HomeMy WebLinkAboutSubmittals at PZAB MtgsMiami Economic
Associates, Inc.
November 12. 2020
Miami City Commission
City Hall
3500 Pan American Dnve
Miami. FL 33133
Re: Miami Design District
Dear Commissioners.
Miami Economic Associates. Inc. (MEAI) has performed an analysis to estimate the key
economic, fiscal and public benefits that have been generated by the subject project to
date for the City of Miami as well as Miami -Dade County and the Miami -Dade County
Public School District- The analysis we performed was commissioned by Miami Design
District Associates (Del), LLC (MDDA) to provide context for the City as it considers
proposed amendments to the projects special area plan (DD SAP) and modifications to
its Regulating Plan and Concept Book and the Development Agreement between the
City and MDDA (Development Agreement)
The materials that follow provide our estimates of the key economic, fiscal and public
benefits that Miami Design District has generated to date. The remainder of this letter is
organized as shown below:
'' Section Page
Kr ey Findings 2
Economic Benefits 2
Fiscal Benefits 4
Public Benefits 5
Closing ._ . 6
6861 S.W. 89I^ Terrace Miami, Florida 33158
Tel: (3051 669.0229 Fax: (8581 496-6107 Email: meaink+ beilsouth.riet
Miami City Commission
November 12. 2020
Page 2
Key Findings
The key findings of the analyses performed by MEAL are follows
• The Miami Design District to data has generated a total of 4,612 jobs including 3.100
jobs on -site (direct workers; and 1.512 jobs either in businesses related to the on -site
economic activity (indirect workers} or in businesses where the direct and indirect
workers spend their earnings The annual income of all these workers exceeds
5202.0 million.
• The Miami Design District project will pay approximately $9.14 million in ad valorem
taxes this fiscal year including nearly $3.6 million to the City of Miami.
• Miami -Dade County annually collects 1-cent local option sales taxes on more than
$357 million in transactions at the Miami Design District project.
• As shown :n the table below me Miami Design District project has already funded
more than 5119.0 million in public benefits within the DD SAP and is expected to
fund at least 53.0 million more in the future
Public Benefits to Dade
Miami Design District Project
Public Benefit Developer Costs Total Benefit
Public Right of Way Investment 5 13,765.732 5 24.015.732
Public A_ rt Investment $ 8.908,000 $ 6.908,000
yArtistic Garage Facades 5 8.744.475 $ 8,744.475
Contribution towards 1CA" $ 23.600.000 $ 75.000,000'"-
On-going Maintenance Costs"'" $ 4.900.000 $ 4.900.000
Public Benefits Provided in DD SAP $ 57,918.207 $ 119,568,207
Donation of the IOts underlying the Institute for Contemporary An (1CA)
'-- This amount has been raised to turd the ICA for 10 year$
-'.• Estimate of the net present veiue at maintenance costs over 20 years
Source. Miami Design district A5Socia•ess (Del) LLC, Miami Economic Associates, Inc.
Economic Benefits
Tne term "economic benefits" refers to the positive impact that the Miami Design District
project has had on the economy of the City of Miami and/or Miami -Dade County in terms
of jobs and labor income. To estimate that impacts that the completed portions of the
project are currently generating on an annual basis. MEAI utilized the Minnesota
IMPLAN Input -Output Model A description of the model may be found in the Appendix
to tis letter on page 7
According to information provided to MEAL by MDDA. there are currently 981,792 square
feet of operating space within the Miami Design District. Of that amount 392.718 square
feet are occupied retain establishments. 264,354 square feet occupied by showrooms
(generally displaying furniture and riome furnishings and equipment) and art gallOrles.
25.329 square feet operated by health/wellness businesses and personal service
Miami Economic Associates, Inc. 68G1 S.W. S9,' Terrace Miami, Florida 33156
Tel: (30S 669-0229 Fax: (866) 496-6107 Email: mesink+_:belisouth.net
Miami Ccty Commission
November 12, 2020
Page 3
establishments. 101.604 square feet occupied by restaurants and 186.195 square feet of
office space. In conducting its analysis. MEAI considered all the space just enumerated
however. we did not consider the remaining 68,565 square feet of space that houses
other diverse uses.
The table below provides MEAI's estimate of the economic benefits currently being
generated the Miami Design District project an annual basis in terms of jobs and labor
income
Benefits
Jobs Created
Direct
Indirect
Induced
Total
Economic Benefits
Miami Design District Project
(2020 Constant Dollars)
3,100
686
826
4.612
Labor Income (Ail workers) 5 202,273.400
Scurca: Miami Design District Associates Pei). LLC, IMPLANT Miami Econemic Associates. Inc.
