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HomeMy WebLinkAbout2006-26171 Reso ~'- RESOLUTION NO. 2006-26171 A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, FOLLOWING A DULY NOTICED PUBLIC HEARING TO OBTAIN CITIZEN INPUT ON SAME, APPROVING AND AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE A LEASE AGREEMENT BETWEEN THE CITY AND MANPRIY A, INC., FOR THE LEASE OF APPROXIMATELY 2080 SQUARE FEET OF CITY-OWNED PROPERTY, LOCATED AT 22 WASHINGTON AVENUE, MIAMI BEACH, FLORIDA, FOR THE PURPOSE OF AN OUTDOOR CAFE ASSOCIATED WITH A RESTAURANT OPERATION LOCATED AT 816 COMMERCE STREET, WHICH IS DIRECTLY ADJACENT TO AND WEST OF THE SUBJECT CITY PROPERTY; SAID LEASE HAVING AN INITIAL TERM OF FIVE YEARS, WITH AN OPTION TO RENEW FOR FOUR YEARS AND 364 DAYS, AT THE CITY'S DISCRETION; FURTHER WAIVING, BY SmHS VOTE, THE COMPETITIVE BIDDING AND APPRAISAL REQUIREMENTS, AS REQUIRED BY SECTION 82-39 OF THE MIAMI BEACH CITY CODE WHEREAS, the City and Manpriya, Inc. have negotiated a five (5) year lease, with an option to renew for an additional four (4) years and three hundred sixty four (364) days, at the City's sole discretion, for the use of approximately 2080 square feet of vacant City-owned property located at 22 Washington Avenue (the Property) for an outdoor cafe associated with a restaurant operation located at 816 Commerce Street, which is directly adjacent to and west of the Property; and WHEREAS, Section 82-39 of the Miami Beach City Code, governing the sale/lease of public property, requires a public bidding process, a Planning Department analysis, and an independent appraisal to determine the value of the leasehold interest; as well as a public hearing to obtain citizen input; and WHEREAS, on March 8, 2006, the Mayor and City Commission adopted Resolution No. 2006-26148 setting a Public Hearing on April 11, 2006, to hear public comment regarding the proposed Lease Agreement; and WHEREAS, on March 15, 2006, the City's Planning Department submitted the required analysis, attached hereto, recommending that the Lease include a provision prohibiting outdoor speakers from being attached to the exterior of the restaurant building or placed in any manner in the outdoor cafe area; and WHEREAS, Section 82-39 of the City Code further provides for the waiver of the competitive bidding and appraisal requirements, by 5/7ths vote of the Mayor and City Commission, for leases of City land, upon a finding by the Mayor and City Commission that the public interest would be served by waiving such conditions, and the Administration would hereby recommend that the Mayor and City Commission approve said waiver. 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 of the City of Miami Beach, Florida, following a duly noticed Public Hearing to obtain citizen input on same, hereby -~,- approve and authorize the Mayor and City Clerk to execute the attached Lease Agreement between the City and Manpriya, Inc., for the lease of approximately 2080 square feet of the City-owned property, located at 22 Washington Avenue, Miami Beach, Florida, for the purpose of an outdoor cafe associated with a restaurant operation located at 816 Commerce Street, which is directly adjacent to and west of the subject City property; said Lease having an initial term of five years, with an option to renew for four years and 364 days, at the City's discretion; further waiving, by 5/7ths vote, the competitive bidding and appraisal requirements, as required by Section 82-39 of the Miami Beach City Code. PASSED and ADOPTED this ~ day of ~, 2 ~tl~~ CIJY CLERK Robert Parcher JMG\RCM\rlr F:\DDH P\$ALL \ASSET\22 WASH INGTON\ManpriyaLease.RES.doc MAYOR David Dermer APPROVED AS TO FORM & LANGUAGE & FOR EXECUTION AM Jtv\1, ,!~ J" '),,.~ ~ Date COMMISSION ITEM SUMMARY Condensed Title: A resolution approving a lease agreement with Manpriya, Inc., for the lease of approximately 2080 square feet of City-owned property at 22 Washington Avenue, for the purpose of an outdoor cafe associated with a restaurant operation located at 816 Commerce Street; said lease having an initial term of five years, with an option to renew for four years and 364 days, at the City's discretion; further waiving, by 5/7ths vote, the com etitive biddin and a raisal re uirements. Ke Intended Outcome Su orted: Increase resident satisfaction with availability of commercial service options. Item Summary/Recommendation: The City and Manpriya, Inc. have negotiated a 5 year lease, with an option to renew for an additional 4 years and 364 days, for the use of approximately 2080 square feet of vacant City-owned property, located at 22 Washington Avenue, for an outdoor cafe