HomeMy WebLinkAboutResolution 2026-34069 RESOLUTION NO. 2026-34069
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE
CITY OF MIAMI BEACH, FLORIDA, APPROVING THE MATERIAL
TERMS OF A PROPOSED SETTLEMENT AGREEMENT BETWEEN
THE CITY AND BALLET VALET PARKING COMPANY, LTD. ("BV") IN
SETTLEMENT OF A LAWSUIT FILED BY BV AGAINST THE CITY ON
MARCH 10, 2025 IN THE CIRCUIT COURT OF THE ELEVENTH
JUDICIAL CIRCUIT IN AND FOR MIAMI-DADE COUNTY, FLORIDA,
CASE NO. 2025-006551-CA-01, WHICH SETTLEMENT AGREEMENT
WOULD (1) REQUIRE THE CITY TO COMPLETE CERTAIN REPAIRS
TO THE MUNICIPAL GARAGE LOCATED AT 7TH STREET AND
COLLINS AVENUE AND (2) MODIFY THE TERMS OF BV'S OPTION TO
PURCHASE THE CITY'S INTERESTS IN THE GARAGE; AND
FURTHER, AUTHORIZING THE CITY MANAGER TO NEGOTIATE AND
FINALIZE THE SETTLEMENT AGREEMENT CONSISTENT WITH THE
MATERIAL TERMS REFLECTED IN THIS RESOLUTION AND IN A
FORM ACCEPTABLE TO THE CITY ATTORNEY; AND FURTHER,
AUTHORIZING THE CITY MANAGER AND CITY CLERK TO EXECUTE
THE SETTLEMENT AGREEMENT.
WHEREAS, the 7th Street Parking Garage is a mixed-use parking facility located
at 7th Street and Collins Avenue in the South Beach area; and
WHEREAS, the property consists of a multi-level structured garage containing 646
parking spaces, along with a ground-floor retail component that was incorporated into the
original project design; and
WHEREAS, the facility was developed as a combined parking and retail project,
with shared structural and operational elements governed by a series of related
agreements between the City of Miami Beach and the private developer, The Ballet Valet
Parking Company, Ltd. ("BV"); and
WHEREAS, the development of the garage originated with the City's issuance of
RFP/RFLI No. 18-92/93 in December 1992, which sought proposals to develop parking
facilities in the South Beach area.
WHEREAS, following review by a selection committee and subsequent
Commission direction, the City Commission authorized the Administration in July 1993 to
negotiate a development agreement with BV for a parking project at 7th Street and Collins
Avenue; and
WHEREAS, on March 30, 1994, the City Commission approved an Acquisition,
Construction, and Development Agreement among the City, BV, and the MacCarthy
Brothers Company; and
WHEREAS, the agreement established the framework for construction of the
garage and retail space, the allocation of land and air rights, operational responsibilities,
and the inclusion of a future purchase option held by the private party; and
WHEREAS, in addition to the development agreement, the parties entered into
related agreements governing parking operations, maintenance obligations(Maintenance
Agreement), and management responsibilities for the facility.
WHEREAS, collectively, these agreements defined the City's role in operating and
maintaining the parking structure and BV's role in managing the retail component, as well
as the financial and operational relationship between the parties over the life of the
project; and
WHEREAS, since the garage opened, the City has operated and maintained the
parking facility in accordance with these agreements and has expended millions of dollars
in capital investment related to structural repairs, drainage improvements, electrical work,
and other capital projects undertaken over time as part of its ongoing obligations; and
WHEREAS, under the current agreement structure, BV holds a purchase option
for the City's interest in the garage; and
WHEREAS, that option becomes exercisable on February 26, 2026, at which time
the option holder has 30 days to exercise the option; and
WHEREAS, upon exercise, the governing agreements provide for a 180-day
period to complete the closing; and
WHEREAS, on March 10, 2025, BV—represented by Etan Mark and the law firm
of Mark Ferrer & Hayden—filed a lawsuit against the City in the Circuit Court of the
Eleventh Judicial Circuit in and for Miami-Dade County, Florida, Case No. 2025-006551-
CA-01 (the "Lawsuit"); and
WHEREAS, in the Lawsuit, BV seeks (1) breach-of-contract monetary damages,
(2) specific performance, and (3) damages for breach of the implied covenant of good
faith and fair dealing, all arising from the City's alleged failure to adequately maintain the
Garage; and
WHEREAS, BV asserts that its damages include "the cost of repairing damages
to the Retail Space caused by the City's breach of the Maintenance Agreement, revenue
loss, compensation for the substantial decline in value to the Retail Space, and
devaluation of BV's future interest in the Garage." And as to specific performance of the
Maintenance Agreement, BV alleges that the City should be required to undertake
"millions of dollars of work" to restore the Garage to a "first-class retail/garage building.";
and
WHEREAS, pursuant to the Lawsuit, the City and BV were required to engage in
Court-ordered mediation in efforts to reach an amicable settlement; and
2
WHEREAS, all discussions related to that mediation are confidential under
Florida's mediation privilege; and
WHEREAS, the ultimate result of the mediation was to present to the City
Commission the material terms of the proposed settlement, which, if approved, will be
negotiated into a more fulsome settlement agreement; and
WHEREAS, the proposed settlement terms address all claims in the lawsuit and,
if the settlement terms are approved by the Mayor and City Commission, the City would
agree in the settlement agreement to complete repairs that have already been budgeted
for and commenced in the approximate amount of $1,996,000, of which approximately
$580,602 has been completed and paid for and $1,415,398 is committed; and
WHEREAS, the proposed terms of the settlement agreement would also modify
the terms of BV's purchase option, comparing the existing purchase option terms
pursuant to the Acquisition, Construction and Development Agreement and the new terms
negotiated during the mediation as part of the overall settlement of BV's lawsuit; and
WHEREAS, the proposed material terms of the Settlement Agreement are
attached as Exhibit "A" to this Resolution and incorporated herein.
