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HomeMy WebLinkAboutAgenda Item Summary FormAGENDA ITEM SUMMARY FORM File ID: #3337 Date: 11/28/2017 Requesting Department: Department of Real Estate and Asset Management Commission Meeting Date: 12/14/2017 Sponsored By: District Impacted: District 2 Type: Resolution Subject: Authorize Amendment No. 5 - Aligned Bayshore Marina, LLC Purpose of Item: A Resolution of the City of Miami Commission, with attachment(s), authorizing the City Manager to execute a fifth amendment ("Amendment") to the Lease Agreement between the City of Miami ("City") and Aligned Bayshore Marina, LLC ("Company"), in substantially the attached form, for City -owned property located 2550 South Bayshore Drive, Miami, Florida, to modify certain provisions of the Lease as stated herein, including the extension of the current Lease Term by an additional term of approximately Thirty -Two (32) years, with Two additional Ten (10) year options; an additional Minimum Rent payment of Two Hundred Thousand Dollars ($200,000) per lease year, or One and Three Quarters Percent (1.75%) of Gross Receipts derived from the Property, whichever is greater, beginning in 2019; increasing the Minimum Guaranteed Rent to One Million Five Hundred Thousand Dollars ($1,500.000.00) beginning in 2019, a donation of Twenty -Five Thousand Dollars ($25,000.00) per year, beginning in 2019, to support low income housing renovations; a minimum of Seven Million Five Hundred Thousand Dollars ($7,500,000) in capital improvements to the Property; with additional terms and conditions as more particularly set forth in the Amendment. Background of Item: The City entered into a Lease Agreement with Bayshore Properties, Inc. ("BPI"), on September 20, 1985, and authorized by City Commission Resolution No. 85-717, adopted July 18, 1985, with related ballot language approved by referendum of voters on August 13, 1985. That certain Lease Agreement was assigned by the prior Lessee to the Company by that certain Assignment and Assumption of Master Lease dated April 8, 2015 and that certain Consent to Assignment dated April 15, 2015. The City and the Company wish to enter into the Fifth Amendment to the Lease Agreement which will extend the term of the Lease Agreement by approximately Thirty - Two (32) years and Two additional Ten (10) year options in exchange for Additional Rent which shall include a minimum of Two Hundred Thousand dollars ($200,000) per lease year, or One and Three Quarters Percent (1.75%) of total Annual Gross Sales of the leasehold, whichever is greater beginning in 2019, increase the Minimum Guaranteed Rent to One Million Five Hundred Thousand Dollars ($1,500.000.00) beginning in 2019, a donation of Twenty -Five Thousand Dollars ($25,000.00) per year, beginning with 2019, to support low income housing renovations, significant capital improvements to the property, the creation of a capital account, implementation of a transfer fee if the property is transferred or assigned, and a refinancing fee should the property be refinanced after the initial refinancing. The City has received Two (2) independent appraisals that have determined the rent amounts within the Fifth Amendment to be at or above fair market value. In addition to and at the same time as the annual donation by the Company to support low income housing renovations, the City will donate One Half of One Percent (0.05%) of the revenue generated by this Lease each year, to support low income housing renovations. On November 6th, 2017, the citizens of the City of Miami voted in a special election, to the give the Miami City Commission the power by a Four -Fifths (4/5ths) affirmative vote to waive competitive bidding and to execute this Amendment to extend the term of the Lease Agreement pursuant to this Amendment. Budget Impact Analysis Item is Related to Revenue Item is NOT funded by Bonds Total Fiscal Impact: $200,000.00 estimated additional revenue to the City annually Reviewed By Real Estate and Asset Management Mark