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Setai City Commission Meeting 5.26.21BOCA RATON FORT LAUDERDALE FORT MYERS GAINESVILLE JACKSONVILLE KEY WEST LAKELAND MELBOURNE MIAMI NAPLES ORLANDO TALLAHASSEE TAMPA WASHINGTON,DC WEST PALM BEACH 333 S.E.2ND AVENUE SUITE 3200 MIAMI,FLORIDA 33131 TEL 305-416-6880 FAX 305-416-6887 gray-robinson.com 305-416-6880 BRADLEY.GOULD@GRAY-ROBINSON.COM May 25, 2021 Via Email Only To: DanGelber@miamibeachfl.gov MickySteinberg@miamibeachfl.gov MarkSamuelian@miamibeachfl.gov Michael@miamibeachfl.gov stevenmeiner@miamibeachfl.gov RickyArriola@miamibeachfl.gov DavidRichardson@miamibeachfl.gov Honorable Mayor and City Commissioners City of Miami Beach 1700 Convention Center Drive Miami Beach, Florida 33139 Re: City Commission Hearing on the RM3 Oceanfront Ground Floor and Rooftop Additions (Agenda Item R5 B) and the Vacation of a Portion of the Southern Half of 21st Street between Collins Avenue and Miami Beach Drive (Agenda Item R7 A). Dear Honorable Mayor and City Commissioners: I represent the Setai Hotel Acquisition LLC (“SHA”) in connection with the above referenced matter. Please allow this letter to serve as my proffer of testimony for the Commission Meeting on Wednesday, May 26, 2021 in connection with the proposed text amendment to RM3 Oceanfront Ground Floor and Rooftop Additions and the vacation of a portion of the southern half of 21st Street between Collings Avenue and Miami Beach Drive. For the reasons set forth below, my client objects to both the proposed text amendment and the vacation of right of way and respectfully requests that the City deny both. THE DEMPSEY VANDERBILT HOTEL SHA purchased 88 units consisting of The Dempsey Vanderbilt Hotel located at 2001 Collins Avenue, Miami Beach FL in 2015. It is important to point out that my client was not involved in the development of the new tower or re-building of the Hotel. As the owner of The Dempsey Vanderbilt Hotel, my client is adversely affected by the proposed text amendment to RM3 Honorable Mayor and City Commissioners May 25, 2021 Page 2 GRAYROBINSON PROFESSIONAL ASSOCIATION Oceanfront Ground Floor and Rooftop Additions and the vacation of a portion of the southern half of 21st Street between Collings Avenue and Miami Beach Drive. Since the construction of the Seagull Hotel Property, which was completed in 1948, The Dempsey Vanderbilt Hotel has always enjoyed ocean views across the Seagull Hotel property. The City adopted Ordinance 2007-3589 which amended Section 142-246(d), in order to protect established and existing view corridors and prevent them from being substantially reduced. Thus, at the time my client purchased The Dempsey Vanderbilt Hotel through today its iconic ocean views across the Seagull Hotel property are protected. In fact, my client relied upon Section 142-246(d) and the protected ocean view corridor when it decided to purchase the hotel. Part of the bundle of rights purchased by SHA is the protected view corridor, and as such the protected ocean views are part of SHA’s reasonable investment backed expectation. OCEAN VIEW CORRIDOR IS A PROTECTED PROPERTY RIGHT There is a common misconception about whether views can ever be a protected property right. While views are not property rights under common law, they can be statutorily created and thus become protected property rights. In the oft cited case Fontainebleau Hotel Corp. v. Forty-Five Twenty-Five, Inc., 114 So.2d 357, the Third District Court of Appeals held that a landowner does not have a common law right to air, light and view across the adjacent property unless by contract or statute. The Court explained that if “public policy demands that a landowner in the Miami Beach area refrain from constructing buildings on his premises that will cast a shadow on the adjoining premises, an amendment of its ….zoning ordinance … is the means by which such purpose should be achieved.” Id. at 360. As provided for by the Court’s opinion, in 2007, the City amended its zoning ordinance to protect existing and established view corridors thereby creating a property right in the ocean view corridor of The Dempsey Vanderbilt Hotel. This opinion establishes that there is no common law cause of action between private neighbors regarding views unless by contract or statute, but it does not create any immunity for the City from causes of action for taking, eliminating, inordinately burdening, or governmental interference with property rights, including existing and established view corridors. PROPOSED TEXT AMENDMENT BHI Miami Limited (“BHI”)has proposed text amendments to the RM-3 Oceanfront Ground Floor and Rooftop Additions Within the Architectural District (Section 142-246). BHI is planning to redevelop the property with the Bvlgari Hotel. BHI recently purchased the subject property and as a result purchased it subject to the existing RM-3 regulations, including the limitations on enhancing and enlarging the former Seagull Hotel Building. BHI seeks to build an addition which would increase the height and width allowed under the existing code. BHI