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HomeMy WebLinkAboutCRA-R-20-0014 Wynwood Haus-Cover Letter and Final CRA ProposalJuly 13,2020 Via Hand Delivery Mr. Jason Walker, Executive Director Omni Community Redevelopment Agency Historic Firehouse #2, 2nd Floor 1401 N. Miami Avenue Miami, FL 33136 Re: Wynwood Haus - Tax Increment Rebate & Grant Proposal Dear Mr. Walker: TSG Group, Lineaire Group and Wynwood Haus LLC (the "Developers") and owners of the property located within the Omni Community Redevelopment Agency ("CRA") boundaries at NE 17th Terrace and North Miami Avenue, identified by folio numbers 01-3136-003-0140; - 0150; - 0160; - 0170; - 0180; - 0190 (the "Property") are pleased to submit the enclosed Tax Increment Rebate and Grant proposal ("Proposal") for the Wynwood Haus project for your consideration. The Wynwood Haus project consists of a boutique 20-story, 224-unit for -rent development with approximately 5,200 SF of ground floor amenity retail ("Project"). The Proposal is consistent with the strategic plan and goals of the CRA Redevelopment Plan (2019 Amendment) which seeks to expand the supply of affordable and workforce housing within the CRA boundaries. Affordable and workforce housing units forming part of the Project will provide needed housing inventory to critical employees within the Miami market, including: (i) registered nurses (avg. annual salary: $56,925) (ii) teachers (median annual salary: $46,000); (iii) police officers (avg. base annual salary: $53,715); (iv) firefighters (avg. annual salary: $54,9430; (iv) hospitality service workers; and (v) recent college graduates (avg. starting salary: $50,004). The Developers have obtained site plan approval for the Project from the City of Miami, and are ready, willing and able to break ground in 2020, creating jobs and fostering growth during a period of economic uncertainty stemming from the COVID-19 global pandemic and its economic ramifications. We look forward to your favorable consideration of this Proposal and the CRA board's approval. Sincerely, Diego Bonet Wynwood Haus cc: Anthony Balzebre, Assistant Director 3 711893 7.1 07/17/2020 Wynwood Haus — CRA Proposal TSG GROUP Lineair+e Group Wynwood Haus - CRA Proposal September 16, 2020 1 Wynwood Haus — CRA Proposal PROJECT OVERVIEW TSG Group and Lineaire Group ("the Developers") are pleased to present Wynwood Haus (the "Property") for consideration to the OMNI CRA (the "CRA"). The Property is located on NE 17th Terrace and North Miami Avenue and consists of a boutique 20-story, 224-unit for -rent development with over 5,200 SF of ground floor amenity retail. Designed by local firm Corwil Architects and curated by world renowned landscape designer Enzo Enea, Wynwood Haus caters to younger generations and families attracted to the amenities and lifestyle the Arts & Entertainment and Wynwood neighborhoods offer. The Property features Studio (19%), One - Bedroom (56%), and Two -Bedroom (25%) units with world -class amenities, including a rooftop pool, lounge, and gym with stunning views of the Brickell skyline, the Miami Signature Bridge, Downtown, and the Miami Bay. Wynwood Haus' central location between the Arts & Entertainment District, Wynwood, and Downtown, and within walking distance of the Metromover rail route offers an abundance of lifestyle and entertainment options and easy access to the broader Miami metro. The Developers have already obtained Site Plan Approval from the City and are looking to break ground in Q1-2021. ALIGNMENT WITH CRA VISION Consistent with the CRA's mission, the development will achieve the following goals: (1) Enhance the quality of life of current neighborhood residents: • The entire west face of the building along North Miami Avenue will be dedicated to ground floor amenity retail space for the neighborhood. The design includes 