Burns Office of Management and Budget Everton Garvis Office of Management and Budget Christopher M Rose City Manager's Office Alberto N. Parjus Legislative Division Valentin J Alvarez City Manager's Office Daniel J. Alfonso Office of the City Attorney Valentin J Alvarez Office of the City Attorney Victoria Mendez City Commission Nicole Ewan Office of the Mayor Mayor's Office Office of the City Clerk City Clerk's Office Legislative Division Valentin J Alvarez Office of the City Attorney Barnaby L. Min Office of the City Attorney Victoria Mendez Office of the City Clerk City Clerk's Office Department Head Review Completed 11/28/2017 12:38 PM Budget Analyst Review Completed 11/28/2017 1:14 PM Budget Review Completed 11/30/2017 9:06 AM Assistant City Manager Review Completed 11/30/2017 9:53 AM Legislative Division Review Completed 11/30/2017 12:50 PM City Manager Review Completed 12/02/2017 8:12 AM Deputy City Attorney Review Skipped 12/04/2017 11:07 AM Approved Form and Correctness Completed 12/05/2017 6:29 PM Meeting Completed 12/14/2017 9:00 AM Signed by the Mayor Completed 12/14/2017 7:22 PM Signed and Attested by the City Clerk Completed 12/14/2017 7:23 PM Legislative Division Review Completed 12/20/2017 1:24 PM Deputy Attorney Review Completed 12/20/2017 3:22 PM Approved Form and Correctness with Modification(s) Completed Rendered Completed 12/21/2017 12:39 PM File Number: 3337 City of Miami Legislation Resolution Enactment Number: R-17-0594 City Hall 3500 Pan American Drive Miami, FL 33133 www.miamigov.com Final Action Date:12/14/2017 A RESOLUTION OF THE MIAMI CITY COMMISSION, WITH ATTACHMENT(S), OFFICIALLY ACKNOWLEDGING THE CITY CLERK'S CERTIFICATION OF THE RESULTS OF THE REFERENDUM SPECIAL ELECTION HELD ON NOVEMBER 7, 2017, AS APPROVED PURSUANT TO RESOLUTION NO. 17- 0575 ADOPTED DECEMBER 14, 2017, FOR A CHARTER AMENDMENT AMENDING THE CHARTER OF THE CITY OF MIAMI, FLORIDA, AS AMENDED ("CHARTER") BY AMENDING SECTION 29-B OF THE CHARTER, ENTITLED "CITY -OWNED PROPERTY SALE OR LEASE -GENERALLY", TO AUTHORIZE THE CITY MANAGER BY A FOUR-FIFTHS (4/5THS) AFFIRMATIVE VOTE OF THE CITY COMMISSION ("COMMISSION") TO WAIVE COMPETITIVE BIDDING AND TO EXECUTE A FIFTH AMENDMENT ("FIFTH AMENDMENT") TO THE LEASE AGREEMENT ("LEASE") BETWEEN THE CITY OF MIAMI ("CITY") AND ALIGNED BAYSHORE MARINA, LLC ("BAYSHORE MARINA"), ALSO KNOWN AS MONTY'S, FOR CITY -OWNED WATERFRONT PROPERTY LOCATED AT 2550 SOUTH BAYSHORE DRIVE, MIAMI, FLORIDA ("PROPERTY"), TO EXTEND THE CURRENT LEASE TERM BY AN ADDITIONAL TERM OF APPROXIMATELY THIRTY-TWO (32) YEARS (TO EXPIRE MAY 31, 2067) WITH TWO (2) ADDITIONAL TEN (10) YEAR OPTIONS TO RENEW FOR A TOTAL TERM OF FIFTY TWO (52) YEARS (TO EXPIRE MAY 31, 2087); AN ADDITIONAL MINIMUM RENT PAYMENT OF TWO HUNDRED THOUSAND DOLLARS ($200,000.00) PER LEASE YEAR (A MINIMUM OF TEN MILLION DOLLARS [$10,000,000.00] OVER THE BASE TERM OF THE AMENDED LEASE) OR ONE AND THREE QUARTERS PERCENT (1.75%) OF GROSS RENT RECEIPTS FROM THE PROPERTY, WHICHEVER IS GREATER, AS ADDITIONAL RENT DUE TO THE CITY AND, COMMENCING JANUARY 1, 2019, MINIMUM ANNUAL TOTAL RENT (INCLUSIVE OF THE ADDITIONAL MINIMUM RENT) SHALL BE ONE MILLION FIVE HUNDRED THOUSAND DOLLARS ($1,500,000.00), PLUS AN ADDITIONAL TWENTY FIVE THOUSAND DOLLARS ($25,000.00) TO BE PAID ON AN ANNUAL BASIS FOR THE FULL AMENDED TERM TO A SPECIAL FUND TO BE ESTABLISHED BY THE CITY FOR THE BENEFIT OF LOW INCOME HOUSING RENOVATION; FURTHER PROVIDING CAPITAL IMPROVEMENTS TO THE PROPERTY OF A MINIMUM OF SEVEN MILLION FIVE HUNDRED THOUSAND DOLLARS ($7,500,000.00) TO BE SPENT WITHIN THREE (3) YEARS OF THE ELECTORATE'S APPROVAL OF THE FIFTH AMENDMENT TO THE LEASE; THE CREATION OF A CAPITAL ACCOUNT REQUIRING A MINIMUM ADDITIONAL INVESTMENT IN THE PROPERTY OF FOUR MILLION DOLLARS ($4,000,000.00) OVER THE TOTAL AMENDED LEASE TERM INCLUSIVE OF THE RENEWAL OPTIONS; REQUIRING A TRANSFER FEE PAYMENT TO THE CITY IF THE PROPERTY IS TRANSFERRED OR ASSIGNED; AND FURTHER REQUIRING A REFINANCING FEE PAYMENT TO THE CITY SHOULD THE PROPERTY BE REFINANCED