Resolution 2022-32411 RESOLUTION NO. 2022-32411
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY
OF MIAMI BEACH, FLORIDA, FOLLOWING A DULY ADVERTISED
PUBLIC HEARING, APPROVING AND AUTHORIZING THE
ADMINISTRATION TO FINALIZE, CONSISTENT WITH THE TERMS
CONTEMPLATED IN THIS RESOLUTION, PROPOSED REVISIONS TO
THE GROUND LEASE AGREEMENT BETWEEN THE CITY OF MIAMI
BEACH AND CFC-MB I, LLC ("LESSEE"), AN ARIZONA LIMITED
LIABILITY COMPANY, FOR THE COLLINS PARK ARTIST WORKFORCE
HOUSING PROJECT (THE "PROJECT") TO REFLECT THE CITY'S
ADDITIONAL MONETARY CONTRIBUTIONS FOR THE PROJECT, WITH
FUNDING APPROPRIATED AS PART OF THE FY 2023 ANNUAL
BUDGET AND ADDITIONAL FUNDING FROM A PORTION OF THE ARTS
AND CULTURE GENERAL OBLIGATION BOND ("G.O. BOND")
PROCEEDS; AND FURTHER, AUTHORIZING THE MAYOR AND CITY
CLERK TO EXECUTE THE FINAL NEGOTIATED AGREEMENT,
SUBJECT TO FORM APPROVAL BY THE CITY ATTORNEY, PROVIDED
THAT THE LESSEE IS ABLE TO FUND ANY REMAINING FINANCING
GAP AT THE TIME OF FINANCIAL CLOSING THROUGH THE MIAMI-
DADE COUNTY DOCUMENTARY STAMP SURTAX LOAN PROGRAM
AND/OR FROM OTHER FUNDING SOURCES.
WHEREAS, the City is the owner of the property located at 224 23rd Street, within
the Collins Park Cultural District (the "Property"), the current site of a 21-space surface
parking lot adjacent to the Miami Beach Regional Library and the Collins Park Garage
(G12); and
WHEREAS, pursuant to a competitive solicitation process, the City resolved to
redevelop the Property as a mixed-use residential workforce housing development that
prioritizes income-eligible artists, educators, City employees, veterans, and other
members of the Miami Beach workforce as tenants (the "Collins Park Artist Workforce
Housing Project" or"Project"); and
WHEREAS, on September 14, 2016, the Mayor and City Commission adopted
Resolution 2016-29547, selecting The Concourse Group to identify public-private
partnership ("P3") opportunities to alleviate the cost, and other burdens, on the City
associated with the development of workforce housing projects on City-owned property;
and
WHEREAS, on January 18, 2019, the City issued Invitation to Negotiate (ITN)
2019-099-KB, with a workforce housing development requirement, focused on attracting
artists and area educators to the City and encouraging proposers to incorporate dormitory
1
space for the Miami City Ballet, Inc. (the "Ballet"), South Florida's premier classical ballet
company and a not-for-profit cultural organization, headquartered in close vicinity of the
Property, at 2200 Liberty Avenue; and
WHEREAS, on July 17, 2019, the Mayor and City Commission adopted Resolution
2019-30908, authorizing simultaneous negotiations with both ITN proposers, Atlantic
Pacific Communities, LLC and Servitas, LLC ("Servitas" or "Developer"), and following
the withdrawal from negotiations of Atlantic Pacific Communities, LLC, the City
Commission directed negotiation with Servitas, the sole remaining proposer; and
WHEREAS, on September 23, 2020, the Finance and Economic Resilience
Committee (the"FERC") reviewed the proposed terms negotiated between the Developer
and the City Administration, and unanimously recommended that the City proceed with
the Project; and
WHEREAS, on October 18, 2020, the Mayor and City Commission adopted
Resolution 2020-31435, accepting the FERC's recommendation, approving the Project
term sheet, directing negotiation of a Development Agreement and Ground Lease, and
referring the Project for review by the Planning Board; and
WHEREAS, on November 17, 2020, the Planning Board unanimously passed
Resolution PB20-0407, transmitting the proposed Development Agreement and Ground
Lease to the City Commission with a favorable recommendation, in accordance with the
requirements of Section 1.03(b)(4) of the City Charter and the City's Land Development
Regulations; and
WHEREAS, on January 13, 2021, the Mayor and City Commission adopted
Resolution 2021-31553, authorizing the Development Agreement with the Developer;
Resolution 2021-31554, authorizing the Ground Lease for the Project; and Resolution
2021-31555, authorizing a waiver of the minimum and average unit size requirements for
up to ten (10) studio units in the Project and of the City Code's parking requirements with
respect to the Project, although, ultimately, no units were designed below the minimum
and average unit size requirement; and
WHEREAS, on June 6, 2021, the Historic Preservation Board ("HPB")
unanimously approved a Certificate of Appropriateness for the Project's design and
Servitas submitted its building permit application to the City's Building Department in
September 2021; and
WHEREAS, on February 23, 2022, the Mayor and City Commission adopted
Resolution 2022-32053, authorizing (i) an amendment(revision) of the Ground Lease, (ii)
the First Floor Sublease with the City as subtenant, and (iii) a cash subsidy of up to
$532,451 to cover a shortfall in permitting costs .attributed to the then-applicable
Sustainability Fee, and, in exchange, Servitas agreed to cap its developer fee to $1
million, at a cost to the Developer of approximately $600,000; and
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WHEREAS, this modification was intended to increase projected rental revenues
generated by the Project to address a financing gap attributed to economic conditions,
including inflation and rising construction costs and achieve the appropriate debt service
coverage ratio; and
WHEREAS, in April 2022, the City completed regulatory review of the Project's
construction plans, with payment of County and City development fees remaining as the
sole condition precedent before issuance of the building permit; and
WHEREAS, without the tax-exempt and taxable bond funding on hand to obtain
a building permit and to enter into a binding Guaranteed Maximum Price (GMP)
agreement with the general contractor, the Project has been unable to achieve financial
closing—a critical juncture in development when the Parties execute the Ground Lease
and First Floor Sublease and the Developer takes possession of the Property to
commence construction; and
WHEREAS, during the nearly nine months following the City Commission's
February 2022 authorization to adjust the Project's unit mix of income-eligible tenants,
economic conditions, including escalating interest rates, have impacted the Project's
financial viability; and
WHEREAS, global economic conditions have yielded significant increases in
overall construction costs, ranging from historic escalation in the price of materials, supply
chain disruption, delayed delivery and logistical concerns, and an increase in labor costs
due to a shortage of skilled workers, all of which have directly impacted the Project; and
WHEREAS, as demonstrated in the Project Proforma dated October 31, 2022,
attached as an exhibit to the Commission Memorandum accompanying this Resolution,
recent pricing estimates of materials and hard costs for the Project prepared by the
general contractor, are approximately 74% higher than when the Ground Lease was
approved in January 2021 and $3.1 million higher than when the City Commission
previously discussed the Project on February 23, 2022; and
WHEREAS, rising inflation and the increased costs associated with construction
materials and interest rates have resulted in a development budget higher than
anticipated at the time of the City Commission's original approval of the Ground Lease
and Development Agreement on January 13, 2021; and
WHEREAS, on March 9, 2022, the City Commission referred discussion to the
FERC regarding the elimination of additional development-related fees for affordable and
workforce housing projects; and
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WHEREAS, on March 15, 2022, the Affordable Housing Advisory Committee
passed a motion in support of exempting affordable and workforce housing from the
Sustainability Fee; and
WHEREAS, on April 6, 2022, the City Commission referred to the Land Use and
Sustainability Committee ("LUSC") a discussion about amending the Land Development
Regulations to exempt workforce projects from payment of the City's Mobility Fee; and
WHEREAS, on June 6, 2022, the City Commission accepted the May 27, 2022
recommendation of the FERC and the June 6, 2022 recommendation of the LUSC, and
referred legislation to the Planning Board to reduce development-related fees with the
goal of increasing the city's affordable and workforce housing stock; and
WHEREAS, on July 22, 2022, at the FERC budget briefing, the Committee
discussed how rising interest rates and escalating construction costs had led to an
additional Project financing gap of approximately $2.85 million and the FERC
recommended that the City Commission consider a one-time cash infusion to bridge this
gap; and
WHEREAS, on July 26, 2022, the Planning Board discussed the Project and
provided a favorable recommendation of an ordinance to reduce development-related
City fees for affordable and workforce housing (the "Fee Exemption Ordinance"); and
WHEREAS, on September 28, 2022, the City Commission approved Resolution
2022-32337, adopting the FY 2023 Capital Budget, including $2.85 million in gap
financing for the Project, as recommended on July 22, 2022 at the FERC Budget Briefing;
and Ordinance 2022-4513, authorizing the Fee Exemption Ordinance; and
WHEREAS, to date, the Administration has incurred approximately $31,000 in
upfront pre-development expenses related to. Project negotiation and approvals, and
