After five years, Related Group Chairman and CEO Jorge Pérez hopes he’s hit on the right formula to develop a nearly four-acre parcel on the southeastern tip of Miami Beach’s Terminal Island. He’s proposing a tall, skinny luxury condo tower of no more than 90 units and, in exchange for changes in Miami Beach’s Land Use Development Regulations to allow residential use on the currently zoned industrial property, he’s proffering a new state-of-the-art Fleet Management facility for the City. This time he has the support of a prominent residents’ organization, the South of Fifth Neighborhood Association (SOFNA). Still to be convinced, the U.S. Coast Guard.
The latest proposal is for a 457-foot tall, 34 story tower that is now oriented so that its thinnest side faces South Pointe and its broad side faces east to the ocean and west toward the City of Miami (above). Two years ago, Pérez proposed a 25-story, 90-unit tower with a deep-water large-yacht marina but was challenged by the Coast Guard on the incompatibility of residential living with the noisy, industrial processes of the Coast Guard as well as concerns over security and the Coast Guard’s ability to serve the public.
Related Group attorney Tracy Slavens told Miami Beach Commissioners this week, “It’s distinctive location is the reason why Related Group has stepped in to develop the project and it’s going to be one of its most prestigious projects to date.” The development known as One Island Park would generate an estimated $2.9 million in annual tax revenue for the City, she said.
In addition to allowing residential use on the property, Related is asking to combine the FAR (Floor Area Ratio or density) of several parcels into the area where the tower is proposed to allow for the increased height. Currently the allowable building height there is 40 feet. The concept is similar to the one employed by developer Russell Galbut who received approval to consolidate the FAR on the 500 and 600 blocks of Alton Road for his proposed Park on Fifth project. Galbut was approved for a 519-foot tower in exchange for a three-acre public park. In the rendering below, Park on Fifth is the oval building across the Bay from the proposed Terminal Island project. Both buildings are designed by Arquitectonica.
For the Terminal Island project, Related is offering additional land which would both expand the Fleet Management facility and allow a phased construction schedule so that operations could continue without interruption. Construction would be completely funded by Related. Slavens told RE:MiamiBeach, the value of the new facility is “an estimated $18 million.”
A video produced by the developer provided an overview of the benefits to the City. It noted that Related Group stopped the parcel’s use as a cargo facility in 2016 which “eliminated 125,000 semi-truck trips annually” across the MacArthur Causeway.
Headquarters to the Fleet Management Department and Sanitation Division, the facility services more than 1,000 City vehicles and other specialized equipment. It also houses the only City-owned fueling station. Due to its limited capacity, “up to 75 vehicles” park along the roadway and in the right of way in front of the facility while other employees and City service vehicles park in public parking garages, utilizing spaces that are intended to generate revenue for the City.
The new facility proposed by Related would include over 50,000 sq ft of administrative offices, regular and oversized vehicle service bays, an upgraded fuel station with backup generation capacity, and a parking garage to house vehicles currently being parked throughout the city.
Pérez recalled how he started out in Miami Beach over 40 years ago. Since then has built a number of luxury towers, many of them in the South of Fifth neighborhood including Apogee, One Ocean, Icon, and Murano Grande.
“We’ve had a long history in Miami Beach,” he said. “We like to think of ourselves as legacy builders. When I saw this opportunity, it was an opportunity to do something that was very impactful, that would open an iconic building at the entrance of Miami Beach.”
Pérez told Commissioners he could build a large “four-story office or warehouse that covers most of the site, 150,000 sq ft as of right” which he said would generate 376% more traffic than the proposed residential tower though he said the traffic would likely be much less because “experience shows that about a third of the residential tower will be permanent residents and two-thirds would be second homeowners initially from the Northeast or Latin America.”
He called the proposal “a real win-win situation. Iconic building, just sort of a light at the end of Miami Beach, one in which we use very little of the parcel.”
Revenue to the City would also increase from $600,000 to $2.9 million annually, he concluded.
Mayor Dan Gelber said, “While I appreciate their revenue, I think far more important, the lens we use is sort of what does it do for the intensity of use?”