4 retail spaces totaling 5,200+ SF (over 20% of the total ground floor footprint) with local tenants that will be carefully curated to complement the current neighborhood offerings. • The Developers have assembled a world -class team of best -in -their -field experts for the architecture, design, and landscaping and have conceptualized a building that not only complements the surrounding developments, but is also aesthetically innovative and elevates the neighborhood. All common areas, including public areas such as lobby and exteriors have been meticulously designed (please refer to attached renderings). As part of the project, the Developers will also be making a direct investment of over $500,000 in ground level landscaping, sidewalk, and road improvements for the direct benefit of the neighborhood. (2) Activate the surrounding area: • The development will add 224 for -rent units to a previously vacant and underimproved section of the neighborhood, thereby adding to the neighborhood's energy and density. • The ground floor landscaping designed by Italian/Swiss architect Enzo Enea, who was inspired by the beautiful native trees and landscaping of the adjacent Miami Historic Cemetery, will revitalize the 2 Wynwood Haus — CRA Proposal immediate area and serve as a "bridge" to connect the Arts & Entertainment and Wynwood neighborhoods — two neighborhoods that have previously not been connected for leisure pedestrian traffic (please refer to attached ground floor landscaping plans and elevations). (3) Encourage the creation of housing attainable to all: • As part of their commitment to the neighborhood and CRA's mission to foster affordability for workforce tenants, the Developers are offering to restrict the maximum rents it will charge on 100 units (45% of the total unit count) as follows: - 100% of AMI for 31 units (14% of total unit count) - 120% of AMI for 44 units (20% of total unit count) - 140% of AMI for 25 units (11% of total unit count) These rent -restricted units will be spread across the project's studios, 1-bedroom units, and 2- bedroom units, as detailed in the below table: Total Units Market Rate 100% AMI 120% AMI 140% AMI Total Workforce Total Studios 1 Bedrooms 2 Bedrooms 224 100% 124 55% 31 14% 44 20% 25 11% 100 45% 42 126 56 6 81 37 22 9 0 14 22 8 0 14 11 36 45 19 • As market rents in the neighborhood continue to rise at a faster rate than for the broader Miami market (as they are expected to, given the exponential growth of the area), these rent -restricted units will remain accessible and available for workforce tenants. The Developers are proposing to maintain these rent -restricted units through 2047 plus any additional extensions of the CRA. OTHER IMPORTANT PROJECT CONSIDERATIONS In addition to the above description regarding the Project, it is important to note the following: • The Property is "as of right" under T6-24A. The Developers did not seek to leverage additional benefits from City by up -zoning to T6-24B, as several other projects in the neighborhood have done. • Project was unanimously approved by every member of the UDRB board (7- 0) with no design comments or required revisions. • The Developers are looking to break ground Q1-2021, thereby looking to create jobs and foster growth during a period of economic uncertainty / projected recession as a result of the COVID-19 pandemic crisis, helping to offset its potential impact on the neighborhood. 