Resolution 2018-30338RESOLUTION NO, 2018 -30338
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE
CITY OF MIAMI BEACH, FLORIDA, ACCEPTING THE
RECOMMENDATION OF THE FINANCE AND CITYWIDE PROJECTS
COMMITTEE TO LIST THE PENNSYLVANIA GARAGE RETAIL
SPACE, CONSISTING OF APPROXIMATELY 7,722 SQUARE FEET,
LOCATED AT 1661 PENNSYLVANIA AVENUE; AND AUTHORIZING
THE CITY MANAGER TO ISSUE A NOTICE TO PROCEED,
PURSUANT TO THE PROFESSIONAL SERVICES AGREEMENT
BETWEEN THE CITY AND CBRE, INC., FOR REAL ESTATE
BROKERAGE SERVICES, PURSUANT TO RFQ 2016- 152 -WG.
WHEREAS, the Pennsylvania Garage building consists of 572 municipal parking
spaces and approximately 7,700 square feet of ground floor retail space; and
WHEREAS, in 2011, the City, represented by broker The Koniver Stern Group,
Inc., executed a lease agreement for the retail space with tenant, Penn 17, LLC ( "Penn
17 "), for a period of ten (10) years; and
WHEREAS, in 2015, the City terminated the lease agreement due to
nonpayment of rent and, since that time, the City has utilized the vacant space for
various municipal functions; and
WHEREAS, in October 2017, the City executed a Professional Services
Agreement (the "Agreement ") with CBRE, Inc. ( "CBRE "), for Real Estate Brokerage
Services, pursuant to RFQ 2016 - 152 -WG; and
WHEREAS, CBRE is a full service real estate company with international reach
and local retail expertise that is well qualified to identify a quality tenant in an
expeditious manner; and
WHEREAS, pursuant to the Agreement, the City would be obligated to pay a
commission of four percent (4%) of the Base Rent, payable if tenant is not represented
by a broker, or six percent (6%) of the Base Rent if tenant is represented by a broker;
and
WHEREAS, the commission is paid fifty percent (50 %) upon lease execution and
fifty percent (50%) upon occupancy and rent commencement; and
WHEREAS, based upon the estimated monthly rent revenue of $41,000 -
$48,000, the City will be obligated to pay a leasing commission of approximately
$98,000 (if tenant is unrepresented) or $172,000 (if tenant is represented); and
WHEREAS, on May 18, 2018, the Finance and Citywide Projects Committee
(FCWPC) recommended that the City list the Pennsylvania Garage retail space with
CBRE; and
WHEREAS, the Administration recommends that the Mayor and City
Commission accept the FCWPC's recommendation to list the retail space with CBRE;
and, further, recommends authorizing the City Manager to issue a Notice to Proceed, as
required under the Agreement, substantially in the form attached to the City
Commission Memorandum accompanying this Resolution.
NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City
Commission hereby accept the recommendation of the Finance and Citywide Projects
Committee to list the Pennsylvania Garage retail space, consisting of approximately
7,722 square feet, located at 1661 Pennsylvania Avenue; and authorize the City
Manager to issue a Notice of Proceed, pursuant to the Professional Services
Agreement between the City and CBRE, Inc., for Real Estate Brokerage Services,
pursuant to RFQ 2016- 152 -WG.
PASSED and ADOPTED THIS (, day of (It;ne 2018.
ATTEST:
d
Raf el E. Granado, City Clerk �'�tc;�
Dan Gelber, Mayor
APPROVED AS TO
FORM & LANGUAGE
& FOR EXEQUTION
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City Attorney
Date
MIAM
BEACH
Resolutions - C7 U
COMMISSION MEMORANDUM
TO: Honorable Mayor and Members of the City Commission
FROM: Jimmy L. Morales, City Manager
DATE: June 6, 2018
SUBJECT: A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF
MIAMI BEACH, FLORIDA, ACCEPTING THE RECOMMENDATION OF THE
FINANCE AND CITYWIDE PROJECTS COMMITTEE TO LIST THE
PENNSYLVANIA GARAGE RETAIL SPACE, CONSISTING OF APPROXIMATELY
7,722 SQUARE FEET, LOCATED AT 1661 PENNSYLVANIA AVENUE; AND
AUTHORIZING THE CITY MANAGER TO ISSUE A NOTICE TO PROCEED,
PURSUANT TO THE PROFESSIONAL SERVICES AGREEMENT BETWEEN THE
CITY AND CBRE, INC., FOR REAL ESTATE BROKERAGE SERVICES,
PURSUANT TO RFQ 2016-152-WG.
