The commission voted unanimously to support the project headed by Mehmet Bayraktar, Flagstone chairman and chief executive officer; Sherwood Weiser, chairman of Miami-based Continental Companies; and Eric R. Kuhne of Miami-based Eric R. Kuhne & Associates.
The proposal requires ratification by registered Miami voters. They will be asked on Nov. 6 whether to grant Flagstone Properties a 45-year lease, with two 15-year renewal options.
The minimum annual rent would be $2 million on 10.8 acres of waterfront property and 13.4 acres of submerged land at this 86-acre artificial island adjacent to the Port of Miami cruise ship-turning basin.
In exchange, the Flagstone group is proposing the development of a 54-slip, five-gold star Anchor Facility; a 175-unit Wave Hotel operated by Conrad Hotels, with 50 time-share licensed suites; a 250-room Lighthouse Hotel operated by the Regent Group, with 50 time-share licensed suites; 84,012 sf of restaurant space; and a 10,629-sf open-air fish market.
Even if voters approve the lease, however, the city commission could ultimately reject Flagstone's proposal. The city may discontinue negotiations without financial or legal liability, if the city manager cannot reach a final contract with the developer.
In recommending Flagstone as the most responsive and responsible bidder, City Manger Carlos A. Gimenez cited the nearly unanimous support for the project by an independent city review commission and reviews by PricewaterhouseCoopers and Barry Abramson, a real estate consultant working under contact with the city.
"The CPA remarked that Flagstone's operating procedures and management plan were very thorough," Gimenez says in his recommendation to the commission.
Citing Abramson's evaluation, Gimenez says the Flagstone proposal offered the city the best overall return, possibly generating from $24.2 million to $73.9 million in rent and taxes over the lease term.
"In (Abramson's) analysis, Flagstone's proposal, even at a low level of success, still offers the city the greater revenue than the other two proposals," Gimenez notes in his recommendation.
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