associated with a restaurant operation located at 816 Commerce Street, which is directly adjacent to and west of the subject property. Salient terms and conditions outlined in attached Commission Memorandum. The subject property is the remaining portion of a lot that had been previously acquired by the City for the expansion of a portion of Washington Avenue (between Commerce Street and South Pointe Drive) which has already been completed, and the subject parcel does not readily lend itself for public use at this time. The Administration recommends that the Mayor and City Commission approve the lease agreement and waive the competitive bidding and appraisal requirements. Advisory Board Recommendation: I N/A Financial Information: Source of Amount Account Approved Funds: 1 D 2 3 4 OBPI Total Financial Impact Summary: Ci Clerk's Office Le islative Trackin Robert Middaugh / Asset Management Si n-Offs: Assistant City Manager City Manager T:\AGENDA \2006\apr11 06\Regular\ManpriyaLease .SUM .doc m "WI" MIAMI BEACH AGENDA ITEM DATE R1A I.{-/ / -OC:, It\ MIAMI BEACH City of Miami Beach, 1700 Convention Center Drive, Miami Beach, Florida 33139, www.miamibeachfl.gov COMMISSION MEMORANDUM FROM: Mayor David Dermer and Members of the City Commission Jorge M. Gonzalez, City Manager '1 April 11 , 2006 U TO: DATE: SUBJECT: A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, FOLLOWING A DULY NOTICED PUBLIC HEARING TO OBTAIN CITIZEN INPUT ON SAME, APPROVING AND AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE A LEASE AGREEMENT BETWEEN THE CITY AND MANPRIY A, INC., FOR THE LEASE OF APPROXIMATELY 2080 SQUARE FEET OF CITY-OWNED PROPERTY, LOCATED AT 22 WASHINGTON AVENUE, MIAMI BEACH, FLORIDA, FOR THE PURPOSE OF AN OUTDOOR CAFE ASSOCIATED WITH A RESTAURANT OPERATION LOCATED AT 816 COMMERCE STREET, WHICH IS DIRECTLY ADJACENT TO AND WEST OF THE SUBJECT CITY PROPERTY; SAID LEASE HAVING AN INITIAL TERM OF FIVE YEARS, WITH AN OPTION TO RENEW FOR FOUR YEARS AND 364 DAYS, AT THE CITY'S DISCRETION; FURTHER WAIVING, BY SnTHS VOTE, THE COMPETITIVE BIDDING AND APPRAISAL REQUIREMENTS, AS REQUIRED BY SECTION 82-39 OF THE MIAMI BEACH CITY CODE. ADMINISTRATION RECOMMENDATION Adopt the Resolution. ANALYSIS The City of Miami Beach (City) and Manpriya, Inc. have negotiated a five (5) year lease agreement, with an option to renew for an additional four (4) years and three hundred sixty four (364) days, with the renewal option being at the City's sole discretion, for the use of approximately 2080 square feet of vacant City-owned property located at 22 Washington Avenue (the Property) as an outdoor cafe associated with a restaurant operation located at 816 Commerce Street, which is directly adjacent to and west of the subject property. The subject Property (see attached site plan) is the remaining portion of a lot that had been previously acquired by the City for the expansion of a portion of Washington Avenue (between Commerce Street and South Pointe Drive) which has already been completed. The Administration deems that the Property does not readily lend itself for public use at this time. The Lease Agreement, as negotiated, includes the following terms and conditions: · FEE: During the initial five year term, Manpriya, Inc. has agreed to compensate the City as follows: · 1st and 2nd' Year: The greater of a minimum guaranteed amount of $52,000 (approximately equal to $25.00 per square foot) or five percent (5%) of its annual gross receipts. . 3rd and 4th" Year: The greater of a minimum guaranteed amount of $62,400 (approximately equal to $30.00 per square foot) or five percent (5%) of its annual gross receipts. . 5th Year: The greater of a minimum guaranteed amount of $83,200 (approximately equal to $40.00 per square foot) or five percent (5%) of its annual gross receipts. *The Minimum Guarantee for the ~d Year and 4th Year shall be increased by three (3%) percent, or the Consumer Price Index, whichever is greater. A yearly "true-up" to reconcile the Minimum Guaranteed amounts with the actual "gross receipts" will be performed by a Certified Public Accountant (at Manpriya's sole cost and expense) at the end of each contract year and any amounts due above the Minimum Guaranteed will be due and payable to the City within 30 days of the end of each contract year. Overall, the five year minimum guarantee to the City will be $315,432, versus a standard sidewalk cafe return of $156,000. The difference in fees is justified by Manpriya's ability to make leasehold improvements to the Property, as contemplated in Subsection 9.1 and in accordance with Exhibit 9.1 of the Lease Agreement, which would not be permitted through a