Resolution 2024-32912 RESOLUTION NO! 2024-32912
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI
BEACH, FLORIDA, AUTHORIZING AMENDMENT NO. 5 TO THE MANAGEMENT
AGREEMENT DATED OCTOBER 7, 2013 BETWEEN THE CITY OF MIAMI BEACH
AND GLOBAL SPECTRUM L.P. D/B/A OVG360 FOR THE MIAMI BEACH
CONVENTION CENTER (EXISTING AGREEMENT) EXTENDING THE TERM OF THE
EXISTING AGREEMENT FOR AN ADDITIONAL SIX(6) MONTHS, COMMENCING ON
APRIL 1, 2024 AND EXPIRING ON SEPTEMBER 30, 2024, SUCH THAT ANNUAL
PERIODS INCLUDED IN THE TERM OF THE NEW MANAGEMENT AGREEMENT TO
BE EXECUTED WITH OVG360 WILL ALIGN WITH THE CITY OF MIAMI BEACH
FISCAL YEAR; AND APPROVING THE WAIVER, BY 5/7TH VOTE, OF THE FORMAL
COMPETITIVE BIDDING REQUIREMENT IN SECTION 2-367 OF THE CITY CODE;
AND FURTHER, AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE
AMENDMENT NO. 5.
WHEREAS, the City and Global Spectrum L.P. ("Global") are parties to a Management
Agreement, dated October 7, 2013, pursuant to which the City engaged Global to manage and
operate the Miami Beach Convention Center(the Management Agreement, as so amended and
modified, is referred to herein as the"Agreement"); and
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WHEREAS, the initial term of the Agreement was three (3) years, ending on September
30, 2016, subject to the City's right to extend the term for an additional two (2) years; and
WHEREAS, on October 21, 2015, in Resolution No. 2015-29191, the Mayor and City
Commission approved Amendment No. 1 to the Agreement;extending the term thereof through
September 30, 2020; and
WHEREAS, on September 23, 2016, the City Manager accepted notice to terminate the
agreement for Global as manager and operator of the Colony Theater effective, September 30,
2016; and
WHEREAS, on September 12, 2018, in Resolution No. 2018-30508, the Mayor and City
Commission approved Amendment No. 2 to the Agreement, extending the term thereof through
September 30, 2022; and
WHEREAS, on September 11, 2019, in Resolution No. 2019-30986, the Mayor and City
Commission approved Amendment No. 3 to the Agreement, approving an increase in Global's
monthly impress amount and established a Global funded annual internship contribution; and
WHEREAS, on June 23, 2021, in Resolution No. 2021-31754, the Mayor and City
Commission approved Amendment No. 4 to the Agreement providing for the management and
maintenance, by Global, of Collins Canal Park, the two (2) clubhouse buildings formerly known
as the Carl Fisher Clubhouse and Little Stage Theaters, and Pride Park, including the mangroves
along Collins Canal with the footprint of the park; and provided for an additional annual fee of
seventy-five thousand dollars ($75,000) in consideration of the additional scope, and extended
the term of the Agreement to March 31, 2024; and
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WHEREAS, the extension of the agreement for 18 months resulted in the misalignment
of the term of the Agreement with the City's fiscal year; and
' WHEREAS, in June 2022, Global notified the City of a merger between Global and Oak
View Group and it intent to operate and manage the Miami Beach Convention Center under the
fictitious name"OVG360"; and
WHEREAS, Amendment No. 5 to the Agreement will extend the term by six (6) months,
from April 1, 2024 through September 30, 2024, to align with the related Sodexo Live! and
GMCVB agreements and the City's fiscal year; and
WHEREAS, the terms of the proposed Amendment No. 5 create continuity of operations
during the return of international and domestic conventions, conference and destination
meetings, the advancement of the convention center hotel, and to create symmetry amongst
convention center related management, operations and sales agreements during a critical period
of reputation growth is in the best interest of the City; and
WHEREAS, for the foregoing reasons, the Administration recommends that the Mayor
and City Commission approve Amendment No. 5 to the Agreement.
