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Resolution: R-10-0402
File Number: 10-01116a
City Hall
3500 Pan American
Drive
Miami, FL 33133
www.miamigov.com
Final Action Date: 9/23/2010
A RESOLUTION OF THE MIAMI CITY COMMISSION, WITH ATTACHMENT(S),
APPROVING EXHIBITA HERETO ("EXHIBITA"), THE AMENDED AND RESTATED
AGREEMENT TO ENTER INTO GROUND LEASE ("AMENDED AND RESTATED
AGREEMENT TO ENTER"), AND THE AMENDED AND RESTATED GROUND
LEASE(S) ("AMENDED AND RESTATED GROUND LEASE(S)") (EACH IN
SUBSTANTIALLY THE ATTACHED FORM(S)), BETWEEN THE CITY OF MIAMI
("CITY") AND FLAGSTONE ISLAND GARDENS, LLC ("FLAGSTONE"), AND
AUTHORIZING AND DIRECTING THE CITY MANAGER AND THE CITY ATTORNEY
TO EXECUTE THE AMENDED AND RESTATED AGREEMENT TO ENTER, AND
THE AMENDED AND RESTATED GROUND LEASE PROVIDING FOR, INTER ALTA:
(1) FLAGSTONE'S OPTION TO DEVELOP THE MEGA -YACHT MARINA WITH ITS
ANCILLARY FACILITIES, RETAIL, PARKING, HOTELS AND ALL OTHER RELATED
FACILITIES (THE "PROJECT") IN ITS ENTIRETY ALL AT ONCE OR THROUGH
PHASED DEVELOPMENT ON A COMPONENT BY COMPONENT BASIS; (2)
EXTENDING THE POSSESSION DATE FROM FEBRUARY 1, 2010 TO
SEPTEMBER 1, 2013, OR SOONER, AT FLAGSTONE'S OPTION; (3)
ESTABLISHING AN ANNUAL PAYMENT SCHEDULE FOR ALL COMPONENTS
COMMENCING WITH THREE HUNDRED THOUSAND DOLLARS ($300,000) AND
INCREASING TO TWO MILLION DOLLARS ($2,000,000) NO LATER THAN THE
YEAR 2018, SUBJECT TO CERTAIN CREDITS AND OTHER CONDITIONS
RELATED TO DEVELOPMENT ON A COMPONENT BY COMPONENT BASIS; (4)
EXTENDING CERTAIN MILESTONE DATES IN THE TIMELINES FOR
CONSTRUCTION COMMENCEMENT, COMPLETION, AND OTHER
DEVELOPMENT MATTERS AS SET FORTH IN EXHIBIT A; AND (5) PROVIDING
FOR SECURITY DEPOSIT(S), PROVIDED, HOWEVER THAT SUCH APPROVAL,
AUTHORIZATION AND DIRECTION ARE ALL SUBJECT TO AND CONDITIONED
UPON A SATISFACTORY DETERMINATION OF SECTION VIII, ENTITLED "STATE
WAIVER" OF EXHIBIT REGARDING PAYMENTS TO THE STATE OF FLORIDA
("STATE"); FURTHER DIRECTING THE CITY MANAGER TO RETURN TO THE CITY
COMMISSION FOR APPROVAL REGARDING THE STATE WAIVER; FURTHER
AUTHORIZING AND DIRECTING THE CITY MANAGER AND THE CITY ATTORNEY
TO MAKE NON -SUBSTANTIVE REVISIONS AS NECESSARY TO EXHIBIT A, THE
AMENDED AND RESTATED AGREEMENT TO ENTER, THE AMENDED AND
RESTATED GROUND LEASE(S) ALL DOCUMENTS RELATING TO THE STATE
WAIVER.
