In Show Of Confidence Watson Island Project Opens Gallery

Written by Risa Polansky on May 22, 2008

By Risa Polansky
In anticipation of its luxury Watson Island development, Flagstone Property Group has opened a Miami Beach gallery to show off its plans.

The move comes amid grumblings from skeptical Miami commissioners who last month questioned whether the project will ever get off the ground.

Island Gardens is to include a mega-yacht harbor, luxury residences, a Shangri-La Hotel, high-end retail and dining and a waterfront promenade, among other amenities.

Another hotel is planned for the site, though the flag has yet to be named.

A contract with Starwood Hotels for a Westin expired in January. The developer opted not to renew and is negotiating with another hotel, a publicist said..

Voters approved the project in 2001.

The Miami City Commission awarded the Miami Beach developer a 75-year lease the same year and a major use special permit in 2004.

Mehmet Bayraktar, chairman and chief executive officer, projects to begin preparing the site this fall for a 2012 completion.

The preview gallery, 1674 Meridian Ave., was to open this week.

It is to remain open daily from 10 a.m. to 7 p.m. Monday through Friday, 11 a.m. to 6 p.m. on weekends.

"The Preview Gallery offers a sneak peek of the Island Gardens lifestyle," Mr. Bayraktar said in an e-mail.

Some Miami commissioners are questioning whether anyone will have a chance to actually live it and have demanded proof before agreeing to pump more money into legal dealings for the project.

"I want to see a letter of undertaking from a bank," Commissioner Marc Sarnoff said last month.

Mr. Bayraktar maintains the project is on track, though he plans to ask the commission for more time as his August start deadline looms.

"We finalized our institutional equity with ING Clarion and closed in November 2007," he said in an e-mail last month. "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.

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."

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

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