Repaint Watson Island Red Flags As Public Green Space
Written by Michael Lewis on November 5, 2009
By Michael Lewis
Even before this week’s election picture clarifies, Miami’s new leaders face an immediate test with vital long-term coloration: What to do about a long-awaited Watson Island showcase that’s clearly painted red?
A developer who variously says he has put $49 million or $54 million into a mega-yacht marina/luxury hotels project but has yet to sign a ground lease with the city, turn a shovel of dirt or get financing keeps stumbling over relatively minor monthly rent — a big red flag.
Last time around, he was tardy paying the city $100,000 for two months. This time, with costs up to $83,000 a month, he fell behind three more months and got a default notice with a Nov. 1 deadline, which he did not meet. He said he wasn’t focusing on that but on the big picture: building.
Commissioners, however, must focus on the vital issues of having a tenant who seems unconcerned about paying on time, or at all, and the larger question of how to best steward the city’s front-door waterfront.
On both issues — getting the most revenue from tenants and conserving waterfront for residents’ use — the city has a miserable track record.
A new mayor and heavily altered commission need to improve that, and quickly. This is their first chance, with a Feb. 1 deadline bearing down on them to sign a ground lease on an unparalleled site.
The default should bring immediate legal action to regain the public’s land for the public.
One thing for sure: if Mehmet Bayraktar seems unconcerned about paying before the deal is final, think how much worse off the city would be if he started construction with the same attitude and $2 million monthly payments due when operations began.
Much has changed since the city cut a deal to hand its glorious waterfront facing downtown and our docked cruise ships to Mr. Bayraktar’s Island Gardens project back in 2001.
There’s global economic turmoil, which Mr. Bayraktar blames for blocking the financing he needs.
Meanwhile, luxury hotels that were counted on as the economic engine of Island Gardens have been hampered by the same downturn, with experts predicting a years-long climb back to rates high enough to sustain new luxury lodging.
And now the city, the state and Miami-Dade County have agreed to rip up the core of Watson Island and its sole road, the MacArthur Causeway, to bore twin truck tunnels to the Port of Miami. Not only would such massive construction impede work on Island Gardens, but the tunnels will by design convert the road facing the proposed hotels into a cargo highway — hardly conducive to luring the high-rollers the project has been targeted toward.
Let’s be clear about this: though Mr. Bayraktar is not at fault for the downturn, it came years after his 2001 agreement with the city. The project could well have been completed before the plunge — and fortunately for all concerned was not.
Now, the question is whether it should be completed at all.
Larry Spring, city chief financial officer, told county officials last month that Island Gardens was all but dead in the water. Not so, Mr. Bayraktar said — he’s still going after financing. Presumably, he’s been doing that for at least eight years. How he’s managed so far to spend $49 million, as he recently told the New York Times, or $54 million, as he told us, remains unclear.
Mr. Bayraktar said to us he has told the city that "at this time we are not in a position to pay imposed "consideration for use payment’ which we are not even using the land." Those payments, to which he had previously agreed, are equivalent to rent — holding the city land for his use alone.
If he can’t pay those and now objects to them, how good a tenant is he going to be if he does get funding to build?
City Commissioner Marc Sarnoff, for one, says Mr. Bayraktar needs to pay just like any other tenant. The commissioner is asking how the project can be salvaged, maybe with a new developer, or whether the city should hold a referendum on a new project there.
The better question is: Why develop at all?
Mr. Sarnoff and the city clearly want the rent — but isn’t the land worth far more to citizens as a family-friendly bayfront park highly compatible with the Miami Children’s Museum next door than as a generator of rent from a developer?
Use the land today as park and it could be developed in the future if the city found a great use. But develop the land today and that opportunity for highest and best use is gone forever.
Outgoing Mayor Manny Diaz was the city’s green mayor who paradoxically promoted development everywhere. The old commission went along for the ride.
Now, a new mayor and radically altered commission face an ugly economic landscape that limits development. They need to be artistic enough to save our blue waterfront’s green space.