3 Wynwood Haus — CRA Proposal CRA PROPOSAL In order to be able to carry out the proposed Project, the Developers are seeking the financial support of the CRA. Total impact fees, permitting fees, and streetscape/sidewalk improvements — including the ground floor landscaping designed by Enzo Enea — are projected to cost over $3.8M. In addition, the above -mentioned rent restrictions represent a present value in loss of income of $8.3M. In exchange, and to partially help offset the loss in income, the Developers are requesting: (1) A rebate of 95% of the TIF collected by the CRA during its anticipated term through 2047 plus any additional extensions of the CRA. This benefit represents a present value of $6,387,662. See TIF Analysis Report prepared by Larry M. Spring, Jr., CPA attached hereto as Exhibit "A". (2) A cash grant of $1.1M ($4,911 / unit) paid out in equal quarterly installments over 3 years ($91,666.66 per quarter for 12 quarters). The Developers are also offering to give back to the CRA 3.0% of all retail gross rent proceeds that the Developer collects from the Property's ground -floor retail during the initial 15 year period after completion of the development. BACKGROUND ON DEVELOPERS Founded in 2008, TSG is a real estate investment and development firm focused on understanding urban markets and transforming lives. Inspired by the communities in which the firm develops, TSG's goal is to create experiences that will help them grow. TSG Group's distinguished real estate development portfolio includes Ofizzina, a Class A office condo building in Coral Gables; Cassa Brickell, an 80-unit boutique condo building, and Cassa at Georgetown townhome community near Fort Lauderdale. Additionally, TSG Group's Land Banking division has acquired large amounts of land in strategically located areas of Miami, including the Design District, the Miami River, Brickell, Edgewater and the Health District. Through its strategic partner Black Salmon, the group acquires real estate opportunities in main markets of the United States and transforms the assets into profitable, risk - adjusted returns for a select group of investors. Black Salmon's team of professionals manages the portfolio of assets to maximize the operational efficiency and profitability of each asset. Lineaire Group was founded with the goal of combining an institutional investment approach with disciplined risk management, and a cutting -edge architectural design and project management team. This unique combination allows the company to turn complex, often overlooked projects into high - performing assets, and to deliver investors superior risk -adjusted returns. The group focuses on value- add/repositioning opportunities and development opportunities. Recent acquisitions include 316 E 55th St. multifamily building in New York, 10 New River in Fort Lauderdale, and a portfolio of historic residential condominiums in Miami Beach. Lineaire Group also operates alongside its sister company, Lineaire Designs, which serves as an in-house design and construction division. In the last three years alone, Lineaire Designs has successfully completed 300+ apartment projects in buildings in the South Florida luxury market, including Aria on the Bay and Marquis Residences, among others. In addition to more accurate underwriting, having a team of experts across industries servicing a project from inception to completion ensures streamlined execution. 4 Wynwood Haus — CRA Proposal EXTERIOR DESIGN RENDERINGS View from southwest corner 5 nwoo. Haus—CRA Pro.osa 111111111111 J j 112111111I1! Jr Jt . Kidd from nort^ Wynwood Haus — CRA Proposal INTERIOR DESIGN RENDERINGS Residential Lobby Tenant mailroom 7 Wynwood Haus — CRA Proposal Rooftop amenity space Rooftop amenity space 8 Wynwood Haus — CRA Proposal Rooftop amenity space Rooftop amenity space 9 Wynwood Haus — CRA Proposal GROUND FLOOR LANDSCAPING PLANTING ENEA POTS STRIPED FAIRWAY OUTDOOR SEATING Ground floor landscaping plan view LOBBY ENTRANCE NE 17TN TERRACE (SECONDARY FRONTAGE VINES ON COLUMNS gin 4 PROPERTY LINE COBBLE STONE DRIVEWAY 10 South elevation West elevation 11 Wynwood Haus — CRA Proposal Elf[daheit 1 Ca esipinia goo] Dwarf Wild Coffee (Psychortria nerarosgl SHRUBS AND VINES Mahogany itysikamasabkyl