Miami Beach has made headway in its efforts to incentivize development of Class A office space as one way to diversify an economy heavily dependent on a tourism and hospitality industry recently battered by hurricanes, Zika, and the COVID-19 pandemic. Following approvals of projects by Related Group on Terminal Island and Deco Capital in Sunset Harbour, City Commissioners this week will consider legislation to allow additional office development in Sunset Harbour and on portions of Alton Road.
In the pipeline, potential office uses for City-owned parking lots and a garage adjacent to Lincoln Road. Commissioners will consider a formal Request for Proposals following strong interest to an earlier Request for Letters of Interest.
They will also discuss a recommendation from the 41st Street Committee for a similar RFP for City-owned lots adjacent to 41st Street.
In a memo to Commissioners accompanying the Alton Road legislation, City Manager Alina Hudak cited an analysis from consultant CBRE regarding office space in the City. She noted:
Total Class A space – 937,526 SF with 9% vacancy
Total Class B space – 892,885 SF with 11% vacancy
South of Fifth Street – Approx. 400,000 SF of Class A & B space
Lincoln Road (including adjacent side streets) – approx. 1.13 million SF of Class A & B space
“As it pertains to the migration of office tenants from the northeast (e.g. New York and Connecticut) and Chicago to the greater Miami area (212 to 305), the Administration has discussed this with CBRE, who was able to provide some anecdotal data regarding leasing they have done in the larger office market area,” Hudak wrote.” In general, there appears to be a meaningful increase in interest from financial services and related firms, some of which are focused on the greater Miami market, and others in downtown West Palm Beach.”
Sunset Harbour Overlay with Office IncentivesCommissioners approved an Overlay district for Sunset Harbour on first reading in May which provides a height increase to 65 feet for office uses on properties fronting Dade Boulevard between Alton Road and Bay Road, properties fronting Alton Road between 20th Street and Dade Boulevard as well as those fronting Purdy Avenue between 18th Street and Dade Boulevard.
The Overlay also includes a prohibition on hotels. At first reading, Commissioners agreed to an exception for developer Ronny Finvarb to move forward with a suite hotel at Dade Boulevard and Alton Road, though they asked Finvarb to work with the community to address their concerns about the hotel prior to second reading.
Second and final reading with public hearing is expected at 5:00 pm. Item R5I
Update: Commissioners asked the Sunset Harbour Neighborhood Association and the developer to have a dialogue to discuss concerns. They had asked for that prior to this meeting but the developer's attorney Mickey Marrero said he reached out but the Association was non-responsive. At the Commission's urging, the Association indicated they would sit down for a discussion. To be continued...
Alton Road Office Development OverlayAfter nearly a year of discussion, Commissioners will consider a new Office Development Overlay for portions of the Alton Road CD-2 District with the intent to incentivize high-end offices. The ordinance would increase maximum building height from 50 feet and 60 feet to 75 feet on the west side of Alton Road between 8th Street and 11th Street and between 14th Street and 17th Street.
To ensure office development, a minimum threshold of office use is incorporated into the ordinance. In her memo to Commissioners, Hudak noted, “Additionally, a minimum lot size of 7,500 square feet is proposed to ensure that the higher height is for medium to large size office projects, and so that the site is large enough to absorb the increase in height. Collectively these thresholds will help ensure the increased height will be limited to projects that consist primarily of offices.”
Though the maximum building height could be 75 feet, the ordinance requires a minimum setback of 20 feet from the rear property line for portions of the building above 60 feet in height.
The ordinance also contains a sunset provision applying the development regulations only to projects that have obtained a full building permit by December 31, 2026. [City staff corrected this at the Commission meeting, saying there was a typo in the memo accompanying the item. The proposed sunset date is December 31, 2031.]
“The proposed increase in height would allow for the expanded interior floor to ceiling space being sought by office users and office developers,” Hudak states in her memo. “The proposal would help diversify the City’s economy and is consistent with the concept of transit-oriented development (TOD), which is ideal for the identified area. This is an important point because the City’s long-term mobility plan places considerably more emphasis on transit. In turn, this will likely result in less of a need for onsite vehicular storage in the future, which would equate to a reduction in overall building height.”
Alton Road Office Development Overlay, first reading, 10:05 am, Item R5A
Update: Passed on first reading; second reading July 28
After the City received 18 positive responses to its Request for Letters of Interest to develop Class A office space on three City-owned lots on Lincoln Lane North adjacent to Lincoln Road, Commissioners directed the Administration to issue a formal Request for Proposals (RFP) for the surface parking lots and to add the 17th Street garage to mix.
Lincoln Lane and 17th Street Garage RFP for Office Development
Commissioners will consider approval of the RFP prepared by the Administration at its Wednesday meeting. The item, C2B, is on what is known as the Consent Agenda so it may be voted on in a block with all items on the consent agenda or may be pulled by the Mayor or any Commissioner for discussion.
Update: The RFP was approved and will go out to bidders
41st Street Committee recommendation re Class A OfficeFinally, Commissioner Ricky Arriola has added a discussion item following a recommendation from the Mayor’s 41st Street Committee that the Commission authorize the issuance of a request for proposals to repurpose the City-owned parking lots adjacent to 41st Street into Class A office space.
“I am asking that the Commission provide the administration with the direction to begin crafting a RFP for these surface parking lots due to the incredible response the City received with its Lincoln Road Office Space RFLI and the overwhelming regional demand for office space,” Arriola wrote in a memo to Commissioners.
Discussion item R9L. Item here.
Update: Commissioners ran out of time and will discuss this next month
The Commission meeting begins at 8:30 am on Wednesday, June 23. It is a hybrid in-person and Zoom meeting. Details for participating in the meeting and full agenda can be found here.
Photo: Alton Road and Dade Boulevard. The west side of Alton between 14th and 17th Streets is one area under consideration for office development. Credit: Felix Mizioznikov / Shutterstock.com