%AMI? (AMI) The Committee recommended that the income limits be adjusted to households earning up to 140%AMI to ensure the broadest inclusion possible. What rents will the project charge to its workforce tenants? The Committee requested that rents be further explored to ensure that they are as affordable as possible to the tenants who will be housed in the building.As such, the Committee held off on providing direction on this item pending the financial feasibility analysis from Concourse Group, the City's P3 consultant. For the workforce employed in the City, what is the minimum employment tenure within the City to be used to determine eligibility? Page 745 of 1596 The Committee concurred that a two-year employment tenure should be the threshold for consideration for tenants targeted by this project. What are the build-out options on the Barclay Plaza Apartments property that can be developed as additional housing, i.e. parking lot? The Committee recommended that the parking lot and existing pool be considered for development to maximize the number of units that can be developed. Commissioner Malakoff further noted that as many amenities as possible be considered including the possibility of a pool in the accessory building. Can there be a commercial component to the site to meet the needs of the area's residents? The Committee recommended that they were open to considering a commercial component but would require their review and consent in advance. What should be the mix of units for this development; should we look to serve families (i.e. 2 and 3 bedroom-units or individuals and couples(studios/1 bedroom units)? The Committee withheld direction on this item pending additional information from the City's employees regarding need and household composition for those who would be income eligible to reside at this project. Staff will conduct a survey of City employees and return to the earliest possible meeting of the Committee. CONCLUSION The Administration recommends accepting the recommendations delineated herein. KEY INTENDED OUTCOMES SUPPORTED Ensure Workforce Housing For Key Industry Workers Is Available In Suitable Locations Legislative Tracking Housing and Community Services ATTACHMENTS: Description o Resolution Page 746 of 1596