upon financial closing and release of funds associated with the issuance of bond
financing, the Project will reimburse to the City approximately$31,000 in City upfront pre-
development expenses incurred up to this point; and
WHEREAS, the Administration and Servitas have explored several sources of
supplementary project funding, including:
• Miami-Dade County Impact Fee Exemption Ordinance: adopted on July 7, 2022 by
the Miami-Dade County Board of County Commissioners (BCC) to benefit affordable
and workforce housing development, which, along with a credit for existing
development on the Property, led to a 78% reduction in the County's impact fee
assessment for the Project reflecting $329,399 in savings; and
• City of Miami Beach Fee Exemption Ordinance: on September 28, 2022, the Mayor
and City Commission adopted Ordinance 2022-4513, waiving certain development-
4
related fees for affordable and workforce housing projects, which reduced
development-related fees for the Project in the amount of$1.26 million; and
• City Contribution: as recommended by the FERC and approved by the City
Commission via Resolution 2022-32337, the FY 2023 Capital Budget includes a one-
time financial contribution of up to $2.85 million, which $2.85 million is an advance
that will be reimbursed to the City from Project net revenues over approximately
fourteen (14) years on an annual basis through 2037; and
• Arts and Culture G.O. Bond Contribution — Miami City Ballet: on July 25, 2022, the
City Commission adopted Resolution 2022-32261, authorizing the November 8, 2022
ballot question for the issuance of$159 million in general obligation bonds, largely to
improve facilities programmed and/or operated by arts and cultural institutions
throughout the city, with $16 million for the Miami City Ballet to be used for multiple
capital projects, including $4 million to be contributed toward the cost of the buildout
of the Ballet's second-floor dormitory at the Project; and
• Miami-Dade County Documentary Stamp Surtax Loan: on August 26, 2022, the
Developer applied for Miami-Dade County Documentary Stamp Surtax Funding,
which could provide funding of up to $2 million, if recommended for approval by
County administrative staff and approved by the BCC; and
WHEREAS, the City Commission considered a revised Ground Lease that
incorporates two capital contributions by the City as funding sources for Project
development and financing: (1) Lessor Direct Capital Cost Contribution and (2) Lessor
Arts and Culture G.O. Bond Cost Contribution; and
WHEREAS, the Lessor Direct Capital Cost Contribution will be advanced to the
Project and paid to the Lessee (CFC-MB I, LLC) by the Lessor(City) in two installments,
with the first installment of$850,000 paid at financial closing, and the second installment
of up to $2 million no later than 45 days after the Project achieves 50% completion, as
evidenced by applications for payment received by the Developer from its general
contractor; and
WHEREAS, the first installment of the Lessor Direct Capital Cost Contribution may
be used for any Project expenses and the second installment may be used solely to pay
for Construction Costs associated with the improvements made by the Developer for the
benefit of the Lessee; and
WHEREAS, on November 8, 2022, Miami Beach residents voted and approved
the Arts and Culture G.O. Bond and, accordingly, the Revised Lease also contemplates
that if the Arts and Culture G.O. Bond is approved, the City would contribute the Lessor
Arts and Culture G.O. Bond Cost Contribution with a transfer of$4 million to the Lessee
either(i)45 days after issuance of the G.O. Bond or(ii) 45 days after the Project achieves
50% completion, whichever occurs sooner; and
WHEREAS, to the extent that the Lessor transfers any portion of the Lessor Arts
and Culture G.O. Bond Cost Contribution to the Lessee prior to the issuance of the first
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tranche of the Arts and Culture G.O. Bond, the Lessor intends to reimburse itself for the
Lessor Arts and Culture G.O. Bond Cost Contribution from the proceeds of the Arts.and
Culture G.O. Bond; and
WHEREAS, the Lessee must pay to the Lessor from amounts available from
Project Net Available Cash Flow, all amounts from time to time, as needed to fully
reimburse the City for the Lessor Direct Capital Cost Contribution, whereas the Lessor
Arts and Culture G.O. Bond Cost Contribution will not be reimbursed to the City; and
WHEREAS, the full amount of the Lessor Capital Cost Contribution and the Lessor
Arts and Culture G.O. Bond Cost Contribution do not provide adequate funding for the
Project and a financing gap of approximately$1.6 million exists, which may fluctuate daily
through the date of financial closing (the "Remaining Gap"); and
WHEREAS, to help ensure the realization of a significant City project that aims to
address the rental housing crisis, the Administration recommended that the Mayor and
City Commission approve the Revised Lease for the Collins Park Artist Workforce
Housing Project, provided that the Lessee is able to finance the Remaining Gap, if any,
through the Miami-Dade County Documentary Stamp Surtax Loan program and/or other
funding sources.
NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, following a duly advertised
public hearing, hereby approves and authorizes the Administration to finalize, consistent
with the terms contemplated in this Resolution, the proposed revisions to the Ground
Lease Agreement between the City of Miami Beach and CFC-MB I, LLC, an Arizona
limited liability company ("Lessee"), for the Collins Park Artist Workforce Housing Project
(the "Project") to reflect the City's additional monetary contributions for the Project, with
funding appropriated as part of the FY 2023 Annual Budget and additional funding, from
a portion of the Arts and Culture G.O. Bond proceeds; and further, authorizes the Mayor
and City Clerk to execute the final negotiated agreement, subject to form approval by the
City Attorney, provided that the Lessee is able to fund any remaining financing gap at the
time of financial closing through the Miami-Dade County Documentary Stamp Surtax
Loan program and/or from other funding sources.
PASSED and ADOPTED THIS /G day of N `'`''bel-. 2022.
ATTEST:
NOV21 2022
RAFAEL E. GRANADO, CITY CLERK DAN GELBER, MAYOR
„s, APPROVED AS TO
6 FORM &LANGUAGE
&FOR EXECUTION
€ii;coP,P or,r,TEa; -
?C;; G — City Attorney Date
Resolutions -R7 B
MIAMI BEACH
COMMISSION MEMORANDUM
TO: Honorable Mayor and Members of the City Commission
FROM: Alina T. Hudak, City Manager
DATE: November 16, 2022
2:15 p.m. Public Hearing
SUBJECT:A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY
OF MIAMI BEACH, FLORIDA, FOLLOWING A DULYADVERTISED PUBLIC
HEARING, APPROVING AND AUTHORIZING THE ADMINISTRATION TO
FINALIZE, CONSISTENT WITH THE TERMS CONTEMPLATED IN THIS
RESOLUTION, PROPOSED REVISIONS TO THE GROUND LEASE
AGREEMENT BETWEEN THE CITY OF MIAMI BEACH AND CFC-MB I,
LLC, AN ARIZONA LIMITED LIABILITY COMPANY, FOR THE COLLINS
PARK ARTIST WORKFORCE HOUSING PROJECT (THE "PROJECT") TO
REFLECT THE CITY`S ADDITIONAL MONETARY CONTRIBUTIONS FOR
THE PROJECT, WITH FUNDING APPROPRIATED AS PART OF THE FY
2023 ANNUAL BUDGET AND ADDITIONAL FUNDING, IF APPROVED BY
VOTERS, FROM A PORTION OF THE ARTS AND CULTURE G.O. BOND
PROCEEDS; AND FURTHER, AUTHORIZING THE MAYOR AND CITY
CLERK TO EXECUTE THE FINAL NEGOTIATED AGREEMENT, SUBJECT
TO FORM APPROVAL BY THE CITY ATTORNEY.
RECOMMENDATION
Approve the resolution authorizing revisions to the Ground Lease Agreement("Ground Lease")
for the Collins Park Artist Workforce Housing Project ("Project') to reflect the addition of
funding sources for the Project, including a $2.85 million contribution appropriated by the City
Commission as part of the FY 2023 Budget and, potentially, $4 million in capital funds if
approved via the Arts and Culture General Obligation (G.O.) Bond, and outlining the terms for
repayment of the$2.85 million contribution.
BACKGROUND/HISTORY
The City is the owner of the property located at 224 23rd Street,within the Collins Park Cultural
District (the "Property"), the current site of a 21-space surface parking lot adjacent to the Miami
Beach Regional Library and the Collins Park Garage (G12). Pursuant to a competitive
solicitation process, the City resolved to redevelop the Property as a mixed-use residential
workforce housing development that prioritizes housing for income-eligible artists, educators,
City employees, veterans, and other members of the Miami Beach workforce (the "Collins Park
Artist Workforce Housing Project" or"Project").
On September 14, 2016, the Mayor and City Commission adopted Resolution No. 2016-
Page 1024 of 1416
29547, selecting The Concourse Group to identify public-private partnership ("P3")
opportunities to alleviate the cost, and other burdens, on the City associated with the
development of workforce housing projects on City-owned property.
On January 18, 2019, the City issued Invitation to Negotiate (ITN) 2019-099-KB, with a
workforce housing development requirement, focused on attracting artists and area educators to
the City and encouraging proposers to incorporate dormitory space for the Miami City Ballet,
Inc. (the "Ballet') in the Project. The Ballet, South Florida's premier classical ballet company, is
a not-for-profit cultural organization, headquartered in close vicinity of the Property, at 2200
Liberty Avenue.