standard sidewalk cafe permit. Beyond the monetary return to the City, the City additionally benefits by retaining ownership of the Property in the event that the block were to be redeveloped or undergo other use changes. . DEVELOPMENT: Manpriya, at its sole cost and expense, will develop the Property into the aforementioned outdoor cafe, and demolish and remove any improvements at Lease termination (at the City's discretion). . USE: Manpriya agrees to use the Property solely as an outdoor cafe to serve the patrons and guests of the adjoining restaurant at 816 Commerce Street. Furthermore, Manpriya agrees not to place any speakers in or around the Property and/or attach any speakers to the exterior of the restaurant building at 816 Commerce Street. The attached Planning Department analysis (Attachment A) supports the Lease and recommends the condition of use as stated above, and further defined in Subsection 8.4 of the Lease. Said Planning Department condition of use is consistent with expressed City Commission concerns and has been incorporated in order to mitigate those concerns. . PERFORMANCE BOND: Manpriya agrees to provide a performance bond, or other similar instrument (e.g. irrevocable letter of credit, surety bond, etc.) acceptable to the City, in an amount equal to the estimated costs to demolish and remove any improvements constructed on the property at the termination and/or expiration of the lease term. Section 82-39 of the Miami Beach City Code, governing the sale/lease of public property, provides that the lease of any City-owned property, including option periods, requires the following: 1) a public bidding process; 2) Planning Department analysis; 3) an independent appraisal to determine the value of the leasehold interest; and 4) a public hearing to obtain citizen input. Section 82-39 further provides for the waiver of the competitive bidding and appraisal requirements, by 5/7ths vote of the Mayor and City Commission, upon a finding by the Mayor and City Commission that the public interest would be served by waiving such conditions. While a waiver of the appraisal requirement is recommended, excerpts from an appraisal completed by the Tenant and building owner are included as Attachment B. The appraisal values the Property, for purposes of purchase, between $0 and $150,000. The negotiated Lease Agreement well exceeds this value. On March 8, 2006, the Mayor and City Commission adopted Resolution No. 2006-26148 setting a Public Hearing on April 11, 2006, to hear public comment regarding the lease agreement. Therefore, the Administration recommends that the Mayor and City Commission, following a duly noticed Public Hearing to obtain citizen input on same, approve and authorize the Mayor and City Clerk to execute a lease agreement between the City and Manpriya, Inc., for the lease of approximately 2080 square feet of City-owned property located, at 22 Washington Avenue, Miami Beach, Florida, for the purpose of an outdoor cafe associated with a restaurant operation located at 816 Commerce Street, which is directly adjacent to and west of the subject City property; said lease having an initial term of five years, with an option to renew for four years and 364 days, at the City's discretion; further waiving, by 5/7ths vote, of the competitive bidding and appraisal requirements; as required by Section 82-39 of the Miami Beach City Code. JMG\RCM\rlr Attachments (2) F:\DDH P\$ALL \ASSET\22 WASH I NGTON\ManpriyaLease.M EM .doc Attachment A CITY OF MIAMI BEACH Planning Department Interoffice Memorandum m To: Robert C. Middaugh Assistant City Manager From: Jorge G. Gomez, Afff ~~ Planning Director fV Subject: Analysis of Proposed Lease with Manyprey, Inc., 22 Washington Avenue Date: March 16, 2006 Pursuant to your request, this memorandum will serve as an analysis of proposed lease with Manyprey, Inc., of approximately 2080 square feet of vacant City-owned property, located at 22 Washington Avenue, for an outdoor cafe associated with a restaurant operation located at 816 Commerce Street, which is directly adjacent to and west of the subject property. Section 82-38 of the Code of the City of Miami Beach requires that any proposed sale or lease of city-owned land be analyzed from a planning perspective so that the City Commission and the public are fully apprised of all conditions relating to the proposed sale or lease. The following is an analysis of the eight criteria delineated in Section 82-38 of the Code: 1. Whether or not the proposed use is in keeping with City goals and objectives and conforms to the City Comprehensive Plan. The subject property, 22 Washington Avenue, is