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HomeMy WebLinkAboutCRA-R-25-0030 Uni-Tower Progress Update 2025-05-22December 4th, 2024 Commissioner Damian Pardo Chairman Omni Community Redevelopment Agency 1401 N Miami Ave, 2nd Floor Miami, FL 33136 Mrs. Isiaa Jones Executive Director Omni Community Redevelopment Agency 1401 N Miami Ave, 2nd Floor Miami, FL 33136 N■ 1 M Y E S T M E N T S Re: Progress Update for `UNI Tower' (the "Project"), a Fully Restricted Affordable and Workforce Housing Development in the Omni Community Redevelopment Agency ("Omni CRA") Dear Commissioner Pardo and Mrs. Jones: We are pleased to inform you that `UNI Tower', the 28-story affordable and workforce housing luxury high-rise that we have developed within the boundaries of the Omni CRA, opened last August and is now fully operational as of December of 2024, with close to 110 occupied apartments; a significant milestone for the district and for the City of Miami as a whole. Comprising 252 units entirely restricted at the entire target income range (60, 80, 100, 120 and 140% AMI) as well as ample residential amenities, common areas, and commercial space, the Project is the first fully restricted affordable and workforce housing mixed -use skyrise in Miami. Just blocks away from Adrienne Arsht Center, next to public transportation, and steps from Wynwood, Brickell, and Edgewater, in one of the most sought-after areas in the City, `UNI' completely changes the paradigm of what affordable and workforce housing can — and should — be. We are deeply proud of, and thankful for, the Omni CRA's assistance in bringing this novel concept to fruition. Apart from decisively tackling the acute crisis of housing unaffordability, we expect the Project to become a crucial recruitment and retaining tool for businesses, organizations, government agencies, and institutions by allowing them to provide their employees with the housing they urgently deserve and need. UNI Tower fundamentally changes — indeed, elevates — the standard of what a rent restricted project can and should be: not peripheral, but within one of Miami's most coveted areas; not just "good enough", but with the equivalent quality of amenities, features, and finishes that the market -rate high-rises in the same neighborhood have. In fact, for many months now we have been working very closely with several key workforce groups in our community in order provide their employees and members with high - quality attainable housing, including: a) the State Attorney's Office, b) the Public Defender's Office, c) the Miami -Dade School Board Administration, d) the U.S. Attorney's Office, e) United 1 Teachers of Dade, f) SEIU Healthcare Florida Local 1991 (which represents 6,800 nurses and other healthcare professionals in the Jackson Health System), g) representatives of the Miami Police Department, and h) the Miami Department of Fire -Rescue. By delivering high -quality attainable housing to such organizations, agencies, and professionals, we hope to enrich the fabric of our city and neighborhood by allowing for diverse levels of income and professions, and serving those that serve our communities, in they way they deserve it. Cost Overruns and Additional Enhacing Investments The purpose of this letter is to update you on cost overruns and additional investements that were incurred, since construction began in May of 2022, in order to fulfill our shared mission of providing transformative housing in the urban core of the City and in our Omni CRA community. Some of these expenses have been unavoidable cost increases in a context of high inflation; multiple change orders impacted the Project's original budget, even after the master building permit was issued and construction began. Concrete inflation and delivery delays were particularly severe, but so have other temporary interruptions caused by unforeseen issues. Moreover, various design changes had to be implemented from initial plans and permits to conform with U.S. Department of Housing and Urban Development ("HUD") rules and the City's Code. Labor costs, which affect all trades and therefore are a substantial portion of these multiple change orders, also increased dramatically since planning of the Project began and during the course of construction. Alternatively, many of these additional expenditures had to do with our desire — and commitment — to provide the best possible residential experience within a fully restricted affordable and workforce housing tower. This is, essentially, what makes this Project stand out among other attainable housing developments in the City: with the crucial assistance of the Omni CRA, we have not only built a product that is unique in terms of location and construction type for an affordable and workforce housing project, but have done so with the finishes and amenities of a market -rate luxury high-rise. Among some of the items that are novel and unique for an affordable and workforce housing project, `UNI Tower' features: • Multiple and substantial high -end, indoor and outdoor amenity spaces, located throughout the tower, including a 3,000 SF gym and yoga room, pool, sun deck and sitting areas, beautifully furnished resident lounges, game rooms, and co -work spaces; • An expansive lobby with unique features such as gathering steps, custom artwork, and a standaout bronze staircase, a distinctive piece that serves as a focal point for the space and landmark for the building; • High -quality unit appliances, custom manufactured closets, and