On July 17, 2019, the Mayor and City Commission adopted Resolution No. 2019-30908,
authorizing simultaneous negotiations with both ITN proposers, Atlantic Pacific Communities,
LLC and Servitas, LLC. Following the withdrawal from negotiations of Atlantic Pacific
Communities, LLC, the City Commission directed negotiation with the sole remaining proposer,
Servitas, LLC ("Servitas"or"Developer").
On September 23, 2020, the Finance and Economic Resilience Committee (the "FERC")
reviewed the proposed terms negotiated between the Developer and the City Administration,
and unanimously recommended that the City proceed with the Project.
On October 18, 2020, the Mayor and City Commission adopted Resolution No, 2020-31435,
accepting the FERC's recommendation, approving the Project term sheet, directing negotiation
of a Development Agreement and Ground Lease, and referring the Project for review by the
Planning Board.
On November 17, 2020, the Planning Board unanimously passed Resolution PB20-0407,
transmitting the proposed Development Agreement and Ground Lease to the City Commission
with a favorable recommendation, in accordance with the requirements of Section 1.03(b)(4)of
the City Charter and the City's Land Development Regulations.
On January 13, 2021, the Mayor and City Commission adopted Resolution No. 2021-31553,
approving, following second reading/public hearing, the Development Agreement with the
Developer; Resolution No. 2021-31554, approving the Ground Lease for the Project; and
Resolution No. 2021-31555, approving a waiver of the minimum and average unit size
requirements for up to ten (10) studio units in the Project and of the City Code's parking
requirements with respect to the Project. (Note: ultimately no units were designed below the
minimum and average unit size requirement.)
On June 6, 2021, the Historic Preservation Board ("HPB") unanimously approved a Certificate
of Appropriateness for the Project's design and Servitas submitted to the City's Building
Department its building permit application in September 2021.
On February 23, 2022, the Mayor and City Commission adopted Resolution No. 2022-32053,
modifying the required mix of income-eligible tenants of the workforce housing units for the
Project, providing that all of the workforce housing units would be rented solely to households
earning 120% or less of the area median income (AMI)for Miami-Dade County, consistent with
all applicable requirements relating to workforce housing in Chapter 58 of the City Code. This
modification was intended to increase projected rental revenues generated by the Project to
address a financing gap attributed to economic conditions including, inflation and rising
Page 1025 of 1416
construction costs and achieve the appropriate debt service coverage ratio.
On March 9, 2022, citing the discussion on February 23, 2022 to take further action to improve
the economic feasibility of the Project, the City Commission referred discussion to the FERC
about eliminating additional development-related fees for affordable and workforce housing
projects. On March 15, 2022, the Affordable Housing Advisory Committee passed a motion in
support of exempting affordable and workforce housing from the Sustainability Fee.
On April 6, 2022, the City Commission referred to the Land Use and Sustainability Committee
("LUSC") a discussion about amending the Land Development Regulations to exempt
workforce projects from payment of the City's Mobility Fee.
On June 6, 2022, the City Commission accepted the May 27, 2022 recommendation of the
FERC and the June 6, 2022 recommendation of the LUSC and referred legislation to the
Planning Board to reduce development-related fees for with the goal of increasing the city s
affordable and workforce housing stock.
On July 22, 2022, at the FERC budget briefing, the Committee discussed how rising interest
rates and escalating construction costs had led to an additional Project financing gap of
approximately $2.85 million and the Committee recommended that the City Commission
consider a one-time cash infusion to bridge this gap.
On July 26, 2022, the Planning Board discussed the Project and provided a favorable
recommendation of an ordinance to reduce City of Miami Beach development-related fees for
affordable and workforce housing (the"Fee Exemption Ordinance")to the City Commission.
On September 28, 2022,the City Commission approved the following:
i. Resolution 2022-32337, adopting the FY 2023 Capital Budget, including $2.85 million in gap
financing for the Project, as recommended on July 22,2022 at the FERC Budget Briefing.
ii. Ordinance 2022-4513, authorizing the Fee Exemption Ordinance.
On September 28, 2022, City Commission agenda item R7 F to consider the Revised Lease
for the Project was Opened and Continued to the October 26, 2022 meeting (R7 E) (where it
was subsequently Opened and Continued to the November 16, 2022 meeting).
ANALYSIS
P redevelopment Status
At the time of the City Commission's original approval of the Ground Lease and Development
Agreement on January 13, 2021, the Developer's predevelopment schedule and timeline estimated
that, by September 2021, the building permit would be issued and the Project would break ground.
Cost estimates construction and debt financing for the Project were based upon this timetable and
then-existing interest rates in late 2020. In actuality, the building permit application was initially
submitted for regulatory review in September 2021. Rising inflation and the increased costs
associated with construction materials and interest rates have resulted in a development budget
higher than anticipated at the time of the City Commission's January 2021 approval.
Page 1026 of 1416
The City's regulatory review of the Project's construction plans was completed in April 2022, with
payment of County and City development fees remaining as the sole condition precedent before
issuance of the building permit. Without the tax-exempt and taxable bond funding on hand to obtain a
building permit and to enter into a binding Guaranteed Maximum Price (GMP) agreement with the
general contractor, the Project has been unable to achieve financial closing—a critical juncture in
development when the Parties execute the Ground Lease and First Floor Sublease and the
Developer takes possession of the Property to commence construction.
Economic Climate and Construction Cost
During the nearly nine months following the City Commission's February 2022 authorization to adjust
the Project's unit nix of income-eligible tenants, economic conditions, including escalating interest
rates, have impacted the Project's financial viability. Citing inflation at a 40-year high, the Associated
General Contractors of America(AGC)'s July 2022 Construction Inflation Alert states:
The construction industry is in the midst of a period of exceptionally steep and fast-
rising costs for a variety of materials, compounded by major supply-chain disruptions
and difficulty finding enough workers—a combination that threatens the financial health
of many contractors. No single solution will resolve the situation, but there are steps •
that government officials, owners, and contractors can take to lessen the pain.
Global economic conditions have yielded significant increases in overall construction costs, ranging
from historic escalation in the price of materials, supply chain disruption, delayed delivery and
logistical concerns, and an increase in labor costs due to a shortage of skilled workers. Servitas has
explained how these have directly impacted the Collins Park Project:
• Increased material costs: including a major shortage of cement in South Florida, increases in
copper and aluminum costs impacting electrical and HVAC equipment, and the surge in price
for fossil fuels affecting delivery and transport of all materials.
• Supply chain delays: global computer processor shortages have created long lead times and
increased costs for assembled equipment components, such as air handlers, elevators, fire
alarm equipment, chillers, fire pumps, generators,and appliances.
• Skilled labor shortage: regional decline in truck drivers has increased labor costs for their
services. Due to elevated construction activity, subcontractors cherry-pick the most lucrative
projects, and subcontractors lock in their fixed-pricing guarantees for only 14 days, rather than
the typical 90 days, contributing to price volatility and an inability to maintain accurate cost
estimates.
Although construction pricing will continue to evolve until a GMP contract is executed and prices are
locked in, October 2022 pricing estimates of materials and hard costs by the Project's general
contractor, Moss & Associates, are approximately 74% higher than when the Ground Lease was
approved in January 2021 and $3.9 million higher than when the City Commission last discussed the
Project on February 23, 2022. See Exhibit A(Revised Proforma dated November 1, 2022).
Jan.2020 Feb.2022 Nov 2022 %Change
Lease Approval Revised Lease 12/2020 vs.
3
Reso. 2021-31553 1 Reso.2022-32053 2 Revised Lease 10/2022
Hard Costs $15,094,400 $23,094,965 $26,194,965 +73.5%
Project $27,454,260 $37,354,127 $41,277,957 +50.3%
Budget
1 Project Proforma dated 12/09/2020 attached to Resolution No.2021-31553
Page 1027 of 1416
2 Project Proforma dated 02/16/2022 attached to Resolution No.2022-32053
3 Project Proforma dated 10/31/2022 attached as Exhibit A.
Additional Funding Sources
On February 23, 2022, City Commission Resolution 2022-32053 authorized (i) an amendment of the
Ground Lease, (ii) the First Floor Sublease with City as subtenant, and (iii) a cash subsidy of up to
$532,451 to the Project to cover a shortfall in permitting costs attributed to the then-applicable
Sustainability Fee.[1] In exchange, Servitas agreed to cap its developer fee to $1 million, at a cost to
the Developer of approximately$600,000. It should be noted that, to date, the Administration incurred
approximately $31,000 in upfront pre-development expenses related to Project negotiation and
approvals. Upon financial closing and release of funds associated with the issuance of bond
financing for the Project, the Project will reimburse to the City approximately $31,000 in City upfront
pre-development expenses incurred up to this point.