Emefald Blanket Orartssa macrocarpap Ground floor landscaping plant species He an White Fountain Grass (Penn setum seta: eum'alba) Star Jasmine (Trache lospe r rou m ja s min °ides' Orange kugainm11 f8ougai nvillea spP I 12 Wynwood Haus — CRA Proposal (SECONDARY FRONTAGE) Rooftop amenity floor landscaping plan view PROPERTY LINE 13 Wynwood Haus — CRA Proposal SAMPLE UNIT RENDERINGS Sample 2-bedroom Sample 1-bedroom 14 Wynwood Haus — CRA Proposal Sample studio 15 MEM Gouty Tax Increment City Tax Increment Total Tax Increment OMNI CLAWBACK Net Available to CRA New Tax Roll less Tax Roll less Tax Roll less Construction Estimated Tax Tax Roll Base time Base time Base time Roll Year Inflationary Coming onto Roll for Next Less Base of County City Combined Millages Combined Millages Combined Millages 35°A of Total Increment (Jan 1) FY Prel Tax Roll Growth of Roll Tax Roll Year Millage Millage Times 95% Times 95% Times 95% 95% of Available Net TIF 2021 2022 5,195,117 155,854 5,350,971 0 0.4667% 0.7567% 0 0 0 0 0 0 2022 2023 5,350,971 160,529 51,968,000 57,479,500 155,854 0.4667% 0.7567% 691 1,120 1,811 634 1,177 1,118 2023 2024 57,479,500 1,724,385 59,203,885 52,284,383 0.4667% 0.7567% 231,806 375,829 607,635 212,672 394,963 375,215 2024 2025 59,203,885 1,776,117 60,980,001 54,008,768 0.4667% 0.7567% 239,451 388,224 627,675 219,686 407,989 387,590 2025 2026 60,980,001 1,829,400 62,809,401 55,784,884 0.4667% 0.7567% 247,325 400,992 648,317 226,911 421,406 400,336 2026 2027 62,809,401 1,884,282 64,693,683 57,614,284 0.4667% 0.7567% 255,436 414,142 669,578 234,352 435,225 413,464 2027 2028 64,693,683 1,940,810 66,634,494 59,498,566 0.4667% 0.7567% 263,790 427,686 691,476 242,017 449,460 426,987 2028 2029 66,634,494 1,999,035 68,633,529 61,439,377 0.4667% 0.7567% 272,395 441,637 714,032 249,911 464,121 440,915 2030 2031 70,692,534 2,120,776 72,813,310 65,497,417 0.4667% 0.7567% 290,386 470,807 761,193 266,418 494,776 470,037 2031 2032 72,813,310 2,184,399 74,997,710 67,618,193 0.4667% 0.7567% 299,789 486,051 785,840 275,044 510,796 485,256 2032 2033 74,997,710 2,249,931 77,247,641 69,802,593 0.4667% 0.7567% 309,474 501,753 811,227 283,929 527,297 500,933 2033 2034 77,247,641 2,317,429 79,565,070 72,052,524 0.4667% 0.7567% 319,449 517,926 837,375 293,081 544,294 517,079 2034 2035 79,565,070 2,386,952 81,952,022 74,369,953 0.4667% 0.7567% 329,723 534,584 864,308 302,508 561,800 533,710 2035 2036 81,952,022 2,458,561 84,410,583 76,756,905 0.4667% 0.7567% 340,306 551,742 892,048 312,217 579,831 550,840 2036 2037 84,410,583 2,532,317 86,942,901 79,215,466 0.4667% 0.7567% 351,206 569,415 920,621 322,217 598,403 568,483 2037 2038 86,942,901 2,608,287 89,551,188 81,747,784 0.4667% 0.7567% 362,433 587,617 950,051 332,518 617,533 586,656 2038 2039 89,551,188 2,686,536 92,237,723 84,356,071 0.4667% 0.7567% 373,997 606,366 980,363 343,127 637,236 605,374 2039 2040 92,237,723 2,767,132 95,004,855 87,042,606 0.4667% 0.7567% 385,908 625,677 1,011,586 354,055 657,531 624,654 2040 2041 95,004,855 2,850,146 97,855,001 89,809,738 0.4667% 0.7567% 398,176 645,568 1,043,745 365,311 678,434 644,512 2041 2042 97,855,001 2,935,650 100,790,651 92,659,884 0.4667% 0.7567% 410,813 666,055 1,076,868 376,904 699,964 664,966 2042 2043 100,790,651 3,023,720 103,814,370 95,595,534 0.4667% 0.7567% 423,828 687,157 1,110,985 388,845 722,141 686,034 2043 2044 103,814,370 3,114,431 106,928,801 98,619,253 0.4667% 0.7587% 437,234 710,766 1,148,000 401,800 746,200 708,890 2044 2045 106,928,801 3,207,864 110,136,665 101,733,684 0.4667% 0.7587% 451,042 733,212 1,184,254 414,489 769,765 731,277 2045 2046 110,136,665 3,304,100 113,440,765 104,941,548 0.4667% 0.7587% 465,264 756,332 1,221,596 427,559 794,038 754,336 2046 2047 113,440,765 3,403,223 116,843,988 108,245,648 0.4667% 0.7587% 479,913 780,145 1,260,058 441,020 819,038 778,086 EXHIBIT "A"