Miami looks to up the ante on Riverside Wharf lease

Miami city commissioners on Tuesday approved the ballot wording for a special election Aug. 23 at which city voters will get a second chance to weigh in on a vast mixed-use downtown project that would add a luxury hotel and a site lease up to a century.

The new lease, if voters approve, would also mean more money to the city by increasing the base rent and the total private investment amount for the overall development.

In December, MV Real Estate Holdings, along with Driftwood Capital, announced Riverside Wharf, a hospitality-driven entertainment complex on the Miami River.

The public-private partnership involves the city, which owns a site on the river’s east bank and leases it to Riverside Wharf LLC, a company that also controls an adjoining private property.

Voters approved the original lease in 2016, as charter requires.

At its March 10 meeting the city commission directed the city attorney to prepare a new charter amendment for consideration at a special election Aug. 23.

That legislation was discussed Tuesday and approved by unanimous vote after some discussion.

If approved by voters and by the city and developer in a final lease, the move would add 50 more years to the lease and permit the Wharf to build a hotel at its expense.

An affirmative vote Aug. 23 would authorize the commission, by a four-fifths vote, to waive competitive bids and authorize the city manager to negotiate an amendment to the original lease with Riverside Wharf LLC to lease and develop city land at 236 and 298 SW North River Drive.

Jacqueline Lorenzo, with the city’s Department of Real Estate & Asset Management, said the increase in the base rent would have the tenant paying about $330,000 a year. The figure was calculated after two recent property appraisals, she told the commission.

The new deal increases the private investment in the property from $7 million to $30 million.

Commissioner Joe Carollo asked if the revenue to the city from the project was limited to rent.

Ms. Lorenzo said the new deal would also have the tenant paying 15% of gross revenues to the city.

“It includes (a percentage of) any revenues they generate on the site,” she said.

Riverside Wharf is to be a two-tower development anchored by a 165-room 8-story Dream Miami luxury hotel.

Commissioner Alex Diaz de la Portilla said, “Tell me a little bit about the hotel.”

Javier F. Aviñó, an attorney representing Riverside Wharf LLC, responded, “The hotel is actually located on the private property which is adjacent to the city property. So, the city property will consist of food and beverage outlets exclusively.”

Mr. Diaz de la Portilla: “But it’s part of the complex.”

Mr. Aviñó: “It is. They’ll be connected through bridges.”

Mr. Diaz de la Portilla said: “The concern I have is community benefits. Are there any community benefits attached to this project?”

Iris Escarra, an attorney representing the developer, said the program of community benefits includes a new seawall, street improvements, resiliency measures and more.

The project itself requires city commission approval, she said, and the owner-developer’s team will be back with a detailed site plan, design drawings and more.

Mr. Diaz de la Portilla noted that the area of the development is in Chair Christine King’s district but also near his district and that of Mr. Carollo.

“The whole area needs to be beautified,” he said. “And the community benefits are going to matter to this entire commission … you know very well you need to spend community dollars to benefit the area and not just your particular development. So, I want it to be a serious commitment.”

Ms. Escarra said, “Will do. And we’ll make sure that before we come back with the project, we’ll make sure to sit down with everyone.”

The wording on the August ballot will be:

“Shall Miami’s Charter be amended authorizing the City Commission, by 4/5ths vote, to amend the existing Riverside Wharf lease, thereby increasing base rent by 50 percent or fair market rent, if greater, increasing private investment in the property from $7,000,000 to $30,000,000, extending the term by 50 years, and requiring that tenant construct the project consistent with zoning, and resiliency requirements, and construct a new seawall and publicly accessible Riverwalk?”

The public-private partnership first went before voters in 2016. They then approved a plan for a complex of four riverfront restaurants and event spaces and a fish market and oyster bar to be run by Garcia’s Seafood, along with a new portion of riverwalk.

The original lease was for 30 years with two options to renew for 10 years each, for a total of up to 50 years.