At the July 22, 2022 FERC budget briefing, the Committee discussed the Project's $2.85M funding
gap. Since that time, the gap has widened considerably, due in part to the rising cost of debt from the
Federal Reserve's rate hikes intended to counter inflation. The Administration has met regularly with
Servitas to discuss the Developer's exploration of several sources of supplementary project funding.
a. Miami-Dade County Impact Fee Exemption Ordinance
On July 7, 2022, the Miami-Dade County Board of County Commissioners (BCC) adopted
Ordinance No. 22-80, amending the Code of Miami-Dade County relating to impact fee exemptions
for affordable and workforce housing development in incorporated and unincorporated areas. The
County ordinance expanded the existing impact fee exemption, from benefitting housing for tenants
up to 80% of the County's AMI, to now include workforce housing developments for tenants up to
120% of AMI. In addition, the Project has benefited from a reduction in its assessment due to credits
for existing development, as the Project is subject to a covenant in-lieu-of unity of title with the Miami
Beach Regional Library. Following enactment of the ordinance, the Administration has confirmed with
the County's Department of Regulatory and Economic Resources (DERM) Impact Fee Section that
the Project's Miami-Dade County impact fee assessment has reduced by 78% from $420,557 to
$91,158.
b. City of Miami Beach Fee Exemption Ordinance
During its February 23, 2022 meeting, the City Commission expressed a desire to explore additional
cost reductions for this Project and others, as a means to lower development costs and incentivize
greater housing development.As a result of enactment of the Fee Exemption Ordinance, adopted on
September 28, 2022 via Ordinance 2022-4513, development-related fees for the Project were
reduced by$1.26 million as follows:
Sustainability Fee $827,450
Mobility Fee $50,008
Technology and Training Fee $18,856
Parks Concurrency Fee $35,010
Art in Public Places Fee $330,980
Total $1,262,304
Page 1028 of 1416
•
c. City Contribution
While the City has already made significant contributions to the Project including but limited to use of
City-owned land, waiver of parking requirement, availability of 58 parking spaces, and certain
development fee waivers, the Project requires an additional subsidy. As recommended by the FERC
and approved by the City Commission via Resolution 2022-32337, the FY 2023 Capital Budget
includes a one-time enhancement of up to$2.85 million for a financial contribution to the Project.
This financial contribution will be advanced to the Project and paid to the Lessee. The City
Contribution is for use solely to cover capital and development costs and is an advance that will be
reimbursed to the City over approximately fourteen (14) years from Project net revenues on an
annual basis through 2037. The terms of this capital contribution are outlined further below in the
Revised Lease section.
d. Arts and Culture G.O. Bond Contribution—Miami City Ballet
On July 25, 2022, the City Commission adopted Resolution No. 2022-32261, authorizing the
November 8, 2022 ballot question to approve the issuance of$159 million in general obligation bonds
largely to improve facilities programed and/or operated by arts and cultural institutions throughout
the city. If approved by the voters, among the project list is$16 million for the Miami City Ballet to be
used for multiple capital projects, including$4 million to be contributed toward the cost of the buildout
of the Ballet's second-floor dormitory at the Project. The terms of this capital contribution are outlined
further below in the Revised Lease section.
e. Miami-Dade County Documentary Stamp Surtax Loan
On August 26, 2022, Servitas, on behalf of Ground Lessee, CFC-MB I, LLC, applied for Miami-
Dade County Documentary Stamp Surtax Funding, a program designed to provide gap funding and
address unmet needs in workforce and affordable housing, whose funding source is the County's
documentary "doc" stamp fee imposed by the County when documents are recorded in the public
record. The Surtax Loan could provide funding up to$2 million, which must be repaid to the County.
The Surtax Loan program requires implementation of certain green development standards that
could cost the Project approximately $513,000 in design and construction upgrades. The County's
Department of Public Housing and Community Development (PHCD) is currently reviewing the
application and an administrative decision is anticipated in late November 2022/early December
2022. If approved administratively, the BCC must then approve any recommended award during one
of its regular meetings.
Revised Lease
The proposed Revised Lease incorporates two capital contributions by the City: (1) Lessor Direct
Capital Cost Contribution and (2) Lessor Arts and Culture G.O. Bond Cost Contribution as funding
sources for Project development and financing.
The Lessor Direct Capital Cost Contribution will be advanced to the Project and paid to the Lessee
in two installments, with the first installment of $850,000 paid at financial dosing, and the second
installment of up to $2 million no later than 45 days after the Project achieves 50% completion.
Completion status will be evidenced by applications for payment received by the Developer from its
general contractor. The first installment may be used for any Project expenses and the second
installment may be used solely to pay for Construction Costs associated with the improvements made
Page 1029 of 1416
by the Developer for the benefit of Lessee. The Lessee (Developer) must pay to the Lessor (City)
from Net Available Cash Flow(i.e. Project revenues after the payment of all operating expenses and
satisfaction of all debt service and the payment of subordinated expenses including, maintenance
and operating reserves), all amounts from time to time available, as needed to fully reimburse the
City for the Lessor Direct Capital Cost Contribution.
The Revised Lease also contemplates that if the Arts and Culture G.O. Bond is approved by voters,
the City would contribute the Lessor Arts and Culture G.O. Bond Cost Contribution with a transfer of
$4 million to the Lessee on the earlier of(i) 45 days after issuance of the G.O. Bond or (ii)45 days
after the Project achieves 50% completion. To the extent that the Lessor transfers any portion of the
Lessor Arts and Culture G.O. Bond Cost Contribution to the Lessee prior to the issuance of the first
tranche of the Arts and Culture G.O. Bond, the Lessor intends to reimburse itself for the Lessor Arts
and Culture G.O. Bond Cost Contribution from the proceeds'of the Arts and Culture G.O. Bond. The
Lessor Arts and Culture G.O. Bond Cost Contribution will not be reimbursed to the City.
[1] The Fee Exemption Ordinance discussed below obviated the need for this subsidy as the
Project will be exempt from the previously applicable Sustainability Fee.
SUPPORTING SURVEY DATA
The Mayor and City Commission identified the need for workforce and affordable housing as a
key objective in the City's 2019 Strategic Plan Through the Lens of Resilience to "support
affordable, compatible workforce housing through public and private partners for key industries,
including the use of development incentives." In addition, in the City's 2019 Strategic Plan, the
City has committed to support, develop, coordinate, and promote performance, visual, and other
cultural arts within the City, including elevating the Collins Park Cultural District, where the
proposed Project is to be located. The City's 2040 Comprehensive Plan prioritizes workforce
housing, with the express goal "to encourage redevelopment that provides workforce and
affordable housing"within the City."
FINANCIAL INFORMATION
The City Commission has approved a $2.85 million financial contribution to the Project as part
of the FY 2023 Annual Budget to bridge the gap in development financing. However,the Project
is anticipated to be self-sustaining upon construction and stabilization.
CONCLUSION
The Administration recommends moving forward with the Revised Lease to formalize the City's
financial contribution necessary to bridge the gap in development financing. The Revised Lease
terms will allow the Developer to market the Project and reach financial closing as soon as possible,
potentially by December 2022.
The Administration recognizes that inflationary pressures as well as measures taken by the Federal
Reserve in an effort to combat inflation have increased Project construction and financing costs
through no fault of the Developer. To help fill the large gap in Project financing and to ensure the
realization of a significant City project that aims to address the pervasive rental housing crisis,
Servitas and the Administration have negotiated a measured strategy that balances different layers of
public funding to subsidize the first workforce housing project in the City's history with support for the
Miami City Ballet,one of the City's premier cultural anchors.
Page 1030 of 1416
The Administration therefore recommends that the Mayor and City Commission approve the
resolution authorizing the Revised Lease for the Collins Park Artist Workforce Housing Project.
Applicable Area
South Beach
Is this a"Residents Right Does this item utilize G.O.
to Know" item, pursuant to Bond Funds?
City Code Section 2-14?
Yes No
Strategic Connection
Mobility-Support affordable, compatible workforce housing.