RECOMMENDATION
Adopt the Resolution.
BACKGROUND
The Pennsylvania Garage building consists of 572 municipal parking spaces and approximately
7,700 square feet of ground floor retail space. In September 2011, the City executed a new lease
agreement for the retail space with Penn 17, LLC ( "Penn 17 ") for a period of ten (10) years. The
City was represented by Koniver Stern Group ( "Koniver Stern ") who was paid a leasing commission
of approximately $303,000 in conjunction with this transaction. This amount was split with the broker
who represented Penn 17. When Penn 17 failed to make the required rent payments under the
lease, the City terminated the lease in March 2015. Penn 17 vacated the space in July 2015.
Since that time, the City has utilized the vacant space for various purposes such as EnerGov
training, temporary offices for Code Compliance and Housing & Community Services and as a
temporary location for the Miami Beach Chamber of Commerce Visitor's Welcome Center. In
October 2017, the City executed a Professional Services Agreement (the "Agreement ") with CBRE,
Inc. ( "CBRE "), for Real Estate Brokerage Services, pursuant to RFQ 2016- 152 -WG.
ANALYSIS
CBRE is a full service real estate company with international reach and local retail expertise. They
are well qualified to identify a quality tenant in an expeditious manner. Pursuant to the Agreement, the
City would be obligated to pay a commission of four percent (4%) of the Base Rent, payable if the
tenant is not represented by a broker, or six percent (6 %) of the Base Rent if the tenant is
represented by a broker. The commission is paid fifty percent (50%) upon lease execution and fifty
percent (50 %) upon occupancy and rent commencement. Based upon the estimated monthly rent
revenue of $41,000 - $48,000, the City will be obligated to pay a leasing commission of $98,000 (if
tenant is unrepresented) or $172,000 (if tenant is represented).
Page 641 of 1103
Finance and Citywide Projects Committee
This item was presented at the May 18, 2018 Finance and Citywide Projects Committee meeting and
the FCWPC recommended the City list the Pennsylvania Garage retail space with CBRE.
CONCLUSION
The Administration recommends that the Mayor and City Commission accept the recommendation of
the Finance and Citywide Projects Committee and authorize the City Manager to issue a Notice to
Proceed to CBRE, attached hereto as Exhibit A.
Legislative Tracking
Tourism, Culture and Economic Development
Sponsor
Commissioner Arriola
ATTACHMENTS:
Description
Exhibit A - Notice to Proceed to CBRE
Resolution
Page 642 of 1103
City of Miami Beach, 1700 Convention Center Drive, Miami Beach, Florida 33139, www.miamilneachil goy
OFFICE OF THE CITY MANAGER
June 6, 2018
Shay Pope
Senior Vice President
CBRE, Inc.
777 Brickell Avenue
Miami, FL 33131
Re:
Professional Services Agreement (PSA) between the City of Miami Beach,
Florida (City) and CBRE, Inc, (CBRE) for real estate brokerage services,
pursuant to RFQ 2016 - 152 -WG
Subject: Notice to Proceed - Approximately 7,722 square feet of ground floor retail
space at the Pennsylvania Avenue parking garage, 1661 Pennsylvania
Avenue, Miami Beach, Florida (Property)
In accordance with Section 2.2. of the above- referenced PSA, the City hereby requests that you
commence providing real estate leasing services for the Property identified above, for a period
of 12 months, at which point the listing will terminate, and should the City wish to continue listing
the property, a new Notice to Proceed will be issued. Notwithstanding, the City shall have the
option to terminate the real estate leasing services for the Property at any time upon providing
thirty (30) days written notice.
Should you have any questions, please do not hesitate to contact Mark Milisits, Office of Real
Estate, at (305) 673 -7000 ext. 6443.
Sincerely,
Jimmy Morales
City Manager
cc: Mark Milisits, Division Director
NOTICE TO PROCEED RECEIVED AND ACKNOWLEDGED BY CBRE, INC.:
Signature:
Print Name:
Title:
Date:
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