“This parcel is going to be used for something,” Gelber said. “It’s been a container depot. It can be an office building. It could have high intensity of use and not particularly an accommodating intensity of use… this thing has been kicked down the road for a long time so we should just decide what we’re going to do with it because it may end up being something we don’t like at all. And the idea that we have some control over it now is intriguing to me. I think having 80 or 90 units where most of them aren’t going to be living here is a good thing.”
Commissioner John Alemán, Chair of the Land Use Committee said she would have preferred the issues with the Coast Guard had been worked through in advance. She acknowledged the improvements to the project since it was last discussed more than two years ago and said she would support the referral to her Committee but added, “I’m concerned that the Coast Guard’s concerns have not been addressed. Supporting the referral does not guarantee my support for the project as we move forward. That has to be earned.”
Slavens said, “Safety comes first” and that it is important “that everyone’s interests are protected and that no one feels this is invasive to anyone’s existing operations or quality of life.” She said the developer is optimistic they will have the support or at least no objection from the Coast Guard.
Alemán said she interpreted a support letter from SOFNA as “positioning the City to lean on the Coast Guard and get them to be comfortable with the project and I don’t see that as the City’s role.”
“As the property owner, we understand that,” Slavens responded.
Alemán echoed an earlier concern raised by Commissioner Michael Góngora about the traffic impact. Pérez, a bit exasperated said, “It’s hard for me” to understand “how 450 office workers on a daily basis would have less impact than 30 to 90 residential unit owners.”
Góngora said going from the allowable 40 feet to 400 feet is “why I get nervous.” He agreed there would be less impact from a luxury, boutique residential building but said, “I’m not really sure you can build a successful office building there, so that’s a great argument and a great way to have the community and Commission feel more supportive of this but I’m not sure you’re really going to build a successful office building on Terminal Island so I would like for you to... look at can you bring the height down from what it is.”
Jorge Cano, City Fleet Management Department Director, described the parcel the Fleet Management facility sits on now as a “crazy polygon.”
“It’s a crazy parcel of land,” he said. “There’s no way that we could build [a new facility] on our own” and remain in continuous operation without the adjacent land being contributed by Related Group. He said the facility which was built in 1945 is outdated, has structural issues, and is not ADA compliant.
Commissioner Ricky Arriola said, “I really like this project. What’s there not to like? It’s beautiful. It replaces what has been an industrial area. We get a brand new world-class facility for our City that we can’t afford to build that actually needs to be built.”
“As far as the height,” he said, “it doesn’t bother me because it’s a standalone building. It’s not going to be bothering adjacent buildings, blocking views… I think it makes our skyline look very nice.”
Commissioners voted 6-0 in favor of referring the discussion to the Land Use Committee with Commissioner Micky Steinberg absent. Gelber reminded everyone the action “just means we want to move it along and see what happens.”
In an interview after the vote, Rory Greenberg, a minority equity partner in the development, and Slavens discussed how they worked with the community to come up with a proposal they could support. By making the building “taller and skinnier” and “flipping it” so that the narrow side now faces toward the South of Fifth neighborhood, Greenberg said “it has the least amount of impact.”
Slavens said the developer also agreed to a list of restrictions including “no restaurants, no nightclub. Nothing that would bring people there.”
Despite Góngora’s skepticism about the potential office use on the island, Slavens said, “It’s a great place for offices,” noting the area would be perfectly suited for the hedge funds and family offices that are migrating to Florida to escape higher tax states providing a “live, work, play” environment.
In the meantime, the developer continues to receive inquiries about the property, including a recent one from a new cruise line. “That’s a real traffic generator,” Slavens said.
Greenberg noted, “There are endless disruptive uses that we could make money from” but they have chosen the less intense residential project.
The lower intensity is one of the main reasons SOFNA supports the project. Board President Ron Starkman told Commissioners, “We recommended approving the Terminal Island project, primarily because we saw less traffic if we had a residential tower than if there was an office building there, a low-rise office building which is their alternative. It would include a lot more traffic and second, if they did it that way the City would not receive the public benefit of the maintenance facility which we know is so desperately needed by the City.”
Terminal Island Development Back Taller and Skinnier:
Related Group proposes building new city fleet facility for right to build