Legislative Tracking
Economic Development
ATTACHMENTS:
Description
❑ Attachment A- Proforma
❑ Resolution
❑ Ad
Page 1031 of 1416
I PRELIMINARY
Miami Beach Ballet and Workforce Housing Proforma October 31,2022 Servitas-Development Model
Discussion Scenario
Assumptions Stabilized Pro Forma Summary
4 7,.42x4i f'.::AProject Summaryk _•P+-"c'�S'-"' us ,.,a /+:%OConafruction Scliedukh4e-45l ' l" MSt3-; $i+' FY 2024 Detailed Breakdown _ ,.FY2024d_, "`F,Y,2025
Number of Beds: ' 132 Projected Start Date: 12212022 Revenue /Unit /Bed 1NRSF
Number of Units: 88 Construction Period(months): 20 Ballet Housing
Net Rentable Square Footage: 47,820 Projected Completion Date: 7/12024 Master Lease with Ballet 127,344 393,494
Gross Sq.Footage+balconies: 74,010 Ballet Housing Subtotal 1,447 965 2.80 127,344 393,494
Retail Square Footage 2,248 sawrodenoemreaanwnora.,wa;anenc.,o Workforce Housing
Project Program Gross Potential Rent 8,889 5,926 17.21 782,196 2,381,786
Ballet Floor Vacancy 1,718 1,146 3.33 151,225 95,271
Unit Type Units Beds NRSF Rent(Master Leased) Utility Consumption Reimbursements 230 154 0.45 20,281 61,756
4 Bed Dorm 3 12 749 - Other Income 307 205 0.59 27,012 82,252
6 Bed Dorm 3 18 609 - Workforce Housing Subtotal 7,708 5,138 14.92 678,265 2,430,523
RA Una 1 1 650 - Non-Residential Revenues
Director Unit 1 _ 1 _ 1,100 - Retail Income 271 181 0.52 23,847 72,971
Subtotal 8 32 5,824 Retail Vacancy - - - - -
Retail Subtotal 271 181 _ 0.52 23,847 72,071
Workforce Housing Net Rental Revenue 9,426 6,284 1825 829,456 2,896,988
Unit Type Unite Beds NRSF Rent
Studio-120%AMI 37 37 403 2,049 Operating Expenses
1 bed-120%AMI 23 23 518 2,194 Ballet Expense Allowance 104 70 0.20 9,194 28.411
2 bed-120%AMI 20 40 640 2,634 Workforce Housing Expenses
Subtotal 80 100 39,625 Repairs&Maintenance 60 40 0.12 5,262 16,260
Total 88 132 45,449 Turnover c 121 80 0.23 10,609 32,782
Grounds&Landscaping 56 38 0,11 4,951 15,298
1",7:£::4 r:'.Inflation Ratesh.A W.EsS59 R22n,11tv,-,,,STVIAreeiFInancing"tioM46 Payroll 405 270 0.78 35,675 110,234
Income: 3.00% Avg.Annual Cost of Capital 7.218% Marketing&Leasing 64 43 0.12 5,658 17,484
Expenses: 3.00% Approx.Band Term(Years) 37 Administrative 121 80 0.23 10,609 32,782
Rent Growth: January_ Addl.Cap.Interest(Mos.) 6 Security 161 107 0.31 14,145 43,709
Contract Services 96 64 0,19 8,487 26,225
Project Budget Utilities 421 281 0.82 37,061 114,518
Budget Item %of Total_ Total Nnit flied INRSF /Gross SF Management Fee 283 189 0.55 24,884 86,910
Property Insurance 258 172 0.50. 22,661 70,022
}lard&Soft Protect Costs 2 Bike Passes for New Residents B . 5 0.02 707 2,185
Total Hard Costs 80% 26,194,965 297,670 198,447 576.36 353.94 2 Transit Passes for New Reisdents 36 24 0.07 3,197 9,878
A&E Fees 3% 1,070,000 12,159 8,106 23.54 14.46 Total Operating Expense 2.194 1,463 4.25 193,100 606,698
FF&E+IT 2% 690,216 7.843 5,229 15.19 9.33 Net Operating Income _ 7,2_31 4,821 14.00 636,356 2,290,290
Construction Administration 2% 523,899 5,953 3,969 11.53 7.08 -
Predevelopment Costs 3% 839,812 9,543 6,362 18.48 11.35 Additional Revenue
Permits,Inspections,end Fees 3% 1,022,266 11,617 7,744 22.49 13.81 Capitalized Interest Fund 25,623 17,082. 49.61 2,254,800 375,800 _
Start Up Expense 0% 120,000 1,364 909 2.64 1.62 Debt Service Reserve Fund Earnings - - - - 36,956
Development Contingency 4% 1,429,748 16,247 10,831 31.46 19.32 Total Additional Revenue 25,623 17,082 49.61 2254.800 412,756
Developer Fee 3% 1,000,000 11,364 7,576 22,00 13.51
Total Hard&Son Costs 100% 32,890,906 373,760 249,174 723.69 444,41 Additional Expenses
501c3 Fees 501 334 0.97 44,064 44,945
Financing Costs&Protect Escrows Audil/Trustee/Banldng etc 247 165 0.48 21,748 22,401
Cost oflssuance-Bonds 16% 1,319,470 14,994 9,996 29.03 17.83 Total Additional Expenses 748 499 1.45 65,812 67,346
Debt Service Reserve 29% 2463,700 27,997 18,664 54.21 33.29
Capitalized Interest 55% 4,603,880 52,317 34,878 101.30 62.21 Total Cash Available for Debt Service 32,108 21,404 62.17 2,825,343 2,635,699
Total Financing&Related 100% 8,387,051 95,307 63,538 185 113
Total Project Budget 41,277,957 409,068 312,712 908 558 Total Debt Service 23,418 15,612" 45.34 2060,800 2,060,800
This cost is calculated using the total horn the Construction Cost Affidavit rather than the Herd Costs in this budget Cash Flow after Debt Service 8.688 5,792 16.82 764,543 574,899
Notes: Debt Service Coverage Ratio 1.37 1.28
nloeo sconce reserve ere capex lbderealere lwasaer creels,meats,enmity and arsnn,meaa tie pored If unwed,
nl ea essurewmna am based trawled ptoiect sedan am scope in/cmet...suvm.was we subject a env.as project becomes weer dare. Subordmate Debt Service 2,205 1,470 427. 194,000 194,000
Cash Flow after Subordnate Debt Servic 6,483 4,322 1255 570,543 _380,899
Sources Aggregate Bond DSCR 125 1.17
Anticipated Band Proceeds 31,865,000 Bond Proceed Breakout
Interest Earnings 562,957 Senior Tax-Exempt 29,440,000 Reserve Deposits
Arts GO Bond 4,000,000 Senior Taxable 0 Repair and Replacement Fund 103 69 0.20 9,064 28,008
Surtax Loan 2,000,000 Senior Total 29,440,000 Operations Contingency Fund(withdraw, 736 490 1.42 64,728 153,783
City of Miami Beach Contribution 2,850,000 Total Reserve Deposits 73,792 181,791
Total 41,277,957 Subordinate 2,425,000 Cash Flow after Reserve Deposits 496,751 198,109
Uses Total Bonds 31,865,000' Surtax Loan
Project Fund 32,890,906 Surtax Loan Debt Service 282 188 0.55 24,823 74,468
Cost of Issuance 1,319,470 Cash Flow after Surtax Loan DS 5,363 3,575 10.38 471,928 124,640
Debt Service Reserve 2,463,700 Aggregate Coverage 1.24 1.13
Capitalized Interest 4,603,880 _
Total 41,277,957' Subordinated Expenses
Issuer Expense 181 121 0.35 15,933 15,933
Deferred Management Fee 94 63 0.18 8,295 28,970
Estimated Cash Flew During Bond Term(37 years). Total Subordinated Expenses 275 184 0.53 24,227 44,902
City Contribution Reimbursement 2850,000 Annual Project Cash Flow 447,701 79,738
Net Available Cash Flow(Rent) 33,918,195
Project Cash Flow 36,768,195 Distributions of Project Cash Flow 11/14/2022
City Contribution Reimbursement 447,701 79,73E
Net Available Cash Flow(Rent) - -
Pro Forma Cash Flows
Project Year 3 4 5 6 7 8 9 • 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Fiscal period ending Dec31 2024 2025 2026 2027 202E 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045
Months in Fiscal Year 4 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12
'Revenue : - - I
Ballet Housing .__ ._ _;
Master Lease with Ballet 127.344 393,494 405,299 417,458 429,982 442,881 456,168 469,853 483,948 498,467 513,421 528,823 544,688 561,029 577,859 595,195 613,051 631,443 650,386 669,897 689,994 710,694
Ballet Housing Subtotal _ 127,344 393,494 405,299 417,458 429,982 442,881 456,1613 469,853 483,948 498,467 513,421 528,823 544,688 561,029 577,859 595,195 613,051 631,443 650,386 669,897 689.994 710,694
Workforce Housing _ _._..___.....__ _.