roller shades for enhanced privacy and lighting control; • Parking control web environment for enhanced safety, security, control, management, and operation of the building's parking garage; • Valet waiting room with incorporated amenities such as Wi-Fi and complimentary refreshments; • Automated package management system; 2 • Storage lockers distributed throughout the tower for convenient access. This way, `UNI Tower' — with the critical assistance of the Omni CRA — delivers a kind of property that sets a new high standard for future affordable and workforce housing developments in the City of Miami. It will have substantial, transformative ripple effects in the community, and will serve as inspiration for attainable housing projects here and everywhere. However, due to the nature of a rent restricted project, these additional costs cannot be absorbed through increased rents, unlike market -rate projects in the same area, which have been able to take advantage of record -rising rents in the last years. Therefore, additional economic support of the Omni CRA is essential helping to turn this inspiring vision into a tangible reality. While some would see these additional expenditures, especially on the amenities and finishes, as pure "loss" or bad business decisions, we take a different view. Incurring these expenses were the right way to bring 252 units of urgently needed affordable and workforce housing to the City's urban core, to serve the people that serve our community in the way they deserve it, and to build a product that makes them proud to live in and serves as inspiration for future developments. It's nothing more than the vision that we've shared with the Omni CRA from Day 1, a vision which, with the agency's vital support, we are achieving. Job Creation and Small Business Support Moreover, it's worth noting that UNI, which has a sizable commercial and office space component, is located within a U.S. Small Business Administration -designated HubZone. The HubZone program aims at promoting small business growth within economically disadvantaged areas by, among other things, allocating annually at least 3% of Federal government contracts ($759 billion in 2023) to HubZone-certified companies. Key benefits include: set -aside contracts, price preferences, subcontracting opportunities, and access to bonding and loans. Crucially, in order to qualify as a HubZone-certified small business, at least 35% of the applicant company's employees must also live within the HubZone. This way, by combining HubZone-located attainable residences with commercial/office space, UNI becomes an almost tailor-made solution for small businesses seeking to apply for the program's benefits. In other words, besides bringing 252 urgently needed market -rate comparable affordable and workforce housing apartments online, UNI also becomes an engine of sustainable economic growth to the Omni CRA and the City of Miami, by encouraging and allowing for the relocation of small businesses and jobs within our community. This further enriches the fabric of our Omni CRA, creating new businesses, job opportunities, and revenues for the area. Economic Assistance Sought The economic assistance received from the Omni CRA thus far equals to $10,500,000. On a per unit basis, with 252 units in the building, that amounts to approximately $41,500 per unit. With total Project costs at around $85,000,000 (or $337,500/door), the assistance of the Omni 3 CRA equals to only 12% of total unit costs, a substantially low proportion taking into consideration the type of property (high-rise, central location, market -rate quality amenities and features) that UNI is. At this point, the additional economic aid sought from the Omni CRA to help support the previously mentioned cost overruns and additional property investments is $2,500,000. We must clarify that this assistance will only go towards supporting the units within UNI Tower restricted at 60%, 80%, and 100% AMI. That equals to 30% of the Project, or 76 aparments. This extra aid exclusively for these units amounts to an additional $32,900 per door, which, combined with previous support of $41,500 per door, takes the Omni CRA funding of units at 100% AMI or lower to $74,400. With total costs per unit of $337,500, that is still only 22% of total unit costs. At less than 25% of support per door, that is still considerably low relative to the Project's cost structure. The additional economic assistance will also help in supporting the establishment of UNI as an engine for economic development and growth given its location within a HubZone and its potential to attract new businesses and jobs within the Omni CRA. With cost overruns and enhancing property investments in excess of what was originally budgeted totalling almost $5.8 million, the additional support of $2.5 million is only a fraction of the total extra costs incurred since construction began relative to initial cost estimations. As we've stated many times in the past, we are happy for, and proud of, the true partnership we have forged with the Omni CRA to build high -quality affordable and workforce housing in Miami's urban core, not in the City's periphery but within its Central Business District, and in a way that helps create a revitalized, vibrant, diverse, and sustainable community. We hope to continue to explore ways to work with the Omni CRA to advance its goals and objectives, as more often than not, those are the same as ours. Sincerely, Nir Shoshani `UNI Tower' UNI 17th Street, LLC 4