With respect to the above table. the following points are noted:
• The term 'direct jobs_ refers to jobs on -site. "Indirect jobs- are jobs in industries
related to the on -sate economic activity while induced jobs" are jobs in economic
sectors across the entirety of the economy in which the direct and indirect workers
spend their earnings.
• The estimates of indirect and induced jobs as well as labor income and value-added
were estimated based on the assumption that there would be 2.959 direct workers
en -site on a full-time equivalent (FTE) basis. The figure was. in turn. arrived at by
assuming that: 1) the 682,401 square feet of retail. showroom and gallery space and
wellness/health and persona! service space would be occupied by 2 5 workers per
1,000 square feet on a FTE basis, 2) the 101.604 square feet of restaurant space
would be occupied space would be occupied by 5 workers per 1.000 square feet on
a FTE basis. and 3) the 1 86.195 square feet of office space would be occupied by 4
workers per 1.000 square `eet on a FTE basis The number of FTE's on -site also
includes the 141 people employed by the project to deal with leasing. security,
parking operations and maintenance.
• The number of workers employed on site is likely to substantially exceed the number
of FTE's because the workforce$ in the retail, personal service and restaurant
sectors Includes high percentages of part-time workers.
• The IMPLAN model estimates the number of workers employed countywide rather
than the City of Miami. however MEAL believes that City residents will hold a
substantial percentage of the countywide jobs.
Miami Economic Associates, Inc. A661 S.W. 59t^ Terrace Miami, Florida 33156
Tel: (305) 669-0229 Faxs (866) 496.6107 Email: meainkc,betisouth.net
Miami City Commission
November 12, 2020
Page 4
Fiscal Benefits
The term 'fiscal benefits" refers to the positive impact that the Design District project has
on the finances of the City of Miami as well as Miami -Dade County and Miami -Dade
County Public School District. Tile primary fiscal benefit that the project generates for
each is the ad valorem taxes it pays to them The City also collects a significant amount
of revenue each year in the form of utility taxes and franchise fees: however. MEAI did
not have sufficient information available to it to estimate the amount of these revenues
collected on an annual basis. The project generates a significant amount of revenue for
the County each year from the 1 percent local option sales tax levied on retail and
restaurant sales rents and parking receipts.
Ad valorem Taxes
The table below shows the amounts of annual ad valorem taxes that will be collected by
the properties that compose the already developed portions of the Design District'. It
should be noted that figures shown reflect only the arnount of taxes paid an the real
property i e. land and buildings. Additional ad valorem taxes will be paid by the entities
occupying the buildings with respect to their personal propertyi e furniture. fixtures and
equipment
November 2020 Ad valorem Taxes
City of Miami. Miami -Dade County and Miami -Dade Public School District
Already Completed Portions of the Miami Design District Project
Jurisdiction/Fund
City of Miami
General Fund
Debt Service Fund
Toth
Miami -Dade County —
General Fund �.
Debt Service Fund
Library Fund
Total
Miami -Dade Public School District
Operating Fund
Debt Service Fund
Total
Amount
5 3,507.802
$ 88,307
$ 3,596,109
5 2.135,337
Total for All 3 Jurisdictions
Source. Miami Design District fDel: LLC.