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 approve the material terms of a proposed settlement agreement
between the City and Ballet Valet Parking Company, Ltd. ("BV") in settlement of a lawsuit
filed by bv against the City on March 10, 2025 in the Circuit Court of the Eleventh Judicial
Circuit in and for Miami-Dade County, Florida, Case No. 2025-006551-CA-01, which
settlement agreement would (1) require the City to complete certain repairs to the
municipal garage located at 7th street and Collins Avenue and (2) modify the terms of
BV's option to purchase the City's interests in the garage; and further, authorizing the City
Manager to negotiate and finalize the settlement agreement consistent with the material
terms reflected in this resolution and in a form acceptable to the CityAttorney; and further,
authorizing the City Manager and City Clerk to execute the settlement agreement.
PASSED AND ADOPTED this 5 day of �� �ruG"y , 2026.
ATTEST:
FEB 1 9 2026 Steven Meiner, Mayor
City Clerk APPROVED AS TO
Rafael . Granado, FORM &LANGUAGE
8�FOR EXECUTION
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Exhibit "A"
Subject Matter Article IX(Development Agreement) (Material Mediated Settlement Terms)
Option Grant&Timing Option exercisable 30 years after Garage opens Option exercisable within 1 year from final
OR after City financing retired; the date on which appraisal determination; closing allowed
BV may exercise the option is February 26,2026. up to 3 years from settlement agreement
Pursuant to the terms of the Development date.
Agreement, BV must exercise the option within
30 days and closing must occur within 180
da s.
Purchase Price Basis Fair market value based on highest and best use Fair market value with a floor of$12.435M
+ Accumulated Deficit (NOTE: there is currently and a ceiling of $37M; appraisers must
no Accumulated Deficit as garage revenues have assume privately operated garage (as
covered all ex enses . o osed to munici al ara e .
Appraisal Process Two appraisals; third if >20% variance; average Two jointly selected appraisers; third, if
of two or three; BV pays costs. City selects the >20% variance, chosen by first two; no
a raisers sub�ect to BV's reasonable a roval. rior a raisers allowed.
Appraisal Timing No specific timeline for appraisal completion. Appraisers retained within 30 days of
settlement agreement execution; FMV
determined within 90 da s.
Price Escalation Not adtlressed. The final appraised value will be
escalatetl 0.33% per month starting 120
da s after last a raisal com leted.
Inspection Rights BV has 40-day inspection period after Option No change.
Notice; intlemnit re uired.
Credits 1 Adjustments No credits; purchase is AS IS. Credits for unfinished work (100% if
closing is before 12/31/26; 150% after);
additional $3M credit for omitted
facatle/elevator work.
Closing Conditions Closing in Dade County, FL; BV pays all costs; No change but includes credits and
property conveyed free of liens except those escalations.
created b BV.
Termination of Option Terminates if BV fails to exercise or close timely, Governed by settlement timelines
or if BV sells/transfers interest reducing Anthony (exercise within 1 year, close within 3
Goltlman's heirs' majority ownership. years); same ownership condition
a lies.