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 authorize, Amendment No. 5 to the management agreement dated October
7, 2013 between the City of Miami Beach and Global Spectrum L.P. d/b/a OVG360 for the Miami
Beach Convention Center(existing agreement) extending the term of the existing agreement for
an additional six(6) months, commencing on April 1, 2024 and expiring on September 30, 2024,
such that annual periods included in the term of the new management agreement to be executed
with OVG360 will align with the City of Miami Beach fiscal year; and approve the waiver, by 5/7th
vote,of the formal competitive bidding requirement in Section 2-367 of the City Code; and further,
authorize the Mayor and City Clerk to execute Amendment No. 5.
PASSED AND ADOPTED this 42/ day of Kdnl4r/ 2024.
ATTEST: ..—.- Of
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2024
Rafael E. Granado, City Clerk - Steven Meiner, Mayor
3 1 : I APPROVED AS TO
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For City Attorney Date
Resolutions-C7 B
MIAMIBEACH
COMMISSION MEMORANDUM
TO: Honorable Mayor and Members of the City Commission
FROM: Alina T. Hudak, City Manager
DATE: February 21, 2024
SUBJECT:A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY
OF MIAMI BEACH, FLORIDA, AUTHORIZING AMENDMENT NO. 5 TO THE
MANAGEMENT AGREEMENT DATED OCTOBER 7, 2013 BETWEEN THE
CITY OF MIAMI BEACH AND GLOBAL SPECTRUM L.P. D/B/A OVG360
FOR THE MIAMI BEACH CONVENTION CENTER (EXISTING
AGREEMENT) EXTENDING THE TERM OF THE EXISTING AGREEMENT
FOR AN ADDITIONAL SIX (6) MONTHS, COMMENCING ON APRIL 1, 2024
AND EXPIRING ON SEPTEMBER 30, 2024, SUCH THAT ANNUAL
PERIODS INCLUDED IN THE TERM OF THE NEW MANAGEMENT
AGREEMENT TO BE EXECUTED WITH OVG360 WILL ALIGN WITH THE
CITY OF MIAMI BEACH FISCAL YEAR; AND APPROVING THE WAIVER,
BY 5/7TH VOTE, OF THE FORMAL COMPETITIVE BIDDING
REQUIREMENT IN SECTION 2-367 OF THE CITY CODE; AND FURTHER,
AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE
AMENDMENT NO. 5.
RECOMMENDATION
It is recommended that the Mayor and City Commission adopt the resolution approving
Amendment No. 5 to the existing Management Agreement dated October 7, 2013 between the
City and Global Spectrum L.P. d/b/a/ OVG360 for the management of the Miami Beach
Convention Center to extend the term by six(6)months.
BACKGROUND/HISTORY
On July 17, 2013, the Mayor and City Commission adopted Resolution No. 2013-28276,
authorizing the City and Global Spectrum, L.P. ("Global") to negotiate and execute a
Management Agreement for the management of the Miami Beach Convention Center and the
Colony Theater, (as amended and modified, is referred to herein as the "Management
Agreement"or"Agreement").
On October 7, 2013, the Administration entered into a Management Agreement with Global with
an initial term of three (3) years commencing on October 1, 2013 and expiring on September
30, 2016, with two (2)one-year renewal options in the City's favor.
Pursuant to Resolution No. 2015-29191, the Mayor and City Commission approved
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Amendment No. 1 to the Agreement, extending the term through September 30, 2020.
Pursuant to a letter dated September 23, 2016, the City and Global confirmed the City's
termination for convenience of Global's responsibilities as manager and operator of the Colony
Theatre, as permitted in subsection 12.2(c) of the Agreement. Global's management
responsibilities for the Miami Beach Convention Center did not change.
In October 2018, the City and Global executed Amendment No. 2 (authorized by Resolution
No. 2018-30508), extending the term of the Agreement for an additional two (2) years,
commencing on October 1, 2020 and expiring on September 30, 2022, for a total term of nine
(9)years, including all prior renewals and extensions.
In September 2019, pursuant to Resolution No. 2019-30986, Amendment No. 3 to the
Agreement increased OVG360's monthly imprest amount and established an OVG360-funded
annual internship contribution.
