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Front Page » Top Stories » City Of Miami Losing Patience On Watson Island Hotel Marina

City Of Miami Losing Patience On Watson Island Hotel Marina

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Written by on May 1, 2008

By Risa Polansky
Miami officials fear a long-planned luxury development on Watson Island may fall through, with the developer asking for a time extension as legal costs for the project rise.

Mehmet Bayraktar, chairman and CEO of Flagstone Property Group, insists the Island Gardens mega-yacht marina, hotel and retail project is on the way.

He projects to begin preparing the site this fall for a 2012 completion and attributed delays to lengthy government processes and a more-than-yearlong lawsuit.

Commissioners last week deferred approval on $495,000 in attorney’s fees for service related to the lease and development of the city-owned property, demanding proof the project is going to happen.

Voters approved the project in 2001. Commissioners awarded the Miami Beach developer a 75-year lease the same year and a major use special permit in 2004.

Before moving forward now, Commissioner Marc Sarnoff said, "I want to see a letter of undertaking from a bank."

City Manager Pete Hernandez informed commissioners the developer, facing an August deadline to begin, is asking the city for more time.

"They’ve had problems in completing their financial package," he said.

Mr. Bayraktar maintains the project is on track.

"We finalized our institutional equity with ING Clarion and closed in November 2007," he said in an e-mail. "Moreover, we have been in the process of finalizing our construction loan documentation."

ING Clarion Partners agreed last year to invest along with Flagstone about $600 million in the project.

Upon announcing the partnership in December, Flagstone projected a 2010 completion after years of targeting 2008.

"Since we won the RFP and the subsequent citizen approval to construct this project, Flagstone has been working diligently to meet all of the city’s requirements, obtain all the required permits and approvals and conduct the required environmental preparation for the site with the goal of taking possession of the property and (beginning) construction," Mr. Bayraktar said.

It took more than two years to gain approvals from the Army Corps of Engineers and South Florida Water Management District, he said. 

A lawsuit by the property’s former tenants took more than a year and a half to settle.

"We are near to completing all of the prerequisites imposed per our development agreement and ground lease for taking possession of the land, and we will be ready to put the proverbial shovel in the ground," Mr. Bayraktar said. 

Commissioner Angel Gonzalez echoed Mr. Sarnoff’s cry for proof.

"I would also like to see a commit from a bank or something," he said.

Mr. Bayraktar said that, as part of his request for more time, "we will be providing responses to the city or to the commission, including financing information."

Both commissioners said a foreign company could do the job immediately.

"European companies, they have all the money right now," Mr. Gonzalez said.

Mr. Bayraktar maintains the city will get what it wants.

It has cost $33 million to get the project to this point, Mr. Bayraktar said. Advertisement

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