AFTER THE INITIAL REFINANCING; AND PURSUANT TO SECTION 29-B OF THE CHARTER, ENTITLED "CITY OWNED PROPERTY SALE OR LEASE -GENERALLY," AND SUBPART A, SECTION 3(F)(III), ENTITLED "POWERS," TWO (2) INDEPENDENT APPRAISALS HAVING BEEN OBTAINED BY THE CITY AFFIRMING FAIR MARKET VALUE OF THE PROPERTY; ACKNOWLEDGING THE CITY'S SEPARATE AUTHORIZATION BY RESOLUTION NO. 17-0323 ADOPTED JULY 13, 2017 OF THE CITY'S RELATED MODIFICATION OF SUBMERGED LANDS LEASE AND WAIVER OF DEED RESTRICTIONS REQUIRED WITH THE STATE OF FLORIDA, BOARD OF TRUSTEES OF THE INTERNAL IMPROVEMENT TRUST FUND, AND OTHER RESTRICTIONS, REVERSIONS, AND RETENTION BY THE CITY OF ALL OTHER RIGHTS. WHEREAS, the City of Miami ("City") is the owner of the waterfront property located at 2550 South Bayshore Drive, Miami, Florida ("Property"); and WHEREAS, pursuant to the Lease Agreement originally dated September 20, 1985, as supplemented and amended ("Lease"), Aligned Bayshore Marina LLC ("Bayshore Marina") currently leases the Property, also known as Monty's, from the City; and WHEREAS, the City and Bayshore Marina desire to enter into a Fifth Amendment to the Lease which will extend the current lease term by an additional term of approximately thirty-two (32) years (to expire May 31, 2067) with two (2) ten (10) year options to renew for a total term of fifty-two (52) years (to expire May 31, 2087); increase minimum rent payment by an additional two hundred thousand dollars ($200,000.00) per lease year for a minimum of ten million dollars ($10,000,000.00) over the base term of fifty (50) years or one and three quarters percent (1.75%) of gross rent receipts from the Property, whichever is greater, as additional rent due to the City, and commencing January 1, 2019, minimum annual total rent (inclusive of the additional minimum rent) shall be one million five hundred thousand dollars ($1,500,000.00), plus an additional twenty five thousand dollars ($25,000.00) to be paid on an annual basis for the full amended term to a special fund to be established by the City for the benefit of low income housing renovation; further providing capital improvements to the Property of a minimum of seven million five hundred thousand dollars ($7,500,000.00) to be spent within three (3) years of the electorate's approval of the Fifth Amendment to the Lease; further creating a capital account requiring a minimum additional investment in the Property of four million dollars ($4,000,000.00) over the total amended Lease term inclusive of the renewal options; requiring a Transfer Fee payment to the City if the Property is transferred or assigned; and further requiring a Refinancing Fee payment to the City should the Property be refinanced after the initial refinancing; and WHEREAS, of the additional rent due to the City generated annually by this Lease, the City will donate one half of one percent (0.5%) of these revenues towards the same special fund to be established by the City for the benefit of low income housing renovation; and WHEREAS, pursuant Section 29-B of the Charter of the City of Miami, Florida, as amended, ("Charter"), entitled "City Owned Property Sale or Lease -Generally", and Subpart A, Section 3(f)(iii), entitled "Powers", the City has received two (2) independent appraisals affirming the fair market value of the Property; and WHEREAS, in a separate but related matter, (1) the City Commission on July 13, 2017 adopted Resolution No. 17-0323 authorizing the City Manager to negotiate and execute the required Modification of Submerged Lands Lease ("Submerged Lands Lease") and Waiver of Deed Restrictions ("State Waiver") with the State of Florida, Board of Trustees of the Internal Improvement Trust Fund ("State") for the submerged lands areas related to the Property ("Submerged Lands"), (2) the State has previously acknowledged Bayshore Marina's Lease with the City, Bayshore Marina's subleasing of the Submerged Lands, and improvements contemplated to be undertaken by Bayshore Marina on the Submerged Lands, and (3) once the City and