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Written by Mark Sell, BT Contributor   
December 2017

Old Catholic Charities building in Miami Shores needs a plan for tenants

FShores_1or about three decades, downtown Miami Shores has been poised at the cusp of…something. Or so goes the wishful narrative.

Time after time, things start, and then take -- well, maybe a generation. Witness sewers, which are now completed, if not hooked up, after a 30-year effort. Downtown is moving ahead, with 95 percent occupancy on its properties along NE 2nd Avenue from 93rd to 101st streets. Yet there are perils, such as a November 2018 Florida constitutional amendment referendum that could put a big hit on municipal treasuries.

For evidence of the elusiveness of both, consider the former Catholic Charities Building at 9900 NE 2nd Ave., bought by the city from the Miami Archdiocese for $1.1 million in March 2016.

The idea was to turn the property into a public-private partnership, or a P3, with an expanded police department and municipal headquarters, perhaps with a fine restaurant or offices or lofts above, paying rent to the village. More than 20 months later, the building languishes.

Mayor Mac Glinn, a big champion of downtown, solicited letters of intent from restaurants. “We have set the table,” he said in early October. “Now we need them to come. I’m excited about this project.”

Shores_2Not so fast. He got no responses for his letter of inquiry, and on November 7, the village council wrestled with the subject for about seven minutes. The pivotal comment came from Councilman Steven Zelkowitz, who handles complicated real estate matters and governmental law as managing shareholder of GrayRobinson’s Miami law office.

“It was purchased to create an assemblage with a police station and village hall,” Zelkowitz said at last month’s council meeting. “That’s still out there. The other option is just to sell it. I don’t think the village should be in the property-leasing-landlord business.”

The consensus was to take the matter back to staff, ensure proper commercial zoning on the property to prepare it to go back on the tax rolls, and move on, especially if they send out a request for proposal for a P3 and no one bites. So the issue will return -- soon.

The 1956 building offers history and even charm. It started as the Biscayne Cafeteria, “the cafeteria with a personality,” according to postcards of era. For 26 years, it stood as a two-story midcentury-modern totem, with a neon sign in glorious 1950’s cursive in front of rounded walls with wide green and white stripes, and a marbled, curved street entrance. Today that past is hidden behind coats of dreary institutional beige.

The restaurant closed in 1982, as downtown’s tide receded with the shuttering of general stores, a haberdashery, neighborhood pharmacies, and the cinema palace that sputtered along as a $1 movie theater before closing.

In the 1980s, civic worthies started grappling with a vision: to create downtown anew as an evening magnet for dining, shopping, and entertainment. In 1989 the Village tried to hit commercial property owners with a special assessment to hook into the county’s sewer system and unhook from their septic tanks. The owners would have none of it, and the effort failed.

Generations of Miami Shores village councils, Greater Miami Shores Chamber of Commerce boards, and attendees of various charettes have since brainstormed to make this vision come true as old owners have sold and passed on -- but to fitful avail.

Shores_3Today the 9900 Building still has its kitchen, and its premises play host to “Bridge with Chef Alan” weekdays at noon, admission $14, with hot dogs, bratwurst, and pizza. Bridge quartets play in a giant main room unimpeded by columns, with ceilings highlighted by two giant air diffusers that could belong on a 1952 Pontiac Chieftain dashboard. And that’s about it for engagements.

So what’s next?

The council sided with Zelkowitz to send out requests for qualifications and proposals for a P3 project for the property that would ensure commercial zoning in harmony with the comprehensive master plan.

In the meantime, brainstorms for the building are out there.

Veteran commercial real estate investor-developer-consultant Michael Maxwell, who has been active in village affairs for 30 years, offered Glinn a detailed plan to break the inertia back in September. It figured on three downstairs restaurants, perhaps an outdoor beer garden, and office or loft space upstairs, cost breakdowns, and potential estimated tax and revenue streams.

Glinn, for his part, calls Maxwell’s proposal “thoughtful.”

Brian Carter, managing commercial broker for Douglas Elliman Florida, agrees with the council that the village can’t go this alone.