wants to increase the height and width of the addition to create additional ocean views. BHI is allowed to construct an addition under the existing regulations, but has proposed the text amendments to allow for an enhanced and enlarged Bvlgari Hotel which is inconsistent with the existing regulations. Honorable Mayor and City Commissioners May 25, 2021 Page 3 GRAYROBINSON PROFESSIONAL ASSOCIATION Although the Staff Report does not mention it, the most significant aspect of the proposed text amendments is the elimination of the language that provides for the protection of established and existing view corridors. See Section 142-246(d). This language was added to the code in 2007 pursuant to Resolution 2007-3589. The City recognizing the importance of ocean views, adopted this provision to prevent ocean views from being eliminated by building additions. By adopting Resolution 2007-3589, the City created a property right in existing and established view corridors. The current regulation protects existing and established view corridors by providing that the “proposed addition shall not shall not substantially reduce existing or established view corridors….” Statutory construction requires language added to have an effect and meaning and therefore, the only conclusion is that the language was added to protect existing and established view corridors and prevent building additions from substantially reducing them. Any argument to the contrary violates statutory construction. STAFF REPORT GROSSLY INADEQUATE The City cannot legally adopt the proposed text amendment as a result of the Staff Report which is grossly inadequate. The Staff Report intentionally fails to analyze or even identify that the proposed text amendment eliminates the protection of existing and established view corridors. While Staff discusses other aspects of the proposed amendment, the report does not discuss the view corridors even though Staff was well aware that BHI’s proposed development violates the existing regulations because it would substantially reduce an existing or established view corridor enjoyed as a property right by the Dempsey Vanderbilt Hotel. Hence City has intentionally not properly evaluated the effects of the proposed text amendment which constitutes an abuse of discretion and bad faith. The City cannot legally adopt the proposed text amendment until Staff has properly and adequately evaluated the proposed text amendment. INCONSISTENT WITH THE COMPREHENSIVE PLAN BHI’s proposed text amendment is inconsistent with the City’s Comprehensive Plan and therefore violates Section 163.3215, Florida Statutes. Policy 1.1(5) requires the City to regulate design of architecturally significant and oceanfront buildings. Section 142-246 provides for the regulation of oceanfront buildings by preventing new additions from substantially reducing existing or established view corridors. However, the proposed elimination of the protection of ocean view corridors, eliminates the City’s regulation of and/or the ability to regulate oceanfront buildings. As such it is inconsistent with the Comprehensive Plan and the City should not adopt it. QUASI-JUDICIAL HEARING The hearing on the proposed text amendments should be a quasi-judicial hearing. The proposed text amendments are designed to effectuate a single project, the Seagull Hotel/Bvlgaria Hotel property. The City’s determinations impact a single, particular property and thus effectually, is an Honorable Mayor and City Commissioners May 25, 2021 Page 4 GRAYROBINSON PROFESSIONAL ASSOCIATION application of policies on a particular property and not the imposition of new legislative policy. The City’s determinations are intended to be project specific to the proposed expansion and enlargement of the Seagull Hotel. Furthermore, the specific project and the City’s action are intentionally designed to adversely impact the Dempsey Vanderbilt Hotel and specific room lines which are individually owned and folioed condominium units. Because the actions before the City Commission will have an impact on a limited number of persons and property owners, and the decision is contingent on facts arrived at form distinct alternatives by applying rather than setting policy, the Dempsey Vanderbilt Hotel and its individual units that are adversely affected are entitled to a quasi-judicial hearing with all related due process rights and protections. This includes being allowed to participate in the hearing under the quasi-judicial rules of the City of Miami Beach which provides the right to cross-examine witnesses, call expert witnesses, and to obtain other protections and rights of procedural due process. The City has not provided SHA with a quasi-judicial hearing or any other protections and rights of due process. As such, the City is violation of the Florida and US Constitutions, and Section 163.3215(4), Florida Statute as well as the City’s rules. Unless the hearing is a quasi-judicial hearing, the Dempsey Vanderbilt Hotel is being denied its fundamental right to due process and to a meaningful hearing. ILLEGAL SPOT