HomeMy WebLinkAbout719-2025 RDA RESOLUTION NO. 719-2025
A RESOLUTION OF THE CHAIRPERSON AND MEMBERS OF THE MIAMI
BEACH REDEVELOPMENT AGENCY (RDA), AUTHORIZING THE EXECUTIVE
DIRECTOR TO NEGOTIATE AMENDMENT NO. 3 (AMENDMENT) TO THE
LEASE AGREEMENT BETWEEN THE RDA (LANDLORD) AND CUBICHE 105,
LLC (TENANT), FOR USE OF APPROXIMATELY 7,130 SQUARE FEET OF
GROUND FLOOR RETAIL SPACE AT THE ANCHOR SHOPS AND GARAGE,
LOCATED AT 1555 WASHINGTON AVE, SUITES 1-3 (PREMISES), AS A FULL
SERVICE RESTAURANT; SAID AMENDMENT (I) ADJUSTING TENANT'S
MONTHLY RENT SCHEDULE TO TEN PERCENT (10%) OF GROSS SALES
PLUS PROPERTY OPERATING EXPENSES IN LIEU OF THE BASE RENT FOR
A PERIOD OF FOUR (4) YEARS, FROM JANUARY 1, 2026 THROUGH
DECEMBER 31, 2029, TO ADDRESS TENANT'S FINANCIAL CONSTRAINTS
AND TO FACILITATE PLANNED RENOVATIONS; AND (II) REMOVING ANY
ADDITIONAL RENEWAL PERIODS UNDER THE LEASE; AND FURTHER,
AUTHORIZING THE EXECUTIVE DIRECTOR AND SECRETARY TO EXECUTE
THE FINAL AMENDMENT.
WHEREAS, on December 28, 2015, the Miami Beach Redevelopment Agency ("Landlord")
entered into a retail Lease Agreement with Cubiche 105, LLC ("Tenant")for a full-service restaurant
at the Anchor Shops and Garage, located at 1555 Washington Avenue, Suite Nos. 1-3; and
WHEREAS, as corrected by Amendment No. 2, the Initial Lease Term runs through
December 31, 2025, followed by two five-year renewal options; and
WHEREAS, during the COVID-19 period, the parties executed Amendment No. 1 to provide
temporary relief by replacing Minimum Rent with a percentage-rent structure and offering a limited
abatement, while the Tenant continued to pay Operating Expenses; and
WHEREAS, as operations stabilized, Amendment No. 2 resolved pending litigation, aligned
the lease commencement and expiration dates, restarted Operating Expense adjustments beginning
in 2024, and set the rent terms for the balance of the Initial Lease Term and the renewal periods,
including Minimum Rent escalation and percentage-rent thresholds; and
WHEREAS, on September 5, 2025, the Tenant delivered a Lease Renewal Letter confirming
its intention to exercise the first renewal term (First Renewal Option) commencing January 1, 2026,
and due to continued low foot traffic and weak sales along Washington Avenue, requested a rent
structure of ten percent (10%) of Gross Sales (as defined in the Lease) during the renewal period to
help manage cash flow and complete targeted renovations, while continuing to pay the Operating
Expenses; and
WHEREAS, under Amendment No. 2, the First Renewal Option term runs from January 1,
2026 through December 31, 2030, with rent defined as the greater of (i) Minimum Rent at $45.00
per square foot with a 3% annual increase starting January 1, 2027 ("Base Rent"), or(ii) Percentage
Rent at 11% of Gross Sales, increasing to 12.5% above the stated breakpoint; and
WHEREAS, the Executive Director recommends negotiating and executing an amendment
to the Lease (Amendment No. 3) to (i) adjust Tenant's monthly rent schedule to ten percent (10%)
of Gross Sales plus property Operating Expenses in lieu of the Base Rent for a period of four (4)
years, from January 1, 2026 through December 31, 2029, to address Tenant's financial constraints
and to facilitate planned renovations, with the expectation that traffic will grow substantially once the
Tax Collector's Office opens at Anchor Shops and Garage; and (ii) remove any additional renewal
periods under the Lease; and
WHEREAS, all other Lease provisions, including Tenant's responsibility to pay for its share
of property Operating Expenses, will continue to apply without modification; and
WHEREAS, upon conclusion of Amendment No. 3, the Lease would expire and the City and
Tenant could negotiate new terms going forward under a new Lease Agreement to be effective
January 1, 2030, but neither party would have any obligation to enter into a new Lease Agreement.
NOW, THEREFORE, BE IT DULY RESOLVED BY THE CHAIRPERSON AND MEMBERS
OF THE MIAMI BEACH REDEVELOPMENT AGENCY (RDA), that the Chairperson and Members
of the RDA hereby authorize the Executive Director to negotiate Amendment No. 3 (Amendment) to
the Lease Agreement between the RDA (Landlord) and Cubiche 105, LLC (Tenant), for use of
approximately 7,130 square feet of ground floor retail space at the Anchor Shops and Garage,
located at 1555 Washington Avenue, Suites 1-3, as a full service restaurant; said Amendment (i)
adjusting Tenant's monthly rent schedule to ten percent (10%) of Gross Sales plus property
Operating Expenses in lieu of the Base Rent for a period of four (4) years, from January 1, 2026
through December 31, 2029, to address Tenant's financial constraints and to facilitate planned
renovations; and (ii) removing any additional renewal periods under the Lease; and further, authorize
the Executive Director and Secretary to execute the final Amendment.
