The Miami Herald
October 4, 2010
Watson Island Plan: On Track, But Slimmed-Down?
By Charles Rabin, email@example.com
A slimmed-down version of a long-awaited Watson Island development appears to be in the works -- though when construction starts remains up in the air.
It was a bizarre scene even by Miami standards: A well-heeled lobbyist standing in front of Miami commissioners holding a $200,000 cashier's check. The mayor wanting it -- yet worrying it was being used as a lure to string the city along.
The city manager checking to make sure it was real. And finally, the city attorney accepting it, and most commissioners quickly voting to save one of the city's most ballyhooed -- but delayed -- projects, at least for now.
“It didn't bounce at all,” City Manager Carlos Migoya said of the check.
Last month's 4-1 vote, with Commissioner Frank Carollo the lone dissenter, means the remake of the long-neglected southern end of Watson Island by the Flagstone Island Gardens group is still alive.
But more than nine years after voters gave developer Mehmet Bayraktar the go-ahead to build a Shangri-La-type village on one of the city's remaining waterfront jewels, a question remains: Can the public expect anything more than a slimmed-down version?
“I'm tired,” said Commissioner Wifredo “Willy” Gort, recalling the vote he took part in back in 2001. “I have a lot of doubts on this right now.”
Watson Island, a spit of land connecting Miami Beach to the mainland, has long been described as one of the city's remaining waterfront jewels. Yet for decades its southern end has sat mostly barren and dusty.
Almost a decade ago commissioners ceremoniously gathered in a shack on the island, let the public vote for development, then crowed of what was to come: Five-star hotels and restaurants, with the world's wealthiest mooring their yachts at a sparkling facility as fishermen sold their daily catch at markets flowing with customers.
In November 2001, voters overwhelmingly supported the plan, granting Bayraktar a 45-year lease. By 2004, he had secured the permits necessary to build.
His initial venture included hotels of 14 and 25 floors, surrounded by 137,000 square feet of retail space, ponds, gardens, walkways and dining facilities on balconies overlooking a 54-slip mega yacht facility off the island's west end.
The Chalks Airline terminal was to remain, until a 2005 crash off Miami Beach ended the company's operations.
Hotel developer Sherwood “Woody” Weiser, who built The Grand Hotel in Coconut Grove, was to put up 40 percent of the money for the project, and remains a member of the Island Gardens advisory board. The developers said they'd have the permits in place within a year, and that Miami would receive almost $250 million in payments over the 45-year lease.
Yet since the voter approval Miami has collected only $1.1 million -- and not a single piece of promised construction has broken ground.
“We went out and campaigned for it,” said Miami Mayor Tomás Regalado, who voted with Gort to allow the public referendum. “The fisherman who were there who were kicked out actually campaigned for the referendum.”
Since 2001, rent has been paid sporadically. Commissioners signed off on extensions for the agreement. Threats from the city about taking back the property came and went.
Bayraktar spent three years fighting lawsuits filed by residents of nearby Venetia who argued the plans would affect their quality of life. Since then, as the world's economy teetered, he has been unable to find financing.
Other issues surfaced: It turned out Shangri-La Hotel & Resorts, China's largest luxury hotel operator and the company that was to build on Watson Island, had connections to Cuba. In a city filled with thousands of exiles from the communist nation, the news rubbed some raw.
“It's like perfect storms hitting the project,” said Regalado. “This is the Murphy's Law poster child.”
Bayraktar's attorney Kevin Cowan of Shutts & Bowen, said, “We ran into 9/11, then a real estate financing collapse.”
When Regalado was elected mayor in November, he made Watson Island a priority. He met with Bayraktar and his advisors and came up with an agreement in March in which Bayraktar would pay the city $200,000 and the plan would live yet again.
Bayraktar, however, refused to make the payments until commissioners voted for a new agreement. Last month's theatrics and the $200,000 check set Bayraktar back in good graces with the city -- for now.
Now, Bayraktar has three years to start construction of the marina, and six years to begin any retail and parking. Rent payments begin at $300,000 the first year, and cap at $2 million in 2018.
City planners must go before the state to secure waivers on some parts of the plan, and the item must return to Miami for a final vote, probably late this year or early next.
Bayraktar has four months to clear up more than $3 million in liens accumulated over the years. If any of the conditions are not met, the city has the right to take back the land.
Under the new agreement, there are no specific plans for hotels or restaurants or retail outlets. The only development set in stone: a mega-yacht facility. The idea is to lure some of the wealthiest people in the world to Miami, and away from facilities in Fort Lauderdale and the Bahamas.
Mega-yacht marinas typically attract millions of dollars in potential revenue for the surrounding community. The boats have large staffs and need fuel. They need to be cleaned and serviced. Families and guests have to eat, shop, and typically stay on land when the boat is docked.
Plans call for a pair of 470-foot elevated, tree-lined platforms. Vessels must be between 100 and 465 feet. Only 23 boats less than 100 feet long will be permitted at a time at the 54-slip marina. A pair of water taxis and four charter boats would dock. Cowan, Bayraktar's attorney, said the fact that elements of the project can be built in phases should give city leaders faith his client will come through.
“Once the marina is visible, it will bring a great deal of spotlight to the project,” said Cowan, adding Flagstone has several sources looking at financing the plan, though, “nothing is inked.”
Still, Commissioner Carollo wants the land back. He made that clear during last month's meeting, when he said Flagstone has had more than enough opportunity to deliver.
“This sounds like a bad marriage,” he said. “And we just need to move along.”
Brian May, a lobbyist hired by Bayraktar to negotiate the new terms with the city, said between dealing with lawsuits and the faltering economy, his client was caught in a tidal wave of bad timing.
“This idea that we've been stringing the city along is really not accurate,” said May. And, he added: “There will not be any more negotiations.”