Continued Operation as a Not addressed. BV agrees to maintain the property as a
Garage garage and honor resident transient
arkin rates throu h Februa 27, 2031
BV Spaces in Garage BV pays for 162 spaces at current monthly rate City to provide 162 spaces at no cost for
($132/space) a 12-month period from the date of the
settlement a reement
Ramp agreement Extended for 3 adtlitional years under
existin terms
Parking Lease Agreement Deadline to exercise option to extend will
be same as deadline to exercise
urchase o tion
Resolutions - C7 I
MIAMIBEACH
COMMISSION MEMORANDUM
TO: Honorable Mayor and Members of the City Commission
FROM: Eric Carpenter, City Manager
DATE: February 5, 2026
TITLE A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF
MIAMI BEACH, FIORIDA, APPROVING THE MATERIAL TERMS OF A
PROPOSED SETTLEMENT AGREEMENT BETWEEN THE CITY AND BALLET
VALET PARKING COMPANY, LTD. ("BV") IN SETTLEMENT OF A LAWSUIT
FILED BY BV AGAINST THE CITY ON MARCH 10, 2025 IN THE CIRCUIT COURT
OF THE ELEVENTH JUDICIAL CIRCUIT IN AND FOR MIAMI-DADE COUNTY,
FLORIDA, CASE NO. 2025-006551-CA-01, WHICH SETTLEMENT AGREEMENT
WOULD (1) REQUIRE THE CITY TO COMPLETE CERTAIN REPAIRS TO THE
MUNICIPAL GARAGE LOCATED AT 7T" STREET AND COLLINS AVENUE AND
(2) MODIFY THE TERMS OF BV'S OPTION TO PURCHASE THE CITY'S
INTERESTS IN THE GARAGE; AND FURTHER, AUTHORIZING THE CITY
MANAGER TO NEGOTIATE AND FINALIZE THE SETTLEMENT AGREEMENT
CONSISTENT WITH THE MATERIAL TERMS REFLECTED IN THIS
RESOLUTION AND IN A FORM ACCEPTABLE TO THE CITY ATTORNEY; AND
FURTHER, AUTHORIZING THE CITY MANAGER AND CITY CLERK TO
EXECUTE THE SETTLEMENT AGREEMENT.
RECOMMENDATION
It is recommended that the Mayor and City Commission of the City of Miami Beach adopt the
Resolution.
BACKGROUND/HISTORY
The 7th Street Parking Garage is a mixed-use parking facility located at 7th Street and Collins
Avenue in the South Beach area. The properry consists of a multi-level structured garage
containing 646 parking spaces, along with a ground-floor retail component that was incorporated
into the original project design. The facility was developed as a combined parking and retail
project, with shared structural and operational elements governed by a series of related
agreements between the City of Miami Beach and the private developer, The Ballet Valet Parking
Company, Ltd. ("BV").
The development of the garage originated with the City's issuance of RFP/RFLI No. 18-92/93 in
December 1992, which sought proposals to develop parking facilities in the South Beach area.
Following review by a selection committee and subsequent Commission direction, the City
Commission authorized the Administration in July 1993 to negotiate a development agreement
with BV for a parking project at 7th Street and Collins Avenue. On March 30, 1994, the City
Commission approved an Acquisition, Construction, and Development Agreement among the
City, BV, and the MacCarthy Brothers Company. That agreement established the framework for
construction of the garage and retaif space, the allocation of land and air rights, operational
responsibilities, and the inclusion of a future purchase option held by the private paRy.
302 of 2180
In addition to the development agreement, the parties entered into related agreements governing
parking operations, maintenance obligations (Maintenance Agreement), and management
responsibilities for the facility. Collectively, these agreements defined the City's role in operating
and maintaining the paricing structure and BV's role in managing the retail component, as well as
the financial and operational relationship between the parties over the life of the project. Since
the garage opened, the City has operated and maintained the parking facility in accordance with
these agreements and has expended millions of dollars in capital investment related to structural
repairs, drainage improvements, electrical work, and other capital projects undertaken over time
as part of its ongoing obligations.
Under the current agreement structure, BV holds a purchase option for the City's interest in the
garage. That option becomes exercisable on February 26, 2026, at which time the option holder
has 30 days to exercise the option. Upon exercise, the governing agreements provide for a 180-
day period to complete the closing.
ANALYSIS
On March 10, 2025, BV—represented by Etan Mark and the law firm of Mark Ferrer& Hayden—
filed a lawsuit against the City in the Circuit Court of the Eleventh Judicial Circuit in and for Miami-
Dade County, Florida, Case No. 2025-006551-CA-01 (the "LawsuiY'). In the Lawsuit, BV seeks
(1) breach-of-contract monetary damages, (2} specific performance, and (3) damages for breach
of the implied covenant of good faith and fair dealing, all arising from the City's alleged failure to
adequately maintain the Garage.
BV asserts that its damages include "the cost of repairing damages to the Retail Space caused
by the City's breach of the Maintenance Agreement, revenue loss, compensation for the
substantial decline in value to the Retail Space, and devaluation of BV's future interest in the
Garage." And as to specific performance of the Maintenance Agreement, BV alleges that the City
should be required to undertake "millions of dollars of work" to restore the Garage to a "first-class
retail/garage building."