Gross Potential Rent 782,196 2,381,786 2,453,240 2,526,837 2,602,642 2,680,722 2,761.143 2,843,977 2,929,297 3,017,176 3,107,691 3,200,922 3,296,949 3,395,858 3,497,734 3,602,666 3,710,746 3,822,068 3,936,730 4,054,832 4,176,477 4,301,771
Vacancy 151,225 95,271 98,130 101,073 104,106 107,229 110,446 113,759 117,172 120,687 124,308 128,037 131,878 135,834 139,909 144,107 148,430 152,883 157,469 162,193 167,059 172,071
Utility Consumption Reimbursements 20,281 61,756 63,608 65,517 67,482 69,507 71,592 73,740 75,952 78,230 80,577 82,994 65,484 88,049 90,690 93,411 96.213 99,100 102,073 105,135 108,289 111,538
Other Income 27,012 82,252 84,720 87,261 89,879 92,576 95,353 98,213 101,160 104,195 107,320 110,540 113,856 117,272 120,790 124,414 128,146 131,991 135,950 140,029 144,230 146,557
Workforce Housing Subtotal 678,265 2,430,523 2,503,438 2,578,542 2,655,898 2,735,575 2,817,642 2,902,171 2,989,236 3,078,914 3,171,281 3,266,419 3,364,412 3,465,344 3,569,305 3,676,384 3,786,675 3,900,276 4,017,284 4,137,802 4,261,936 4,389,794
Nori-FtesldentialRevenues , -
Retail Income 23,847 72,971 74,431 75,919 77,438 78,986 80,566 82,177 83,821 85,497 87,207 88,951 90,730 92,545 94,396 96,284 98,210 100,174 102,177 104,221 106,305 108,431
Retail Vacancy - - - - - - - - - - - - - - - - - - - - -Retail Subtotal 23,847 72,971 74,431 75,919 77,438 78,986 80,566 82,177 83,621 85,497 87,207 88,951 90.730 92,545 94,396 96,284 98,210 100,174 102,177 104,221 106,305 108,431
Net Rental Revenue 829,456 2,896,988 2,983,168 3,071,919 3,163,317 3,257,442 3,354,376 3,454,201 3,557,006 3,662,877 3,771,909 3,884,194 3,999,830 4,118,918 4,241,560 4,367,863 4,497,936 4,631,892 4,769,847 4,911,921 5,058,236 5,208,920
lOperatinglEipenses
Ballet Expense Allowance 9,194 28,411 29,263 30,141 31,045 31,977 32,936 33,924 34,942 35,990 37,070 38,182 39,327 40,507 41,722 42,974 44,263 45,591 46,959 48,368 49,819 51,313
�Norkform Ho`usl-' •-noes=-c ld,i:;.:.y J
Repairs B Maintenance 5,262 16,260 16,748 17,250 17,767 18,301 18,850 19,415 19,997 20,597 21,215 21,852 22,507 23,183 23,878 24,594 25,332 26,092 26,875 27,681 28,512 29,367
Turnover 10,609 32,782 33,765 34,778 35,822 36,896 38,003 39,143 40,317 41,527 42,773 44,056 45,378 46,739 48,141 49,585 51,073 52,605 54,183 55,809 57,483 59,208
Grounds&Landscaping 4,951 15,298 15,757 16,230 16,717 17,218 17,735 18,267 18,815 19,379 19,961 20,559 21,176 21,812 22,466 23,140 23,834 24,549 25,286 26,044 26,825 27,630
Payroll 35,675 110,234 113,541 116,948 120,456 124,070 127,792 131,626 135,574 139,642 143,831 148,146 152,590 157,168 161,883 166,739 171,741 176,894 182,201 187,667 193,297 199,095
Marketing&Leasing 5,658 17,484 18,008 18,548 19,105 19,678 20,268 20,876 21,503 22,148 22,812 23,497 24,201 24,927 25,675 26,446 27,239 28,056 28,698 29,765 30,658 31,577
Administrative 10,609 32,782 33,765 34,778 35,822 36,896 38,003 39,143 40,317 41,527 42,773 44,056 45,378 46,739 48,141 49,585 51,073 52,605 54,183 55,809 57,483 59,208
Security 14,145 43,709 45,020 46,371 47,762 49,195 50,671 52,191 53,757 55.369 57,030 58,741 60,504 62,319 64,188 66,114 68,097 70,140 72,244 74,412 76,644 78,943
Contract Services 8,487 26,225 27,012 27,823 28,657 29,517 30,402 31,315 32,254 33,222 34,218 35,245 36,302 37,391 38,513 39,668 40,1358 42,084 43,347 44,647 45,986 47,366
Utilities 37,061 114,518 117,953 121,492 125,137 128,891 132,758 136,740 140,842 145,06E 149,420 153,902 158,519 163,275 168,173 173,218 178,415 183,767 189,280 194,959 200,808 206,832
Management Fee 24,884 86,910 89,495 92,158 94,900 97,723 100,631 103,626 106,710 109,886 113,157 116,526 119,995 123,568 127,247 131,036 134,938 138,957 143,095 147,358 151,747 156,268
Property Insurance 22,661 70,022 72,123 74,286 76,515 78,810 81,175 63,610 86,118 88,702 91,363 94,104 96.927 99,835 102,830 105,914 109,092 112,365 115,736 119,208 122,784 126,467
2 Bike Passes for New Residents 707 2,185 2,251 2,319 2,388 2,460 2,534 2,610 2,688 2,766 2,852 2,937 3,025 3,116 3,209 3,306 3,405 3,507 3,612 3,721 3,832 3,947
2 Transit Passes for New Reisdents 3,197 9,878 10,175 10,480 10,794 11,118 11,452 11395 12,149 12,513 12,889 13,276 13,674 14,084 14,507 14,942 15,390 15.852 16,327 16,817 17,322 17,841
Non-Cash -
Total Operating Expense 193,100 606,698 624,877 643,601 662,886 682,750 703,208 724,281 745,984 768,339 791,363 815,078 839,504 864,661 890,574 917,262 944,751 973,065 1,002,226 1,032,263 1,053,199 1,095,063
'Net Operating income ' - I 636,356 2,290.290 2,358,291 2,428,318 2,500,431 2,574,693 2,651,167 2729,921 2,611,021 2,894,539 2,980,546 3,069,116 3,160,327 3,254,256 3,350,986 3,450,600 3,553,184 3,656,827 3,767,621 3,879,658 3,995.037 4,113,857
Additional Revenue
Capitalized Interest Fund 2,254,800 375,800 - - - - - - - - - - - - - - - - - - - -
DebtServiceReserveFundEarnings - 36,956 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911
Total Additional Revenue 2,254,800 412,756 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911 73,911
Additional Expenses
501c3 Fees 44,064 44,945 45,844 46,761 47,696 48,650 49,623 50,616 51,628 52.661 53,714 54,788 55,884 57,001 58,142 59,304 60,490 61,700 62,934 64,193 65,477 66,786
Audit/Trustee/Banking etc. 21,748 22,401 23,073 23,765 24,478 25,212 25,969 26,748 27,550 28,377 29,228 30,105 31,008 31,938 32,896 33,883 34,900 35,947 37,025 38,136 39,280 40,459
Total Additional Expenses 65,812 67,346 68,917 70,526 72,174 73,863 75,592 77,364 79,178 81,037 82,942 84,893 86,892 88,940 91,038 93,188 95,390 97,647 99,960 102,329 104,757 107,245
Total Cash Available for Debt Service 2,825,343 2,635,699 2,363,285 2,431,703 2,502,167 2,574,741 2,649,486 2,726,468 2,805,754 2,887,412 2,971,515 3,0513,134 3,147,346 3,239,228 3,333,859 3,431,324 3,531,705 3,635,091 3,741,572 3,851,240 3,964,191 4,080,523
''Debt Service _ _.I
Senior Debt Service 2,060,800 2,060,800 2,060,800 2,060,800 2,060.800 2,060,800 2,060,800 2,060,800 2,115,800 2,201,950 2,291,800 2,384,650 2,479,800 2,481,550 2,480,850 2,482,700 2,481,750 2,483.000 2,486,100 2,485,700 2,491,800 2,493,700
Total Debt Service 2,060,800 2,060,800 2,060,800 2,060,800 2,060,800 2,060,800 2,060,800 2,060,800 2,115,800 2,201,950 2,291,800 2,384,650 2,479,800 2,481,550 2,480,850 2,482,700 2,481,750 2,483,000 2,486,100 2,485,700 2,491,800 2,493,700
Cash Flow after Debt Service 764,543 574,899 302,485 370,903 441,367 513,941 588,686 665,666 689,954 685,462 679,715 673,484 667,546 757,678 853,009 948,624 1,049,955 1,152,091 1,255,472 1,365,540 1,472,391 1,586,823
Debt Service Coverage Ratio 1.37 1.28 1.15 1.18 1.21 1.25 1.29 1.32 1.33 1.31 1.30 1.28 1.27 1.31 1.34 1.38 1.42 1.46 1.50 1.55 1.59 1.64
ISubdrdlnita Debt SoMa';r'4 . onL:r: I
Subordinate Debt Service 194,000 194,000 194,000 194,000 194,000 194,000 194,000 194,000 219,000 222,000 219,600 217,200 219,800 217,000 219,200 221,000 222,400 223,400 224,000 224,200 219,000 223,800
Cash Flow after Subordinate Debt Service 570,543 380,899 108,485 176,903 247,367 319,941 394,686 471,66E 470,954 463,462 460,115 456,284 447,746 540,678 633,809 727,624 827,555 928,691 1,031,472 1,141,340 1,253,391 1263,023
Aggregate Bond[SCR 1.25 1.17 1.05 1.08 1.11 1.14 1.18 1.21 1.20 1.19 1.18 1.18 1.17 1.20 1.23 1.27 1.31 1.34 1.38 1.42 1.46 1.50
IRei-eiViDir-P-O-sitillIMIIIIIIIMIEMMIERI
Repair and Replacement Fund 9,064 28,008 28,848 29,713 30,605 31,523 32,469 33,443 34,446 35,479 36,544 37,640 38,769 39,932 41,130 42,364 43,635 44,944 46,293 47,681 49,112 50,585
Operations Contingency Fund(Withdrawal) 64,728 153,783 (45,063) 5,083 5,233 5,388 5,547 5,711 5,880 6,053 6,232 6,416 6,606 6,801 7,003 7,210 7,423 7,642 7,869 8,101 8,341 8,588