Associates inc _.._
Sales Taxes
5 218,708
$ 129.944
$ 2,483,989
$ 2,918.705
$ 148,016
5 3,066,721
$ 9,146,819
liami-Dade County oraperty Appraiser: Miami Economic
• If those taxes are paia before the enc of this month they qualify for a 4 percent drSCounr,
Miami Economic AasocIateInc. 6861 5.W. 89th Terrace Miami, Florida 33156
Tel: (305) 669-0229 i`ax: 18G6) 496-6107 Email: mealnk belisouth.net
Miami City Commission
November 12, 2020
Page 5
The State of Florida collects a 6 percent sales tax on all retail sales of non-exempt items
and restaurant charges as well as or rents paid and parking fees collected on other than
on -street parking. The State retains approximately 91 percent of the sales taxes it
collects and rebates approximately 9 percent to the County in which the sales taxes
were originally collected The rebated amount is then divided between the County and
the municipalities within the County The amount rebated by any individual municipality
from a single source such as the Miami Design Project is generally fairly small,
Additionally, Miami -Dade County charges a 1 percent local option sales tax on the same
transactions, with the proceeds from that tax being split evenly between transit and the
Miami -Dade Health Trust
Information provided to provided to MEAI by MDDA identifies approximately 5357.0
million worth of transactions on which the 1 percent local option sales tax was levied in
2019. This figure utLiucied all rents paid and parking fees charged in the Design District's
parking garages that year. It also included the sales that occurred in approximately
355.000 square feet of retail space. It did not, however include sales in the nearly
265.000 square feet of space occupied by furniture and art galleries, the approximately
100,000 square feet of restaurant space and 68.656 square feet occupied by
miscellaneous uses within the Miami Design Distnct. The amount of local option sales
taxes collected in 2019 on the known amount of tax eligible transactions was 53.57
million
Public Benefits
The table below summanzes the public benefits that have already been provided by
MDDA in the DD SAP even though it has been unnecessary to date to obtain -bonus-
development capacity,
Public Benefit
Public Benefits to Dade
Miami Design District Project
Developer Costs
5 13.765.732
Public Right of Way Investment
Public Art Investment $ 6,908.000
Artistic Garage Facades S 8,744.475
Contribution towards ICA 5 23,600.000 S 75.000,000'
On -going Maintenance Costs"". $ 4.900.000 5 4.900.000
Public Benefits Provided in DD SAP $ 57,918,207 $ 119,568,207
" Donation of the lots underlying the Institute for Contemporary An (ICA)
--- This amount has been raised to tuna inr ICA For 10 years
"" Estimate of the net present value of maintenance costs over 20 years
Source Miami Resign District Associates (Dell LLC. Miami economic Associates tnc.
Total Benefit
5 24.015.732
S 6 908,000
5 8.744,475
MDDA has already installed much of the infrastructure needed to support future
development of the district However an additional 52 - 5 million in public infrastructure
and $1 - 3 million in public art spending are estimated in conjunction with the future DD
SAP projects. Together with this future spenrJing. the total value of the public benefits
will exceed 5122.0 million
Miami Economic Associates, Inc. 6861 S.W. 89th Terrace Miami, Florida 33156
Tel: (305) 669-0229 Fax: (866) 496-6107 Email: meainkgbellsouth.net
Miami City Commission
November 12. 2020
Page a
Closing
MEAL believes that the information presented above demonstrates that the Miami Design
District project has been highly beneficial to the City of Miami as well as Miami -Dade
County and the Miami -Dade Public School District. Approval of the proposed
amendments will enable the project to continue to be so. Future development within the
Miami Design District will result ,n significant numbers of new jobs being created. and
the amount ad valorem taxes collected from the district will rise substantially.
Accordingly, MEAI encourages you to approve the proposed amendment described
above
Sincerely,
Miami Economic Associates. Inc.
Andrew Dolkart
President
Miami Economic Associates, Inc. 6861 S.W. 89t* Terracrr Miami. Florida 33156
Tel: (305) 669-0229 Fax: (866) 496.6107 Email: mealnka.bellsauth.net
Miami City Commission
November 12, 2020
Page 7
Appendix
Minnesota IMPLAN Input -Output Model
The Minnesota IMPLAN input -Output Model relies on multiplier analysis which quantifies
the cumulative effect of dollars inserted into the regional economy. As a dollar moves
through the region. it creates additional revenue for linked businesses and/or their
employees who also spend that money. More simply. expenditures dispersed by one
entity become revenue to another, continuing an economic cycle which ultimately
dissipates bleeding into other regions or areas. Although several economic models are
available. they work in fundamentally similar ways and center on the same indicators,
The Minnesota IMPLAN model was initially created over 35 years ago at the University
of Minnesota and has been upgraded on a continuing basis in the ensuing years
The multiplier impacts calculated by the Minnesota IMPLAN model are based an input-
output methodology. which explicitly considers the inter -industry linkages that exist
within an economy Each Industry needs labor and inputs from other industries to
produce economic output Whenever an industry experiences an Increase in the demand
for its output. many other industries within that economy indirectly experience an
increase in demand as well because of these Inter -industry linkages This increase in
demand that results from the need for material inputs is called the indirect effects. In
addition. an increase in production within a region also leads to an increase in household
income through the hiring of workerswhich in turn generates further demands for goods
and services within the region Firms also need to expand their base of physical capital
to meet higher levels of demand. and this too stimulates regional economic growth The
latter effects are referred to as induced effects The inter -industry linkages and the
induced effects on consumer and capital spending lead to successive rounds of
production, and this process results in an increase in output that exceeds the initial
change in demand. or a multiplier effect. Similarly. the increase in household income will
exceed the initial payroll increase encountered in the industry that experienced the
original increase in demand. The total change in employment in the regional economy is
a multiple of the direct change in employment.