designated CPS-1, Commercial Limited Mixed-Use on the Future Land Use Map of the City's Comprehensive Plan The Lease Agreement between the City and Manyprey, Inc for the use of this area as a sidewalk cafe would be consistent with the land use designation contained in the Comprehensive Plan. 2. The impact on adjacent property, including the potential positive or negative impacts such as diminution of open space, increased traffic, noise level or enhanced property values, improved development patterns and provision of necessary services. Based on the proposed use of the property, the City shall determine the potential impact of the project on City utilities and other infrastructure needs and the magnitude of costs associated with needed infrastructure improvements. Should it become apparent that further evaluation of traffic impact is needed, the proponent shall be responsible for obtaining a traffic impact analysis from a reputable traffic engineer. The site is currently vacant. The proposed sidewalk cafe would diminish open space only in the sense that the currently vacant area becomes occupied with Page 2 Date: March 15, 2006 Manyprey, Inc., 22 Washington Avenue tables, chairs and landscaping; however, the site would remain open to the sky and the landscaping would be improved. There would be a moderate increase in traffic generation and demand for necessary services due to the increased occupancy of the restaurant. Noise levels should be contained, as there is no entertainment permitted in this district. However, an additional condition of approval, prohibiting outdoor speakers, should be considered by the Commission, in order to ensure that there is no negative impact as a result of background music being played too loudly. 3. A determination as to whether or not the proposed use is in keeping with a public purpose and community needs, such as expanding the City's revenue base, reducing City costs, creating jobs, creating a significant revenue stream and improving the community's overall quality of life. The subject property is the remaining portion of a lot that had been previously acquired by the City for the expansion of a portion of Washington Avenue (between Commerce Street and South Pointe Drive) which has already been completed, and the subject parcel does not readily lend itself for public use at this time. 4. Determination as to whether or not the development is in keeping with the surrounding neighborhood, will block views, or create other environmental intrusions, and evaluation of the design and aesthetic considerations of the project. The proposed development is generally in keeping with the commercial nature of the district, will not block views or create aesthetic intrusions. 5. The impact on adjacent properties, whether or not there is adequate parking, street, and infrastructure needs. Proper safeguards and precautions should be taken to ensure that there are no negative impacts on adjacent properties. No entertainment or music will be permitted except for low-level ambient music (appropriately shielded from the public-rights-of-way) and as further may be restricted by applicable law. The Commission may wish to go further and prohibit outdoor speakers from being placed in the sidewalk cafe area. Parking is a problem throughout the City, and the proposed lease may have a moderate effect on the need for parking, since it would add a number of seats to the proposed restaurant. 6. A determination as to whether or not alternatives are available for the proposed disposition, including assembly of adjacent properties, and whether the project could be accomplished under a private-ownership assembly. Page 3 Date: March 15, 2006 Manyprey, Inc., 22 Washington Avenue Due to the configuration of these properties, after the expansion of Washington Avenue, there is sound reasoning for assembling the parcels. Otherwise, the City owned property would continue to prevent access to the Washington Avenue fa(fade of the 816 Commerce Street building. By leasing the property to the restaurant for use as a sidewalk cafe area, the City is helping to alleviate a problematic situation. 7. Within the constraints of public objectives, the department should examine financial issues such as job generation, providing housing opportunities, and the return to the City for its disposition of property. The proposed lease should increase the viability of the restaurant at the subject location, thereby enhancing the economic vitality of the area. No housing opportunities are contemplated. The City will receive a return for its property. 