Pursuant to the Lawsuit, the City and BV were required to engage in Court-ordered mediation in
efforts to reach an amicable settlement. All discussions related to that mediation are confidential
under Florida's mediation privilege.
The ultimate result of the mediation was to present to the City Commission the material terms of
the proposed settlement, which, if approved, will be negotiated into a more fulsome settlement
agreement. The proposed settlement terms address all claims in the lawsuit and, if the settlement
terms are approved by the Mayor and City Commission, the City would agree in the settlement
agreement to complete repairs that have already been budgeted for and commenced in the
approximate amount of $1,996,000, of which approximately $580,602 has been completed and
paid for and $1,415,398 is committed.
The proposed terms of the settlement agreement would also modify the terms of BV's purchase
option. Below is a table comparing, as applicable, the existing purchase option terms pursuant
to the Acquisition, Construction and Development Agreement and the new terms negotiated
during the mediation as part of the overall settlement of BV's lawsuit.
303 of 2180
Subject Matter Article IX (Development (Material Mediated
Agreement) Settlement Terms)
Option Grant 8 Timing Option exercisable 30 years Option exercisable within 1
after Garage opens OR year from final appraisal
after City financing retired; determination; closing
the date on which BV may allowed up to 3 years from
exercise the option is settlement agreement date.
February 26, 2026.
Pursuant to the terms of the
Development Agreement,
BV must exercise the
option within 30 days and
closing must occu�within
180 days.
Purchase Price Basis Fair market value based on Fair market value with a
highest and best use + floor of $12.435M and a
Accumulated Deficit ceiling of $37M; appraisers
(NOTE: there is currently no must assume privately
Accumulated Deficit as operated garage (as
garage revenues have opposed to municipal
covered all expenses). garage).
Appraisal Process Two appraisals; third if Two jointly selected
>20% variance; average of appraisers; third, if >20%
two or three; BV pays costs. variance, chosen by first
City selects the appraisers two; no prior appraisers
subject to BV's reasonable allowed.
approval.
Appraisal Timing No specific timetine for Appraisers retained within
appraisal completion. 30 days of settlement
agreement execution; FMV
determined within 90 days.
Price Escalation Not addressed. The final appraised value
will be escalated 0.33% per
month starting 120 days
after last appraisal
completed.
Inspection Rights BV has 40-day inspection No change.
period after Option Notice;
indemnity required.
Credits / Adjustments No credits; purchase is AS Credits for unfinished work
IS. (100% if closing is before
12131126; 150% after);
additional $3M credit for
omitted facade/elevator
work.
Closing Conditions Closing in Dade County, No change but includes
FL; BV pays all costs; credits and escalations.
property conveyed free of
liens except those created
by BV.
Termination of Option Terminates if BV fails to Governed by settlement
exercise or close timely, or timelines (exercise within 1
0
if BV sells/transfers interest year, ciose within 3 years);
reducing Anthony same ownership condition
Goldman's heirs� majority applies.
ownership.
Continued Operation as a Not addressed BV agrees to maintain the
Garage property as a garage and
honor resident transient
parking rates through
February 27, 2031
BV Spaces in Garage BV pays for 162 spaces at City to provide 162 spaces
current monthly rate at no cost for a 12-month
($132lspace) period from the date of the
settlement agreement
Ramp agreement Extended for 3 additional
years under existing terms
Parking Lease Deadline to exercise option
Agreement to extend will be same as
deadline to exercise
purchase option
Based on the foregoing, the Administration believes it is in the best interest of the City to
authorize the City Manager to negotiate and execute a settlement agreement with BV to settle
all claims in the Lawsuit and include amendments to the existing agreements governing the 7'�
Street Parking Garage, within the material terms and framework set forth in this memorandum,
and subject to City Attorney approval.
FISCAL IMPACT STATEMENT
Nf'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.govJcity-hall/city-clerklmeetinq-notices/
FINANCIAL INFORMATION
N/A
CONCLUSION
It is recommended that the Mayor and City Commission of the City of Miami Beach adopt the
Resolution.
Applicable Area
South Beach
Is this a "Residents Ri�ht to Know" item, Is this item related to a G.O. Bond
pursuant to City Code Section 2-17? Proiect?
305 of 2180
Yes No
Was this Aqenda Item initially requested bv a lobbyist which, as defined in Code Sec. 2-481,
includes a principal enqaqed in lobbving? No
If so, specify the name of lobbyist(s) and principal(s):
Depa�tment
Parking
Sponsor(s)
Co-sponsor(s)
Condensed Title
Amend Agreement Governing the 7th Street Parking Garage. PK
Previous Action (For City Clerk Use Only)
306 of 2180