WHEREAS, the City of Miami ("City") is the owner of certain real property located on Watson
Island at approximately 1050 MacArthur Causeway, Miami, Florida (the "Property"); and
WHEREAS, pursuant to the processes for the City's Mega Yacht Marina and Mixed Use
Waterfront Development Request for Proposal and all addenda thereto (collectively, the "RFP"), for
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File Number: 10-01116a Enactment Number: R-10-0402
development on the Property of a mega -yacht marina with its ancillary facilities, retail, parking, hotels
and all other related facilities (the "Project") Flagstone Properties, LLC submitted a proposal and was
selected as the most qualified responsive and responsible bidder; and
WHEREAS, the City Commission pursuant to Resolution No. 01-972, adopted September 17,
2001, and Resolution No. 01-1028, adopted September 25, 2001, polled the electors of the City of
Miami regarding leasing the Property to Flagstone Properties, LLC for the Project and pursuant to
Referendum on November 6, 2001 (the "Referendum") the voters returned an affirmative vote; and
WHEREAS, Flagstone Properties LLC subsequently merged with Flagstone Island Gardens, LLC
(collectively, "Flagstone"), and pursuant to City Commission Resolution No. 02-1304, adopted
December 12, 2002, entered into an Agreement to Enter Into Ground Lease, with the City, dated
January 1, 2003 with exhibits and attachments thereto (the "Agreement to Enter") including the form
of proposed Ground Lease (the "Ground Lease"); and
WHEREAS, the Agreement to Enter has certain conditions that must be met for the future
execution of a long-term Ground Lease with Flagstone; and
WHEREAS, the City and Flagstone agreed upon and entered into that certain First Amendment to
the Agreement to Enter Into Ground Lease and Amendment to Form of Ground Lease dated
December 12, 2004 (the "First Amendment To Agreement To Enter"); and
WHEREAS, the City and Flagstone agreed upon and entered into that certain Second
Amendment to Enter Into Ground Lease dated December 8, 2006 (the "Second Amendment to
Agreement to Enter"); and
WHEREAS, Flagstone experienced delays in obtaining financing due to the downturn in the real
estate market requiring adjustments to the Lease Deadline referred to in Section 6.2.1 of the
Agreement to Enter and to the Outside Date referred to in Section 6.2.3 of the Agreement to Enter to
February 1, 2010; and
WHEREAS, Flagstone and the City agreed upon and entered into a Third Amendment to the
Agreement to Enter Into Ground Lease and Amendment to Form of Ground Lease dated July 30,
2008 (the "Third Amendment to Agreement to Enter"); and
WHEREAS, the RFP contemplates that the Project may be developed by one developer on a
component by component basis; and
WHEREAS, Flagstone has requested additional modifications to the Agreement to Enter and to
the Ground Lease to allow them sufficient time to secure financing and begin and complete
construction on the Project; and
WHEREAS, in connection with the cooperation provisions of the Agreement to Enter, Flagstone
has agreed to allow the City to use the Property, without prior notice to Flagstone, for the City's and
other user's benefit, as the City may deem appropriate, prior to the City's issuance of Flagstone's
building permit, or September 1, 2013, whichever comes earlier; and
WHEREAS, the parties have negotiated and desire to enter into the terms and conditions of
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Exhibit A hereto ("Exhibit A"), the Amended and Restated Agreement to Enter into Ground Lease
("Amended and Restated Agreement to Enter") and the Amended and Restated Ground Lease(s)
("Amended and Restated Ground Lease(s)"), each in substantially the attached form(s), providing for,
inter alia, (1) Flagstone's option to develop the Project in its entirety all at once, or on a component
by component basis as described in the attached Exhibit A, incorporated herein by this reference; (2)
extending the possession date from February 1, 2010 to September 1, 2013, or sooner, at
Flagstone's option; (3) establishing an annual payment schedule based upon all components
commencing with three hundred thousand dollars ($300,000) and increasing to two million dollars
($2,000,000) by year 2018, subject to certain credits and certain conditions related to development on
a component by component basis, as described in Exhibit A; (4) extending certain milestone dates in
the timelines for construction commencement, completion, and other development matters as set
forth in Exhibit A; and (5) providing for security deposit(s); and
WHEREAS, on January 28, 2010 in connection with Mayor's Discussion Item No. 10-00089, the
City Commission authorized an extension of the expiring Agreement to Enter until the March 11, 2010