“The village council is moving in the right direction and seems serious about downtown development,” says Carter, who lives in the Shores. “It would help the village to get a commercial brokerage company to find someone qualified to sign a master lease, manage the property themselves, and the give them a year to make needed capital improvements and find people who can sublease the property. It’s a prime corner. Plenty of people would jump in.”

Zelkowitz and the council had little immediate appetite to take it to a broker. Whatever the case, whoever winds up with the building will need to put in plenty of TLC.

“The issue is very simple,” Maxwell says. “Establish a rental rate and a floor plan. Negotiate. Invest maybe $800,000 to make it leasable. Demo the inside, turn it into a full kitchen, replace the AC, fix the asbestos if needed. It’s about risk reduction for the tenant. This is Real Estate 101.”

That means a smooth, predictable process, with clear standards and rapid permitting -- never considered a strong suit of the village. Maxwell suggests that any owner might pursue historic designation with a 25 percent tax credit, or as a regular investment if it doesn’t qualify.

Whatever happens with the 9900 Building, the tide in downtown Miami Shores shows strong signs of coming back, pushed by several carrots and one big stick.

Carrots: The downtown area finally has sewers, and commercial property owners will soon hook up, although none has yet. Last year the village council eased rules so restaurants can now serve cocktails.

The council is weighing rules to limit new first-floor uses in the area to restaurant and retail to appeal to foot traffic. Some property owners object, so negotiations continue.

“This is a much more favorable environment for eating and drinking establishments than it was two years ago,” Glinn says. “The properties here are 95 percent leased. This is a singular place as a small, self-contained, main street downtown area. What is unique is the amount of parking we have.”

The Catholic Charities site comes to 31,000 square feet, including the 8500-square-foot building. That includes 70 parking spaces. To add texture to the downtown mosaic, LimeBike rolled out its bike-sharing pilot program October 12 at no cost to the village, providing its signature lime-green bikes at a dollar for 30 minutes.

The stick: A constitutional amendment referendum in November 2018 is nearly sure to pass, raising the Homestead Exemption for Florida homeowners from $50,000 to $75,000, and thereby not only lightening their wallets by nearly $700 million (maybe a couple of hundred dollars per homeowner) but also removing that amount or more from budgets of municipal governments. So cities and counties must scramble elsewhere for money.

“This amendment may have nearly the same impact as the Great Recession on municipal, county, and other government revenues,” Maxwell says. “Couple that with state-mandated tax caps and property valuation, and you have a tsunami visible from shore right now. Cities like Miami Shores need to get creative.”

Miami Shores is not alone with relatively high rates in the area. Its millage rate for 2018 comes to $7.94 for every $1000 assessed valuation. The City of Miami’s is $8.00, North Miami’s is $7.50, El Portal’s is $8.30, and Biscayne Park’s is $9.70. The state limit is $10.00.

Unlike other Miami-Dade neighborhoods close to downtown, such as Brickell, Omni, Wynwood, Edgewater, and Midtown, Miami Shores never aspired to become a 24/7 live-work-play city that never sleeps. On the contrary, Miami Shores, like its sister villages of El Portal and Biscayne Park, prefers its rest.

The village’s relative somnolence may be working in its favor amid signs of commercial interest and vibrant residential real estate values. The October 21 Green Day street festival, organized by the Greater Miami Shores Chamber, drew a record number of vendors and a near-record 7000 visitors, despite intermittent rains.

Whether or not a historical designation happens, a savvy developer-operator could draw on the architectural vibe.

Yet the restaurant business is dicey, and a small village curating a restaurant for a ten-year lease is out of its league.

Glinn cites studies and a charette conducted by Redevelopment Management Associates (RMA) of Pompano Beach, all exploring a vision for both the building and downtown. RMA’s work can be found in the lower right corner of the Miami Shores Village website.

“I haven’t given up hope,” Glinn says. “I still think there’s an opportunity for some use other than a full-blown P3 or selling the property.”

Maxwell says that no matter what, the village will need to act sooner rather than later.

“There can’t be any trial balloons. Citizens of the Village paid $1 million on this and got no return,” Maxwell says. “There has been no marketing, no planning, and the Village isn’t getting where it needs to go. These are good, smart people who mean well, but the Village needs to professionalize what it’s doing.”

In any case, the Village is moving forward -- with all deliberate speed.

 

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