PASSED and ADOPTED this /7 day of pea Alber'' 2025.
ATTEST:
Rafael E. ran Ai — .
ado, Secretary Steven Meiner, Chairperson
APPROVED AS TO
FORM&LANGUAGE
&FOR EXECUTION
"------L"' ) 2/191 W1
General'Counsel4 Date
Redevelopment Agency Items (RDA) 1
MIAMI BEACH
COMMISSION MEMORANDUM
TO: Honorable Mayor and Members of the City Commission
FROM: Eric Carpenter, Executive Director
DATE: December 17, 2025
TITLE: A RESOLUTION OF THE CHAIRPERSON AND MEMBERS OF THE MIAMI BEACH
REDEVELOPMENT AGENCY (RDA), APPROVING, IN SUBSTANTIAL FORM.
AMENDMENT NO. 3 (AMENDMENT) TO THE LEASE AGREEMENT BETWEEN
THE RDA (LANDLORD), AND CUBICHE 105, LLC (TENANT), FOR USE OF
APPROXIMATELY 7,130 SQUARE FEET OF GROUND FLOOR RETAIL SPACE
AT THE ANCHOR SHOPS AND GARAGE, LOCATED AT 1555 WASHINGTON
AVE, SUITE NOS. 1-3 (PREMISES), AS A FULL SERVICE RESTAURANT, SAID
AMENDMENT ADJUSTING TENANT'S RENT SCHEDULE TO TEN PERCENT
(10%) OF GROSS SALES IN LIEU OF THE CURRENT TRIPLE NET RENTS FOR
A PERIOD OF FOUR (4) YEARS, FROM JANUARY 1, 2026 THROUGH
DECEMBER 31, 2029. WITH ALL OTHER LEASE TERMS TO REMAIN IN EFFECT.
TO ADDRESS TENANT'S FINANCIAL CONSTRAINTS AND TO FACILITATE
PLANNED RENOVATIONS: AND CLARIFYING THAT TENANT'S RENEWAL OF
THE LEASE TERM AS OF JANUARY 1. 2026 IS CONTINGENT UPON APPROVAL
OF THE PROPOSED PERCENTAGE RENT STRUCTURE: AND FURTHER,
AUTHORIZING THE EXECUTIVE DIRECTOR TO FINALIZE THE AMENDMENT;
AND FURTHER, AUTHORIZING THE EXECUTIVE DIRECTOR AND SECRETARY
TO EXECUTE THE AMENDMENT.
RECOMMENDATION
The Administration recommends the Chairperson and Members of the RDA hereby approves, in
substantial form, Amendment No. 3 to the Lease Agreement.
BACKGROUND/HISTORY
On December 28. 2015, the Miami Beach Redevelopment Agency ("Landlord") entered into a
retail Lease Agreement with Cubiche 105. LLC ("Tenant") for a full-service restaurant at the
Anchor Shops and Garage, located at 1555 Washington Avenue, Suite Nos. 1-3. As corrected
by Amendment No. 2, the Initial Lease Term runs through December 31, 2025, followed by two
five-year renewal options.
During the COVID-19 period, the parties executed Amendment No. 1 to provide temporary relief
by replacing Minimum Rent with a percentage-rent structure and offering a limited abatement,
while the Tenant continued to pay Operating Expenses.
As operations stabilized, Amendment No. 2 resolved pending litigation, aligned the lease
commencement and expiration dates, restarted Operating Expense adjustments beginning in
2024, and set the rent terms for the balance of the Initial Lease Term and the renewal periods,
including Minimum Rent escalation and percentage-rent thresholds.
On September 5, 2025, the Tenant delivered a Lease Renewal Letter confirming its intention to
exercise the First Renewal Option commencing January 1, 2026, and, in connection with the
renewal, due to continued low foot traffic and weak sales along Washington Avenue, requested
a rent structure of ten percent (10%) of Gross Sales during the renewal period to help manage
3370 of 3458
cash flow and complete targeted renovations..
ANALYSIS
Under Amendment No. 2, the First Renewal Option term runs from January 1, 2026 through
December 31, 2030, with rent defined as the greater of Minimum Rent at $45.00 per square foot
with a 3% ann_ -LI increase starting January 1, 2026, estimated to total $651,325.50 over the two-
year period, or Percentage Rent at 11% of Gross Sales, increasing to 12.5% above the stated
breakpoint. All other lease provisions including use, insurance, reporting, construction standards,
and lien protections will continue to apply without modification, and any planned renovations will
proceed within that framework and in strict compliance with the Lease.