the State have executed the Submerged Lands Lease and the State Waiver, the City and Bayshore Marina will execute the related sublease for the Submerged Lands with required restrictions, reversions, and retention by the City of all other rights; and WHEREAS, the City Commission ("Commission") has determined that the Fifth Amendment to the Lease is in the City's best interest; and WHEREAS, on November 6, 2017, qualified electors of the City voted in a Referendum Special Election authorizing the Commission by a four-fifths (4/5ths) affirmative vote to waive competitive bidding and to proceed with execution of the Fifth Amendment to the Lease; and WHEREAS, the Commission officially acknowledged the City Clerk's certification of the results of the Referendum Special Election held on November 7, 2017, as approved pursuant to Resolution No. 17-0575 adopted December 14, 2017; NOW, THEREFORE, BE IT RESOLVED BY THE COMMISSION OF THE CITY OF MIAMI, FLORIDA: 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. Pursuant to the City Clerk's certification of the results of the Referendum Special Election held on November 7, 2017 as approved pursuant to Resolution No. 17-0575 adopted December 14, 2017, the City Manager is hereby authorized by a four-fifths (4/5ths) affirmative vote of the Commission to waive competitive bidding and to execute a Fifth Amendment to the Lease between the City and Bayshore Marina for the Property extending the current Lease term by an additional term of approximately thirty two (32) years (to expire May 31, 2067) with two (2) additional ten (10) year options to renew for a total term of fifty two (52) years (to expire May 31, 2087); for an additional payment of two hundred thousand dollars ($200,000.00) per Lease year (a minimum of ten million dollars [$10,000,000.00] over the base term of the amended Lease) or one and three quarters percent (1.75%) of gross rent receipts from the Property, whichever is greater, as additional rent due to the City and, commencing January 1, 2019, minimum annual total rent (inclusive of the additional minimum rent) shall be one million five hundred thousand dollars ($1,500,000.00), plus an additional twenty five thousand dollars ($25,000.00) to be paid on an annual basis for the full amended term to a special fund to be established by the City for the benefit of low income housing renovation; further providing capital improvements to the Property of a minimum of seven million five hundred thousand dollars ($7,500,000.00) to be spent within three (3) years of the electorate's approval of the Fifth Amendment to the Lease; the creation of a capital account requiring a minimum additional investment in the Property of four million dollars ($4,000,000.00) over the total amended Lease term inclusive of the renewal options; requiring a transfer fee payment to the City if the Property is transferred or assigned; and further requiring a refinancing fee payment to the City should the Property be refinanced after the initial refinancing. Section 3. Pursuant to Section 29-B of the Charter, entitled "City owned property sale or lease — Generally" and Subpart A, Section 3(f)(iii), entitled "Powers", receipt of two (2) independent appraisals obtained by the City affirming the fair market value of the Property is hereby acknowledged. Section 4. The City's separate authorization by Resolution No. 17-0323 adopted July 13, 2017 for the City's related modification of the submerged lands lease and waiver of deed restrictions required with the State of Florida, Board of Trustees of the Internal Improvement Trust Fund, and other restrictions, reversions, and retention by the City of all other rights is hereby acknowledged. Section 5. This Resolution shall become effective immediately upon its adoption and signature of the Mayor.' APPROVED AS TO FORM AND CORRECTNESS: 1 ria ndez, ity ttor ey 121512017 ' If the Mayor does not sign this Resolution, it shall become effective at the end of ten (10) 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.