Total Reserve Deposits 73,792 181,791 (16,215) 34,797 35,838 36,911 38,016 39,154 40,326 41,533 42,776 44,057 45,375 46,734 48,133 49,574 51,058 52,567 54,161 55,783 57,453 59,173
Cash Flow after Reserve Deposits 496,751 199,109 124,699 142,106 211,529 283,030 356,670 432,515 430,628 421,930 417,339 412,228 402,370 493,944 585,677 678,050 776,497 876,105 977,311 1,085,557 1,195,93E 1,303,850
Surtax Lean Debt Service 24,823 74,468 74,468 74,468 74,468 74.468 74.468 74,468 74,468 74,468 74,468 74,468 74,468 74,468 74,468 74,468 74,468 74,468 74,468 74,468 74,468 74,468
Cash Flow after Surtax Loan DS 471,928 124,640 50,231 67,637 137,061 208,562 282,202 358,046 356,160 347,461 342,870 337,759 327,902 419,475 511,208 603,581 702,029 801,636 902,842 1,011,089 1,121,470 1,229,381
Aggregate Coverage 1.24 1.13 1.01 1.04 1.07 1.11 1.14 1.17 1.16 1.16 1.15 1.14 1.13 1.17 1.20 1.24 127 1.31 1.34 1.38 1.42 1.46
ISuboidinKed,Exps n
Issuer Expense 15,933 15,933 15,933 15,933 15,933 15,933 15,933 15,933 15.933 15,893 15,805 15,668 15,475 15,220 14,948 14,655 14,340 14,003 13,640 13,250 12,833 12,385
Deferred Management Fee 8,295 28,970 29,832 30,719 31,633 32,574 33,544 34,542 35,570 36.629 37,719 38,842 39,998 41,189 42,416 43,679 44,979 46,319 47,698 49,119 50,582 52,089
Total Subordinated Expenses 24,227 44,902 45,764 46,652 47,566 48.507 49,476 50,475 51,503 52,521 53,524 54,509 55,473 56,409 57,363 58,334 59,319 60,321 61,338 62,369 63,415 64,474
Annual Project Cash Flow 447,701 79.738 4,467 20,986 89,495 160,055 232,726 307,572 304,657 294,940 289,346 283,250 272,429 363,066 453,845 545,248 642,709 741,315 841,504 948,720 1,058,055 1,164,907
[Distributions of Project Cash Flow- I 11/14/2022
City Contribution Reimbursement 447,701 79,738 4,467 20,986 89,495 151,760 203,756 277,740 273,938 263,307 256,772 249,706 237,887 292,748 - - - - - - - -
ftelAvallablo Cash Plow(Rent) - - - - - - - - - - - - - 34,748 417,216 545,248 642,709 741,315 841,504 948,720 1,058,055 1,164,907
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Pro Forma Cash Flows
Project Year 47 48 49 50
Fiscal period ending Dec 31 2068 2069 2070 2071
Months in Fiscal Year 12 12 12 12
'Revenue
Ballet Housing,
Master Lease veth Ballet - - - -
Ballet Housing Subtotal - - - -
WerkforceHeuaing___________ �;I
Gross Potential Rent 8,489,917 8,744,615 9,006,953 9,277,162
Vacancy 339,597 349,785 360,278 371,086
Utility Consumption Reimbursements 220,129 226,733 233,535 240,541
Other Income 293,189 301,985 311,045 320,376
Workforce Housing Subtotal 8,663,639 8,923,548 9,191,255 9,466,992
Non-ResidentlalRevenues ,:jj
Retail Income 170,985 174,405 177,893 181,451
Retail Vacancy - - - -
Retail Subtotal 170,985 174,405 177,893 181,451
Net Rental Revenue 8,834,624 9,097,953 9,369,148 9,648,443
(OpemltrItiExpenses r '• - "?I
Ballet Expense Allowance 101,271 104,309 107,439 110,662
4
otkfoira,Houslrtp Expetisea,!,.,,rg�,^
Repairs B Maintenance 57,958 59,697 61,488 63,333
Turnover 116,851 120,357 123,968 127,687
Grounds 8 Landscaping 54,531 56,167 57,852 59,587
Payroll 392,932 404,720 416,862 429,367
Marketing 8,Leasing 62,321 64,190 66,116 68,100
Administrative 116,851 120,357 123,968 127,687
Security 155,802 160,476 165,290 170,249
Contract Services 93,481 96,285 99,174 102,149
Utilities 408,201 420,447 433,060 446,052
Management Fee 265,039 272,939 281,074 289,453
Property Insurance 249,594 257,082 264,795 272,739
2 Bike Passes for New Residents 7,790 8,024 8,265 8,512
2 Transit Passes for New Reisdents 35,211 36,268 37,356 38,476
Non-Cash - - - -
Total Operating Expense 2,117,833 2,181,317 2,246,704 2,314,052
'Net Operatinglncome 16,716,791 6,916,636 7,122,444 7,334,392
Additional Revenue
Capitalized Interest Fund - - - -
Debt Service Reserve Fund Earnings - - - -
Total Additional Revenue - - - -
Additional Expenses
501c3 Fees 105,315 107,422 109,570 111,761
Audit/Trustee/Banking etc 79,848 82,244 84,711 87,252
Total Additional Expenses 185,164 189,665 194,281 199,014
Total Cash Available for Debt Service 6,531,628 6,726,971 6,928,163 7,135,378
(Debt Servtoas ,I
Senior Debt Service - - - -
Total Debt Service - - - -
Cash Flow atter Debt Service 6,531,628 6,726,971 6,928,163 7,135,378
Debt Service Coverage Ratio - - - -
ISube dinaN,Detit Sikr-vIcitiaar:,i 'R#`.7.I
Subordinate Debt Service - - - -
Cash Flow after Subordinate Debt Service 6,531,628 6,726,971 6,928,163 7,135,378
Aggregate Bond DSCR - - - -
IReurve,DeposIts-- - - I
Repair and Replacement Fund 99,834 102,829 105,914 109,091
Operations Contingency Fund(wthdrawa0 16,507 16,996 17,501 -
Total Reserve Deposits 116,341 119,826 123,415 109,091
Cash Flow after Reserve Deposits 6,415,287 6,607,145 6,804,748 7,026,286
'Surtax Loan i. _ . I
Surtax Loan Debt Service - - - -
Cash FlowatterSartaeLeae DO 6,415,287 6,607,145 6,804,74E 7,026,286
Aggregate Coverage - - - -
ISubordlnetidlExpertw I
Issuer Expense - - - -
Deferred Management Fee 88,346 90,980 93,691 96,484 •
Total Subordinated Expenses 88,346 90,980 93,691 96,484
Annual Project Cash Flow 6,326,941 6,516,166 6,711,056 6,929,802
(Distributions of Project Cash Flow I 11/14/2022
City Contribution Reimbursement - - - -
Net Available Cash Flow(Rent) 6,326,941 6,516,166 6,711,05E 6,929,802
16N1 I NEIGHBORS i I SUNRAY SEPTEMBER 112022
CITY OF MIAMI BEACH CITY OF MIAMI BEACH
NOTICE OF PUBLIC HEARING NOTICE OF PUBLIC HEARINGS
BUDGET RELATED ITEMS
SEPTEMBER 28, 2022 SEPTEMBER 28,2022 HYBRID CITY COMMISSION MEETING
HYBRID CITY COMMISSION MEETING On September 2s,2022.the City o1 Miami Beach wit hoar a Hybrid Commission Meeting.During the
Hybrid Commission Meeting.the City Commission will be physically present in the Commission Chamber.
On September 28,2022,the City of Miami Beach will host a Hybrid Commission Miami Beach City Hall,1700 Convention Center Drive,3rd Floor,Miami Beach,FL 33139 The public is
Meeting.During the Hybrid Commission Meeting,the City Commission will be physically encouraged to attend the meeting wit/ally(as provided below).However,members of the public who wish to
ellend the meeting or provide pubec comment In person may appear al the Commission Chamber
present in the Commission Chamber,Miami Beach City Hall,1700 Convention Center Drive, To participate or provide comment virtually doing the Hybrid Commission Meeting.the public may loin
3rd Floor,Miami Beach,FL 33139.Applicants and the public are encouraged to attend the the webinar at.bona'/miamibeadhti'govacom.va1Va139285767LorVIA telephone at 1.301.715.6592(U S.)or
meeting virtually(as provided below).However,members of the public who wish to attend sae 475 4499(Toll-Free)Webinar ID;8139 28 576 71 C.Members of the public wanting to speak virtually on an
Item during the meeting must click the'rase hand'icon,1 using the Zoom app or press'9 on the telephone
the meeting or provide public comment in person may appear at the Commission Chamber. to raise pier hand
To participate or provide comment virtually during the Commission Meeting,the public NOTICE IS HEREBY GIVEN that the following Public Heanngs veil be heard by the Mayor and City
may join the webinar at:/11)&is://miamibeachti-oov ZoOm.us/i/61392857671 or via telephone Commissioners of the City of Miami Beach.Florida.on September 28,2022,at the limes dated or os soon
at:1.301.715.8592(U.S.)or 888.475.4499(Toll-Free).Webinar ID:81392857671a.Members thereafter as the maser can be heard:
Public Hau
of the public wanting to speak virtually on an Item during the meeting must click the-raise AO R1 ESOLUTION OFiste.SecondeTHE MAYOR AND adinn CITY COMMISSION OF THE CITY OF MIAMI BEACH.FLORIDA.