In addition to estimating employment. MEAI also used the Minnesota IMPLAN model to
quantify the total earnings or labor income of the direct indirect and induced workers as
well as the total gross domestic product. or value added, that would result from the
efforts of the direct, indirect and Induced employees Labor income consists of all forms
of employment income including wages and salaries and proprietor income Gross
domestic product (GDP). also known as value-added. is the increased value of a product
or service as the result of the economic inputs (labor and capital) expended at a given
stage. GDP is the sum of wages and salaries. proprietor income. interest and indirect
business taxes
Miami Economic Associates. Inc. 6861 S.W. 139«' Terrace Miami, Florida 33156
Tel: (305) 669-0229 Fax: (866) 496-610T Email: meainicµhellsauth.net
BUENA VISTA
11 1 5 T U R 1 C
It;HIst)RHcic)1)
ASS0CiAT10N
Mayor Francis Suarez & City Commissioners
City of Miami City Hall
3500 Pan. American Drive
Miami, FL 33133
Francisco Garcia, Planing Director
City of Miami Planning Department
444 SW 2nd Avenue. 3rd floor
Miami, FL 33130
Re: Support for 5th Amendment to Miami Design District Retail Street SAP
Scptemiier 7, 2020
Duty Mayor Suarez, City Conunissioncrs and Mr. Garcia:
The Buena Vista Fart Historic Neighborhood Association has collaborated over die years with our commercial
neighbors, the Miami Design District as it has evolved into the present-day international shopping. arts and
entertainment destination.
The Design District team presented a proposed 5th Amendment to the Miami Design District Retail Strcel Special Area
Plan to neighborhood residents in September 2019, which will include (among other things):
(i) The increase: in height of the Tuttle South property at 3750 Biscayne Blvd. from 20 storks to 36 stories. The rortirie
at the Tuttle North property at 299 NE 39'' Street will remain the same with a maximum height of 20 stories. The total
gross floor arca for the Tuttle Properties will remain the same as currently allowed.
(ii) Thc developer's ability to flexibly utilize previously unused development capacity (i.e., floor area) otherwise
available under the coning regulations applicable to the SAP properties.
This letter confirms that Buena Vista Fast Historical Neighborhood Association continues to be in favor of the
above -mentioned revised 5th Amendment to Miami Design District Retail Street Special Area Plan.
Respectfully,
Robin Porter, President
Buena Vista Fast Neighborhood Association
P.Q. Box 371067, Miami, FL 33137
hv►:hnaraigmai1.com
JPPENHEIM REAL ESTATE VENTURES L.L.C.
Chad L. Oppenherm
245 NE 37' Street, Suite 102
Miami, Florida 33137
November 18, 2020
Han. Charles A. Garavaglia & Board Members
City of Miami Planning
Zoning and Appeals Board
3500 Pan American Drive
Miami, Florida 33133
Submitted Into The Record
1�EV?
Ra: Miami Design District Petal! Street SAP Amendment
Dear Chairman Garavag.:a & members of the Planning Zoning and Appeals Board.
1 own the property at 245 NE 37- Street. My property shares two property lines with the applicant's "Gateway Site
South' a.k.a. -'Tuttle South". lam deeply concerned that Pam only now hearing, for the first time, about this
application and its sweeping changes to the Design District SAP. which could result in new towers of 36 stories
ith d uble th amou t of allowable denim right next to my property.
Though this application -with its nearly 900 pages of material- appears to have been in the works for months,
neither l nor any of my other neighbors in the area were even aware that it existed. The applicant never
conducted any outreach to the neighbors that could be affected. The City also failed to let any of the stakeholders
in the area know that they were working with the applicant on these significant changes to the area.
l found out about this application just days ago when the City announced that the application would be moving
forward to a hearing before this board. l was completely blrndsided. With only a few days between the City's
announcement and the hearing. l haven't been able to review and evaluate the massive changes to the SAP being
proposed.
It would be totally unfair to move this application Forward without first giving impacted property owners Like me
an opportunity to review the proposal and understand its possible impacts, especially when there is the potential
for doubling of density. A few days prior to the hearing simply isn't enough time. Accordingly, I ask that you
please defer this application for at least 90 days to allow the community and stakeholders to have a meaningful
opportunity to review the application and discuss any concerns with the applicant and City staff before the City
takes any sort of official action.
Sincer
Chad L.