8. Such other items as the Planning Department may deem appropriate in analysis of the proposed disposition. Planning Staff recommends that the lease include a provision prohibiting outdoor speakers from being attached to the exterior of the building or placed in any manner in the sidewalk cafe area. JGG/RGL F:\PLAN\$ALL\GEN_CORR\INTEROFF\22 Washington Avenue.doc Attachment B PUBLIC RIGHT-OF-WAY PROPERTY CONCLUSIONS AND OPINIONS CONCLUSIONS AND OPINIONS It is concluded that, the property must be creditably valued '"rebus sic stantibus" (Latin for as it stands), in its existing state and not as it might be or could be made into. Since the subject parcel fails the test of "legally permissible", a market search of land sales transactions similar to and proximate to the subject parcel is not warranted, nor would be applicable because sales of properties that would be analyzed as "comparable sales" were sold under the expectation that a legally permissible, physically possible and financially feasible use for investment oould be realized, and to compare such transactions to the subject parcel would not be appropriate for reasons previously stated. Therefore, the Market Value, as of August 11 !,.20Q~, is DE MINIMIS $- 0 - Market Value (as defined). ; ~. ~ < J} The subject parcel does. however, have ~!~~~n6'benefit pursuant to Article IV of the City Code, under Right-of-Way, DivisiOn.S, Side..;J~I~,Cafes. This Code Division states tha t: A full-service restaurantjcaW:b~ a recipient of a sidewalk cafe permit located on a right-of-way thaH~l~tat~ Depa~~t of Transportation, the County or the City owns in fYILpr tia~,)ah'l~.~m~nt devoted to or required use as a transportation fClcilityiOi':~:tr.eeti.:; "'; The sidewalka~ is that' p~rtio~:jof the right-of-way located between the curb line or laterialline;.Qf a street and the adjacent property line which is intended for use by pedestrians. Lincoln Road Mall's sidewalk slightly differs as to the area between the property line and the center line of the right-of-way (exel usive of the former .12 fOOl wide vehicular roadway). The Code further states that, the adjacent property can use the right-ot-way for a sidewalk cafe associated with a full-service restaurant, and install portable tables, chairs, awnings, canopies or umbrellas (subject to permits). The sidewalk cafe must include pedestrian pathway as it relates to the sidewalk cafe, subject to planning, design, and historic preservation division viewings. Note: This appraisal assumes that the City Is bound to grant a sidewalk cafe permit to the adjacent property, providing that the adjacent property ownerltenant can comply with the City Code for such permit. IRR Inl.eg'~ ~f.)/11 Nm\I(ll> Soul" ntlfida PAGE 8 PUBLIC RIGHT-oF-WAY PROPERTY CONCLUSIONS ANO OPINIONS The usable sidewalk area, defined by the City, is "the frontage of the property times the width of the sidewalk, less five feet". The subject frontage meets this definition. The City's annual fee per square foot of usable sidewalk area (including the area between the tables and chairs) increased from $12.50 per square foot commencing on October 1, 2003 to $15.00 per square foot commencing on October 1, 2004. NOTE: Due to the shape of the parcel, the practical use may be substantially less square footage for the purpose of calculating the annual fee. Subject to survey verification, the gross area of this right-of~way parcel is 2,080:1: square feet. However, the usable square feet may be less due to its trapezoidal shape. For the purpose of analysis. Integra - South Florida h~s calculated the market rent or fee for the sidewalk cafe use based upon total square feet at $31.200 annually ($2,600/month). If it is found by survey that thefl\Jsable"s1d~walk area is less, then by mutual agreement, the City and the PropertY:QwnerlTenant den agree to a fair annual fee amount. i, ..;:: l ,~~ > > Integra - South Florida has further ~1~~~ltp,~ cD'rrent Ad Valorem Assessment of the abutting property at 22 V\(.asnington AJe.hue ana the Ad Valorem Assessments of the subject parcel (former Lots1:~ 2). . These pC!fcels are assessed uniformly at $70.00 per square foot. It is concluded:tbat, If th~'Gity (oWner of the Burdened Tenement) and the abuttIng .. ~<, " property owner (owne{'(lt the ,pominant Tenement) agree to enter into a sale of the subject "Right-of-Way" Prop~rty. a Market Price could be established based upon two (2) approaches. ;,; Assessed Value Method @ $70.00/Sq.Ft. for $145,600 Income Capitalization Method @ a 20% Capitalization Rate $156,000 Reconciled Market Price Opinion for the 2,080 s.t. Right-of~Way as of August 11, 2005: ONE HUNDRED FIFTY THOUSAND DOLLARS ($150.000) IRR ~!"9'~.~.~!'S SOUlh Hori(jj PAGE 9