hand"icon it using the Zoom app or press'9 on the telephone to raise their hand. ADOPTING'1)THE FINAL AD VALOREM MILLAGE OF 5.6155 MILLS FOR FISCAL YEAR 2023 FOR GENERAL
OPERATING PURPOSES.WHICH IS THIRTEEN AND TWO TENTHS PERCENT(13 2%)MORE THAN THE
NOTICE IS HEREBY GIVEN that the following Public Hearing will be heard by the Mayor 'ROLLED.BACK'RATE OF 5.1376 MILLS:AND 2)THE DEBT SERVICE MILEAGE RATE OF 0.2360 MILLS.
and City Commissioners of the City of Miami Beach,Florida,on September 26,2022,at This Resolution Is being heard pursuant to Sections§§766.041 and 200.065 F.S.Imams may be directed to
5:15 p.m.or as soon thereafter as the matter can be heard: the Mee or Management and Budget at 305.673.7510.
5 15 on,Public Hearin kin Lot-Second Reading Public Hearing
V A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH.FLORIDA.
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI ADOPTING THE FINAL BUDGETS FOR THE GENERAL,G.O.DEBT SERVICE,RDA AD VALOREM TAXES.
BEACH,FLORIDA, FOLLOWING A DULY ADVERTISED PUBLIC HEARING,APPROVING NORTH BEACH CHA AD VALOREM TAXES,ENTERPRISE.INTERNAL SERVICE.AND SPECIAL REVENUE
REVISIONS TO THE GROUND LEASE AGREEMENT BETWEEN THE CITY OF MIAMI BEACH FUNDS FOR FISCAL YEAR 2023.This Resolution is being heard pursuant to Sections§§166.041 and 200 065
AND CFC-MB I,LLC,AN ARIZONA LIMITED LIABILITY COMPANY,FOR THE COLLINS F.S Inquiries may be directed to the Orrice of Management and Budget at 305.673 75t0
PARK ARTIST WORKFORCE HOUSING PROJECT (THE 'PROJECT') TO REFLECT 1:22 a.m.second Reaehre Public H.artno
THE CITY'S ADDITIONAL MONETARY CONTRIBUTIONS FOR THE PROJECT, WITH A RESOLUTION OF THE BOARD OF DIRECTORS OF THE NORMANDY SHORES LOCAL GOVERNMENT
NEIGHBORHOOD IMPROVEMENT DISTRICT ADOPTING THE FINAL A0 VALOREM MILLAGE RATE OF 0.9717
FUNDING APPROPRIATED AS PART OF THE FY 2023 ANNUAL BUDGET;AND FURTHER, MILLS FOR FISCAL YEAR 2023 FOR THE NORMANDY SHORES LOCAL GOVERNMENT NEIGHBORHOOD
AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE THE FINAL NEGOTIATED IMPROVEMENT DISTRICT.WHICH IS NINE AND SIX TENTHS PERCENT 19.6%1 MORE THAN THE"ROLLED-
AGREEMENTS.This Resolution is being heard pursuant to Section§166.041 F.S.Inquiries BACK"RATE OF 0.0864 MILLS This Resolution is being heard pursuant to Sections§§166.041 and 200.065
may be directed to the Economic Development Department at 305.673.7572. PS.Inqurnea may be directed to me Office 01 Management and Budget of 305.673.75t0
INTERESTED PARTIES are invited to take part In this meetingor represented b an agent. A'n)a.m.Second F THEm PublicARRMiming
P Y B A RESOLUTION OF BOARD OF DIRECTORS OF THE NORMANDY SHORES LOCAL GOVERNMENT
The public may submit written comments by sending an email to:CltvGielkbmiamibeachll.00v NEIGHBORHOOD IMPROVEMENT DISTRICT ADOPTING THE FINAL OPERATING BUDGET FOR FISCAL
by 5:00 p.m.the day before the Clly Commission Meeting. Please identify the Agenda YEAR 2023 This Resolution n being heard pursuant to Sections§§T65.041 and 200.065 F.S.Inquiries may be
Item Number in the email subject line.Emalls received will be forwarded to the Mayor and directed to the Omce of uanagemenl and Budget el 305 873.7510
Commissioners and will be included as a part of the meeting record. 1:23 a.m.Second Readiest Public Hearing
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH,FLORIDA,
Copies of Agenda hems are available for public inspection al:httos://www.miamibeachfI, ADOPTING THE FINAL CAPITAL IMPROVEMENT PLAN FOR FISCAL YEARS (FY) 2023- 2027 AND
pov/city-hall/cityclerk/agenda-archive-rnaln-Dase-2/This meeting,or any Item therein,may ADOPTING THE CITY OF MIAMI BEACH FINAL CAPITAL BUDGET FOR FISCAL YEAR 2023 This Resolution
be continued,and under such circumstances,additional legal notice need not be provided. is Being heard pursuant to Sections§§16E041 and 200.065 F.S.Inquules may be directed to the()thee or
Management and Budget at 305.673.7510
Pursuant to Section 286.0105,Fla.Stat.,the Cly hereby advises the public that if a Nate,The Second Routine Public Hearne of time Resolutions on September 28 7072 is subset BSrlly
person decides to appeal any decision made by the City Commission concerning any Commissenaomanlotymas.Resdudons an Finl Reading at the SeolemBcri4 202ICBYCarmelsston Waling.
matter considered at its meeting or its hearing,such person must ensure that a verbatim INTERESTED PARTIES are!noted to take part in this meeting or be represented by an agent.The public
record of the proceedings is made,which record includes the testimony and evidence upon may submit written comments by sending an email to.CitnClerktimramlbeachli pay by 5'00 p m the day before
the City Commission Meeting.Please identity the Agenda Item Number in the emal sublect line.Emaps received
which the appeal Is to be based.This notice does not constitute consent by the City for w11 be forwarded to the Mayor and Commissioners and wit be included as a part of the meeting record
the introduction or admission of otherwise Inadmissible or irrelevant evidence.nor does it Copies of Agenda beets are available for public inspection at.hone//wwwmiemdeachllaavledv-bell(
authorize challenges or appeals not otherwise allowed by law eatcciedyaoenday7lc.hes-main-gags-2/.Ibis meeting.or any Item therein,may be continued,and under such
circumstances.additional legal nonce need not be provided
To request this material in an alternate format,sign language interpreter(five-day notice Pursuant to Section 2860105,Fla Stat..the Cily hereby advises the public That If a person decides to
required),information on access for persons with disabilities,and/or any accommodation to appeal airy decision made by the City Commission concerning any mane.considered al its meeting or its
review any document or participate in any City-sponsored proceedings,call 305.604.2489 hearing.such person must ensure that a verbatim record of the proceedings a made,which record includes
and select 1 for English or 2 for Spanish,then option 6:TTY users may call via 711(Florida the testimony and evidence upon which the appeal is to be based.This notice does not constitute consent
by the City for the introduction or admission of otherwise aedmasdile or irrelevant evidence.nor does II
Relay Service). authorize challenges or appeals not otherwise allowed by law.
The City Commission Meeting will be broadcast IMe on Miami Beach TV (MBTV), To request Pis material in an alternate format.sign language interpreter(five-day notice required),
information on access for persons with disabilities.and/or any accommodation to review any document or
viewable on the City's webslte at httos//www.miamibeachtl.Gov/Government/1nbty/, parheipale n any Cily-sponsored proceedings,call 305.604.2489 and select 1 for English or 2 for Spanish,
as well as on Breezeline Cable channel 660, AT&T U-verse channel 99, Hotwire then option 6;TTY users may calf via 711(Florida Relay Service).
Communications channel 395,and ROKU device on PEG.TV channel,and on social media The City Commission Meeting will be broadcast live on Miami Beach TV(MTV).viewable on the Cily's
at htlos://www.faeobeok.eom/eitVofmiamibeeCh. wehsbe at h)m,Rwwwmlamlbeachbaav/aovernment/mbtn/.as wet as on Breetebne Cable channel 660,
AT&T Uverse channel 99,Hatwne Communications channel 395.and ROKU device on PEG TV channel,and
1 Rafael E.Granado,City Cterk on social media at httos/lvmvw lacebook camfclevolmiamiheasb
, , . B E A C`1 Cily of Miami Beach a / Rafael E Granada,City Clerk
r 1, 1B IE -yI City of Miami Beach
CitvClerkamiamibeachfl coy ;I I-'t, �! i. U L Ate. f CltoClerkimiamiaeagM.one
305.673.7411 305673 Mt
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