County may seek loan from US to help Midtown Miami developers
By Shannon Pettypiece
Midtown Miami developers want Miami-Dade County to help them tap $20.6 million in government funds to add infrastructure to the 56-acre site, previously used as a railroad storage yard.
Biscayne Development Partners plan to ask the county next month to apply for a federal loan for US Housing and Urban Development assistance. If successful, the developers would repay the county over 20 years.
Their project should qualify for the loan, developers said, because Midtown Miami is planned for an underdeveloped area bounded by 36th Street on the north, Second Avenue on the east, North Miami Avenue on the west and Northeast 29th Avenue on the south. They said the project will create about 1,520 low- to moderate-income jobs.
The development is to consist of 1 million square feet of commercial space, 3,000 condominiums, 1,050 apartments and 100,000 square feet of office space. It is to be built on the old Buena Vista Railyard, a few blocks from the Design District.
If the county gets a loan, it would hand over the money to developers once financing for their first phase, about $300 million, is in place. Biscayne Development Partners is a joint venture of Jack Cayre, Michael Samuels and Dan Pfeffer and designed by architect Bernard Zyscovich.
The Miami-Dade Board of County Commissioners approved creation of a community development district for the project last week, making it eligible for tax revenue generated by the project.
"It sounds to me like a wonderful project," Commissioner Katy Sorenson said at the county board meeting.
A community development district is a taxing mechanism for building necessities such as roads and water systems and, if used properly, can save money. One benefit is that developers can get lower rates on bonds than from traditional funding sources, said real estate attorney Richard Schanerman of Akerman Senterfitt.
Mr. Samuels said he hopes the federal loan and real estate tax revenue will pay for roads and parking construction, soil cleanup and water and sewer improvements.
Other local and federal funding sources for Midtown Miami are expected to account for about $5.7 million, with the developers putting up $521 million in private funds, according to the project proposal.
"The site currently has absolutely no infrastructure - no streets, water, sewer, storm drains, power, telephone or cable. ... This area of 18 city blocks must start from scratch. The costs to do that are $25.3 million," according to the loan application written by the county.
Construction on Phase 1 is scheduled to begin in the second quarter of next year and be completed in summer 2006.
Mr. Samuels said about 30% of the land will be given back to residents and tenants in the form of public-use facilities.
Actual construction costs, according to the county's loan application, are expected to be $641 million. Developers purchased the property for $34.5 million in December 2003 from Florida East Coast Railway and expect Midtown Miami to be valued at $833 million when fully built.