Developer Selected For Miami International Airport Parcels Will Have To Pay 50 Million For Roadwork
Written by Lou Ortiz on April 3, 2008
By Lou Ortiz
Any investor who takes up Miami-Dade County’s offer to develop land in and near Miami International Airport will have to pluck down $50 million.
The investor would take charge of four parcels in lease agreements with Miami-Dade and invest $700 million to $1 billion for combined retail and hotel projects on the sites, said Miguel Southwell, the county Aviation Department assistant director of business retention and development.
"We think that’s what the estimate would be," he said of the amount of investment for projects on the four parcels.
The county would use the initial money required of a potential developer to match $50 million from the state to widen Central Boulevard, a project that is estimated to cost $100 million.
Mr. Southwell said a developer could view paying the money as a "prepayment of rent" on the properties.
Developers say the projects are viable but the county must be flexible in its plans.
The county should allow developers to propose what they want to build, said Gonzalo Cortabarria, project manager for Hines Real Estate Co.
"It’s a very large project," he said. "It’s very interesting. It could draw interest if it’s toned down."
The biggest of the four sites is 25 acres near the American Airlines maintenance area at the airport, which county officials say could be used for a hotel, exhibition hall and conference facilities, or for a shopping center.
The department also wants the developer to provide a rail stop at the site for the planned Metrorail extension to the Miami Intermodal Center. The 2.4-mile Metrorail connection to the airport would come via a link from the Earlington Heights station.
"The ideas that we have heard from the private sector have run the gamut," Mr. Southwell said of proposals for the four sites.
He added that the department is open to project suggestions on the 25-acre site. "On this one [site] we’re flexible to the developer," he said.
On the other sites, the county is pitching what it wants built.
The second site is next to the Dolphin garage at the airport, where the department wants a 300- to 600-room hotel constructed.
"We’ll be asking for a minimum of a three-star" facility, said Mr. Southwell.
The third site is near the airport exit — close to the intersection of LeJeune Road and Central Boulevard — where the department wants a shopping plaza with a gasoline station, convenience store and dry cleaner.
"It would primarily serve the over 35,000 employees who work at the airport, as well as the customers," Mr. Southwell said of the more than 90,000 passengers who use the airport on a daily basis.
More than 33.7 million passengers used the airport in 2007.
The fourth site, in Terminal E, includes the existing hotel inside the airport, which is next to offices used by the aviation department.
Mr. Southwell said the hopes in Terminal E are for a developer to remodel and expand the hotel into the department offices.
On March 25, about 50 commercial real estate investors, architects, bankers and investment firms flocked to a workshop for the public-private investment partnership project held by the department.
The goal was to get ideas and suggestions from investors and developers on the sites for the mixed-use plan, so that when the county draws the request for proposals it will be attractive to potential investors.
Mr. Southwell said the county would be flexible on rental payments and "allow the market to determine that lease."
"We’re leaving the flexibility," he said, "for the investor to get a fair return."
"I believe it’s viable, but making it viable is the issue," said Carlos Flores, president of CMF International Group in Miami.
"There’s an investment that has to made, and there has to be flexibility," he said.
The county should be flexible on the revenue that would go to the airport from the developments and when those monies would start flowing back, Mr. Flores said.
"This is a big project," he said, adding that the department’s workshop was aimed "at how we [the industry] can make this happen."
Mr. Southwell said that because of the complexity of the four projects, the county wants to protect its interests and those of the airlines and maximize the potential returns.
"I think June is when we’re looking to go to the Airport & Tourism Committee" with the request for proposal on the four projects and lease agreements, he said.
The full county commission is expected to vote on the matter in July.