Due to the continued struggles of low foot traffic and weak sales along Washington Avenue, the
Tenant's projected sales are not at a level that would allow them to pay the triple net rent structure
as planned. The Tenant is requesting Amendment No. 3 to the Lease, which would replace the
rental structure approved in Amendment No. 2 and allow the Tenant to pay ten percent (10%) of
gross sales for four (4) years (January 1, 2026 — December 31, 2029) with the expectations that
traffic will grow substantially once the Tax Collector's Office opens at Anchor Shops and Garage
(such opening projected for 2026). All other terms and conditions of the Lease remain the same.
The projected rent comparison for the first year (2026) schedule is as follows:
Projected Gross Sales Minimum Gross Sates Vs. Projected 2026
Date Sates 10% Rent($45)PSF 2026 Full Rent Variance
Jan-26 $ 136,000.00 $ 13,600.00 $ 26,737.50 $ (13,137.50)
Feb-26 $ 150,000.00 $ 15,000.00 S 26,737.50 S (11,737.50)
Mar-26 S 120,000.00 $ 12,000.00 S 26,r3/.50 S (14,737.50)
Apr-26 S 119,000.00 $ 11,900.00 S 26,737.50 $ (14,837.50)
May-26 $ 105,000.00 $ 10,500.00 $ 26,737.50 $ (16,237.50)
Jun-26 $ 88,000.00 $ 8,800.00 $ 26,737.50 $ (17,937.50)
Jul-26 $ 85,000.00 $ 8,500.00 S 26,737.50 $ (18,237.50)
Aug-26 $ 65,000.00 $ 6,500.00 $ 26.737.50 $ (20.237.50)
Sep-26 $ 76,000.00 $ 7,600.00 S 26.737.50 S (19,137.50)
Oct-26 $ 72,000.00 $ 7,200.00 S 26,737.50 S (19,537.50)
Nov-26 $ 85,000.00 $ 8,500.00 S 26,737.50 $ (18,237.50)
Dec-26 $ 150,000.00 $ 15,000.00 $ 26,737.50 S (11,737.50)
Total S 125,100.00 $ 320,850.00 $ (195,750.00) $ (195,750.00)
The proposed amendment reflects a practical response to the Tenant's current financial
constraints and planned renovations. The requested four-year percentage rent structure would
provide stability to facilitate Tenant's improvements to the Premises.
Granting a temporary percentage rent structure of 10% Gross Sales from January 1, 2026,
through December 31, 2029, aligns lease obligations with the anticipated Premise improvements
and supports the continued operation of a full-service restaurant at the Anchor Shops and Garage.
It will also allow the City to assist a long-term Tenant to keep their lights on during these times of
struggle and upon the conclusion of Amendment No. 3, the City and Tenant would negotiate new
terms going forward under a new Lease Agreement to be effective January 1, 2030, but neither
party would have any obligation to enter into such a new Lease Agreement.
FISCAL IMPACT STATEMENT
3371 of 3458
N/A
Does this Ordinance require a Business Impact Estimate?
(FOR ORDINANCES ONLY)
If applicable, the Business Impact Estimate (BIE) was published on:
See BIE at: https://www.miamibeachfl.yov/city-hall/city-clerk/meeting-notices/
FINANCIAL INFORMATION
CONCLUSION
The Administration recommends the Chairperson and Members of the RDA hereby approves, in
substantial form, Amendment No. 3 to the Lease Agreement between the RDA (Landlord) and
Cubiche 105, LLC (Tenant), adjusting Tenant's monthly rent schedule to ten percent (10%) of
Gross Sales in lieu of the current triple net rent terms for a period of four (4) years, from January
1, 2026 through December 31, 2029.
Applicable Area
South Beach
Is this a "Residents Right to Know" item, Is this item related to a G.O. Bond
pursuant to City Code Section 2-17? Project?,
No No
Was this Agenda Item initially requested by a lobbyist which, as defined in Code Sec. 2-481,
includes a principal engaged in lobbying? No
If so, specify the name of lobbyist(s) and principal(s):
Department
Facilities and Fleet Management
Sponsor(s)
Co-sponsor(s)
Condensed Title
Approve Amendment 3 to Cubiche 105, LLC at 1555 Washington Ave, Adjust Rent to 10%. FF
Previous Action (For City Clerk Use Only)
3372 of 3458
September 5,2025
The Miami Beach Redevelopment Agency
1700 Convention Center Drive
Miami Beach,FL 33139
Re: Notice of Exercise of First Renewal Option
To sthom it may concern:
Please be advised that it is Cubiche 105,LLC's intent to renew that certain Lease dated
December 28,2015,pending approval by the City of Miami Beach to the 24-month rental
abatement and percentage rent discussed between the parties. This confirms that,as discussed,
the date in Paragraph 2 of the Amendment No.2 to Lease is extended to October 29,2025,so
that the new lease terms may be approved by the City at the next commission meeting on that
date.
Sincerely,
6w1)an Suarez
Cubiche 105,LLC
3376 of 3458 CamScanner