On June 23, 2021, the Mayor and City Commission adopted Resolution No. 2021-31754,
approving Amendment No. 4 to the Agreement providing for the management and maintenance,
by Global, of Collins Canal Park, the two (2) clubhouse buildings formerly known as the Carl
Fisher Clubhouse and Little Stage Theaters, and Pride Park, including the mangroves along
Collins Canal with the footprint of the park. The amendment also provided for an additional
annual fee of seventy-five thousand dollars ($75,000) in consideration of the additional scope,
and extended the term of the Agreement to March 31, 2024. Because the agreement was
extended for 18 months, this extension resulted in the misalignment of the term of the
Agreement with the City's fiscal year. o
In June 2022, Global notified the City of a merger between Global and Oak View Group and in
August 2022, Global notified the City of its intent to operate and manage the Miami Beach
Convention Center under the fictitious name"OVG360".
ANALYSIS
International and domestic conventions, conferences and destination meetings are returning to
pre-COVI D-19 pandemic levels. To ensure continuity of the management and oversight of the
Miami Beach Convention Center, particularly in view of the anticipated construction and opening
of the convention center hotel, it is critical to create symmetry amongst the convention center-
related management, operations and sales agreements during the upcoming critical period of
reputation growth.
Among its various responsibilities, OVG360 is charged with marketing, promoting, and booking
clients at the Miami Beach Convention Center, often in collaboration with the Greater Miami
Convention and Visitors Bureau (GMCVB). The GMCVB's contractual relationship with the City
is aligned with the City's fiscal year and includes a major focus on Miami Beach Convention
Center sales, bookings, and destination marketing.
The Miami Beach Convention Center is serviced by exclusive food and beverage provider
Sodexo Live! (previously known as Centerplate). The term of the Sodexo Live! agreement is
based on the City's fiscal year.
It is the Administration's recommendation to approve Amendment No. 5 to the Agreement to
extend the term by six (6) months, to align with the related Sodexo Live! and GMCVB
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agreements. Accordingly, the amended term of the Agreement will commence on April 1, 2024
and expire on September 30, 2024.
Tangentially, following a competitive solicitation process (ITN 2023-338-ND) and pursuant to
Resolution No. 2023-32722 adopted on September 13, 2023, the Administration is currently
negotiating an agreement with OVG360 for management and operation of the Miami Beach
Convention Center campus. Within the proposed extension period the Administration intends to
recommend the Mayor and Commission review and approve a new management agreement. If
approved, the agreement would commence on October 1, 2024 and operate concurrent with the
City of Miami Beach fiscal year.
Although OVG360 was the sole awardee pursuant to ITN 2023-338-ND, as the six (6) month
extension resulting from the proposed Amendment No. 5 is not pursuant to the procurement
award, the Administration recommends a waiver, by 5/7th vote of the competitive bidding
requirement in Section 2-367(e)of the City Code.
SUPPORTING SURVEY DATA
Based on the 2022 Miami Beach Community Survey, 84.1% of local businesses think the
MBCC contributes positively to the overall value of doing business in Miami Beach.
FINANCIAL INFORMATION
Nationally, convention centers typically operate with a financial subsidy while providing a broader
indirect economic impact to the community, through tourism and hospitality-related visitor
spending. The MBCC is supported and funded by revenue generated by the MBCC (including
rentals, food, and beverage sales), Resort Tax (Convention Development Tax), and Miami
Beach Redevelopment Agency (RDA) tax increment revenue. The management fee (currently
at approximately$363,000 annually) is subject to annual increases based on the lesser of three
(3) percent or the consumer price index (CPI). Operating expenses related to managing,
maintaining, promoting, and marketing the MBCC (including personnel expenses)are funded by
the City. Operating revenues offset operating expenses.
This amendment does not contemplate any changes to the existing financial terms of the
Management Agreement. Funding is currently budgeted and allocated for this purpose. The
forthcoming MBCC management agreement, to be presented at a later date, is intended to
continue generating revenue for the City, with the selected management firm, OVG360,
compensated on an agreed-upon, fixed management fee with incentive fees based on
performance.
CONCLUSION
The Administration recommends that the City Commission approve Amendment No. 5 to the
Agreement to align the Agreement term with the City's fiscal year. As set forth above,
Amendment No. 5 requires a waiver of the competitive bidding as described in Section 2-
367(e)of the City Code. The Administration recommends approval finding such waiver to be in
the best interest of the City.
Applicable Area
South Beach
Is this a"Residents Right Does this item utilize G.O.
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to Know" item. pursuant to Bond Funds?
City Code Section 2-14?
No No
Strategic Connection
Prosperity-Develop the Convention Center campus.
Legislative Tracking
Economic Development
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