City Commission meeting in order to permit further negotiations regarding the terms and conditions of
extension; and
WHEREAS, on March 11, 2010, the City Commission pursuant to Resolution No. 10-0091,
authorized an extension of the expiring Agreement to Enter until the March 25, 2010 City Commission
meeting in order to permit further negotiations regarding the terms and conditions of extension; and
WHEREAS, on March 25, 2010, the City Commission pursuant to Resolution No. 10-0144,
authorized a further extension of the expiring Agreement to Enter until the April 22, 2010 City
Commission meeting in order to continue negotiations regarding terms and conditions of the
extension; and
WHEREAS, on April 22, 2010, and at subsequent City Commission meetings on on May 13, 2010
and on June 24, 2010, the Mayor reported to the City Commission that negotiations were continuing
regarding terms and conditions of the extension; and
WHEREAS, on September 16, 2010, the City Commission authorized the parties, inter alis, to
submit their final documents, terms and conditions on that date to be considered by the City
Commission at the September 23, 2010 meeting and required Flagstone to provide a $200,000.00
certified check to the City by September 23rd for the Consideration for Use payments from February
1, 2010 to September 30, 2010; and
WHEREAS, the proposed changes in the Amended and Restated Ground Lease(s) are required
to be approved by the Board of Trustees of the Internal Improvement Trust Fund of the State of
Florida ("Board of Trustees") as required by the Partial Modification of Restrictions for the Property,
filed for record March 18, 2005 in Deed Book 23181, Page 775 of the Public Records of Miami -Dade
County, Florida (the "Partial Modification of Restrictions") which modifies the restrictions set forth
within Deed No. 19447 from the Board of Trustees in favor of the City filed for record April 11, 1949 in
Deed Book 3130, Page 257 of the Public Records of Dade County, Florida;
NOW, THEREFORE, BE IT RESOLVED BY THE COMMISSION OF THE CITY OF MIAMI,
FLORIDA:
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Section 1. The recitals and findings contained in the Preamble to this Resolution are adopted by
reference and incorporated as if fully set forth in this Section.
Section 2. The City Commission approves Exhibit A, the Amended and Restated Agreement to
Enter, and the Amended and Restated Ground Lease(s) (each in substantially the attached form(s),
between the City and Flagstone, and authorizes and directs the City Manager{1 } and the City Attorney
to execute the Amended and Restated Agreement to Enter, and the Amended and Restated Ground
Lease(s) providing for, inter alis: (1) Flagstone's option to develop the Project in its entirety all at
once, or on a component by component basis, as described in the Exhibit A; (2) extending the
possession date from February 1, 2010 to September 1, 2013, or sooner, at Flagstone's option; (3)
establishing an annual payment schedule for all components commencing with three hundred
thousand dollars ($300,000) and increasing to two million dollars ($2,000,000) by year 2018, subject
to certain credits and other conditions related to development on a component by component basis,
as described in Exhibit A; (4) extending certain milestone dates in the timelines for construction
commencement, completion, and other development matters as set forth in Exhibit A; and (5)
providing for security deposit(s); provided, however that such approval, authorization and direction
are all subject to and conditioned upon a satisfactory determination of Section VIII, entitled "State
Waiver" of Exhibit A regarding payments to the State; and further directing the City Manager to return
to the City Commission for approval regarding the State Waiver.
Section 3. The City Manager and the City Attorney are further authorized{1 } and directed to make
non -substantive revisions as necessary to Exhibit A, the Amended and Restated Agreement to
Enter, the Amended and Restated Ground Lease(s), and all documents related to the State Waiver.
Section 4. This Resolution shall become effective immediately upon its adoption and signature of
the Mayor.{2}
Footnotes:
{1} The herein authorization is further subject to compliance with all requirements that may be
imposed by the City Attorney, including but not limited to those prescribed by applicable City Charter
and Code provisions.
{2} If the Mayor does not sign this Resolution, it shall become effective at the end of ten calendar
days from the date it was passed and adopted. If the Mayor vetoes this Resolution, it shall become
effective immediately upon override of the veto by the City Commission.
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