HomeMy WebLinkAboutBack-Up Document - ReportMiami City Commission Report
R-16-0059
For the City Owned Property Located at:
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401 Biscayne Blvd
Miami, FL 33132
For Outdoor Seating for Crocodile Cantina, Inc.
DBA Mambo Cafe
Report on Outdoor Seating Area at Mambo Cafe
R-16-0059
An item was brought to the Miami City Commission on 2/11/16 which authorized the City Manager to
execute a Revocable License for dockside restaurant seating with Crocodile Cantina, Inc. d/b/a Mambo
Cafe. The item was passed with the direction by the commission to bring back a report to Commission to
analyze the following:
1. Q - Whether or not the additional outdoor seating provided by the Revocable License generates
enough revenue to allow the restaurant to provide its employees with a $15.00 per hour
minimum wage.
A - The Department of Real Estate and Asset Management has met with the Licensee and
discussed whether or not the additional 4 tables added by the outdoor seating from the License
Agreement brought in enough revenue to enable him to pay all of his employees a minimum
wage of $15.00 per hour and his answer was no. Let's assume that the restaurant has 2 bus boys
and 2 hostesses that all make $8.50 per hour. At 40 hours per week for each employee for 52
weeks a year, bringing their salaries up to $15.00 per hour would equate to an additional
$54,080 per year in salaries. This would not be in the best interest of the restaurant for an
additional 4 tables of outdoor seating. The Licensee did provide evidence from their payroll
company that their servers currently make over $15.00 per hour when factoring tips into the
equation.
2. Q - Whether or not the rent being charged through the revocable license agreement is fair
market value.
A— The outdoor seating in question is a unique situation that you will not commonly find in the
real estate market. Typically, outdoor seating is only going to be able to be used by the Tenant
who leases the adjoining space, therefore it is most often thrown in as part of the overall deal to
make the space more desirable and achieve a greater rent amount on the entire space. For
example, let's assume a landlord has 2 identical spaces of 2,000 SF under air conditioning but
one of them has an additional 750 SF of outdoor seating. If the asking rent for the space without
outdoor seating was $30.00 per square foot, then the landlord would most likely ask $35-$40
per square foot for the space with the outdoor seating. The rent would then be calculated on
the 2,000 SF for both spaces, just a higher asking amount for the space with additional outdoor
seating. Upon the review of the appraisal done by Joseph J. Blake and Associates, Inc., the
Department of Real Estate and Asset Management has concluded that the rent currently being
paid by the Licensee if above fair market.
Please find a photo of the area in question attached
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