ZONING The proposed text amendment constitutes illegal spot zoning. As set forth in the Staff Report, the owner of the Seagull Hotel, in order to accommodate a new hotel operator and a major renovation, proposed the text amendment to the Land Development Regulations. The Staff Report identifies said owner as the applicant for the proposed text amendment. The purpose of the proposed text amendment is to allow the owner to develop the Seagull Hotel contrary to the existing Land Development Regulations. Thus, the proposed text amendment is intended to apply only to the applicant’s property. It provides preferential treatment to the Seagull Hotel property. Additionally, as drafted it negatively affects only the Dempsey Vanderbilt Hotel by eliminating its protected ocean view corridor. CONTRACT ZONING The City’s adoption of the proposed text amendments constitutes contract zoning and is therefore illegal. The proposed text amendments and the vacation of the right of way are inexplicitly intertwined and as a result, the Planning Board combined both into one agenda item. Since the City already has an easement pursuant to the plat dedication, the vacation of the right of way and then simultaneous re-conveyance back to the City for $7,000,000 constitutes a payment to the City in exchange for the proposed text amendments as well as future development orders as the actual payments are conditioned upon obtaining various development orders such as a temporary certificate of occupancy and a certificate of occupancy. VIOLATION OF SUBSTANTIVE DUE PROCESS The City’s adoption of the text amendments proposed by BHI is a violation of substantive due process pursuant to the Florida and United States Constitution. The City through its Commission Honorable Mayor and City Commissioners May 25, 2021 Page 5 GRAYROBINSON PROFESSIONAL ASSOCIATION in its legislative capacity, is acting arbitrary, capricious, unreasonable and for improper motives. The text amendment only benefits BHI and its proposed development plans and it is solely detrimental to the Dempsey Vanderbilt Hotel. ILLEGAL TAKING OF PROPERTY RIGHTS The City’s adoption of the text amendments proposed by BHI constitutes an illegal taking of property rights of SHA. The text amendment eliminates SHA’s property right of ocean view corridor. SHA will suffer significant economic impact due to the City’s elimination of its property right to ocean views. The proposed text amendments will significantly impact SHA’s reasonable investment backed expectation to own and operate a hotel with ocean views that were protected property rights pursuant to Section 142-246(d). The City’s adoption of the text amendment will constitute governmental interference with property rights. BERT J. HARRIS PRIVATE PROPERTY RIGHTS ACT The City’s adoption of the text amendment will trigger the Bert J. Harris Private Property Rights Act. It is a government action that is being applied to the Dempsey Vanderbilt Hotel which inordinately burdens an established or vest right. TRANSFERRING CITY PROPERTY RIGHTS AND INCREASING FAR WITHOUT A REFERENDUM We note that a public interest advocate, Miami Beach United, (“MBU”) has objected to the proposed vacation of 21st Street. MBU has argued, and we agree, that the proposed transfer and aggregating of City property (that currently provides a vested easement to the beach) with the property of the Seagull/Bvlgari increases the FAR on the Seagull/Bvlgari site, without a referendum, and breaches one or more provisions of Section 1.03 City Charter that were approved by the electors to protect the citizens, residents, and property owners of the City of Miami Beach. These referendum requirements were acquired through citizen referendum elections This proposal violates the letter and intent of those provisions which are to be broadly construed to protect the public interest. The proposed City Commission vote to circumvent these City Charter protected referendum provisions would illegally, without due process, abridge the City Charter. NOTICE OF ZONING ORDINANCE AMENDMENT DEFICIENT The City and State required notices for the reading and hearing of the proposed zoning text amendment related to RM3 Oceanfront Ground Floor and Rooftop Additions were not placed in the agenda package submitted to the City Commission and appear to have not been provided. The matter should not be heard. The lack of timely notice has prevented my clients from marshalling its evidence, calling its witnesses, and preparing its argument in this cause. Moreover, compliance with said notice requirements is jurisdictional and renders any action, without such required notice, nugatory Honorable Mayor and City Commissioners May 25, 2021 Page 6 GRAYROBINSON PROFESSIONAL ASSOCIATION Respectfully submitted, Bradley S. Gould BSG/jd cc: Alina T. Hudak, City Manager (via email to: alinahudak@miamibeachfl.gov) Raul Aguila, City Attorney (via email raulaguila@miamibeachfl.gov ) Rafael Granado, City Clerk (via email rafaelgranado@miamibeachfl.gov) Thomas Mooney, Planning Director (via email thomasmooney@miaimibeachfl.gov)