As dev site prices soar in Miami, buyers play a “dangerous game”

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Development site deal volume in Greater Downtown Miami rose 155% between 2019 and 2021

Broker Miguel Pinto with developers Toby Moskovits, Jenny Bernell and Harvey Hernandez, who all have projects planned in Greater Downtown Miami (APEX Capital Realty, Moskovits via Sasha Maslov, iStock)

Developer Chaim Cahane bought a development site in Miami’s Wynwood for $6.4 million in December. Three weeks later, a broker called him with an unsolicited all-cash offer: Flip it for 75 percent more.

Then, in March, Cahane’s Forte Capital partnered with investor Jon Krasner to buy a separate Wynwood site from East End Capital for $10.8 million. After closing on that site, they turned down an offer to flip it for a 30 percent gain.

“Every day I’m getting calls to sell,” Cahane said “It’s ridiculous.”

The cost of land and the pace and volume of deals are soaring in South Florida.

The market is so hot that major multifamily sales have become a dime a dozen, and single-family homes are referred to as collectors’ items. At the same time, developers are rolling out dozens of new projects, and selling or leasing them up quickly. Wealthy out-of-staters have “discovered Miami,” pumping up prices of commercial and residential real estate. To those buyers, the city is still a bargain, brokers say.

Miami’s urban core, including Edgewater, Wynwood, the Arts & Entertainment District, downtown and Brickell, has recorded over $1 billion in land sales over the past two years, according to Real Capital Analytics data provided by Colliers International South Florida. In Edgewater, eight development sites traded for more than $185 million last year. That marks a 529 percent increase in sales volume compared with 2020, and a 141 percent increase compared with 2019.

While industry experts are quick to point out that oversupply isn’t yet a concern, record pricing coupled with rising interest rates and inflation could send the market into a tailspin, they say.

“This bubble is about prices getting too high,” said Craig Studnicky, CEO of Aventura-based brokerage ISG World. “What’s happening with prices is obnoxious. How do young people move here? They can’t afford to anymore.”

Sticker shock

In 2019, prior to the pandemic, 24 development sites in Greater Downtown Miami sold for more than $315 million, or about $16 million per acre, according to the Colliers data. Last year, 34 properties traded for over $808 million in the same area, for a price per acre of about $19 million. On a dollar volume basis, that’s an increase of 155 percent in three years.

“A lot of people believed [prices] would hit a wall and not continue to escalate, but all we see are continual new highs for sales of properties,” said attorney Keith Poliakoff, of Government Law Group.

“If we can’t get [costs] under control, if the rents don’t catch up, and people’s incomes don’t catch up… We may be entitling projects three years from now, which happened before when the economy collapsed in 2009,” Poliakoff said. “A lot of those projects we approved just sat in building departments and didn’t move until the economy picked up again.”

When the pandemic first hit South Florida, there was an immediate slowdown in commercial real estate — until demand quickly returned last year.

Take the sale of the Midas store at 2140 Northeast Second Avenue in Miami’s Edgewater neighborhood. Prior to Covid, the listing broker, Miguel Pinto, said he “had a really, really hard time” trying to sell it.

“I couldn’t give it away,” said Pinto, who is broker and owner of Apex Capital Realty. Then, in February, Brooklyn-based Heritage Equity Partners paid $6.3 million for the property, home to a store that was built in 2019. Heritage, led by Toby Moskovits and Michael Lichtenstein, plans to tear it down and build an apartment tower on the site. Land costs typically account for 10 to 15 percent of a project’s budget.

Today, Pinto said it could “very easily flip” for over $400 per square foot. It traded for $283 per square foot.

“There’s been a crazy appetite from developers wanting to enter the market,” who are betting on rents and demand for housing continuing to rise, he said.

Some local developers are selling land on which they planned to build because the offers are just too good to pass up.

On Fisher Island, an exclusive residential enclave that is accessible only by boat or helicopter, developer Heinrich Von Hanau is in contract to sell the last condo development site on the island. The buyer is a partnership led by the Related Group and billionaire Teddy Sagi, paying what is expected to be a record price, according to sources.

The thinking: Prices are still on the rise, and if a developer passes on a purchase, it could eventually sell for 20 percent, 25 percent or 30 percent higher, said Colliers broker Mitash Kripalani.

“Yes the price is high, but there is so much demand,” Kripalani added. “Most of the buyers paying top dollar are a lot of new-to-market developers. “If you’re a local buyer who was buying in Miami five to 10 years ago, you’re experiencing sticker shock.”

Developer Harvey Hernandez locked in a purchase price for the Brickell site of his Lofty project prior to the pandemic, and closed on his $50.5 million acquisition in October. He said he could sell it for more than double that in today’s market.

“People have come to us and tried to buy it from us, but we’re not in the business of selling [land],” he said. Lofty is nearly 90 percent reserved after launching sales in late 2021.

“Developers coming into this market are paying for speed and paying for premium pieces.

They are looking at the market differently,” Hernandez said. “If you’re coming from New York, Chicago, Los Angeles you might see [Miami, where] you can sell for $1,200 a foot as a huge bargain.”

Brokers are using that in their sales pitches.

“All day long, we’re knocking on doors, we’re cold-calling people,” Kripalani said. “We’re chasing our sellers who we know haven’t transacted in a while.”

A dangerous game

The party line for developers is that they are monitoring construction costs (up 30 percent to 35 percent, but that depends on who you ask) and supply chain issues. They say they are locking in pricing on appliances and materials wherever possible, and so far those increases have been offset by gains in rents and home prices.

“The supply chain is still making it incredibly difficult to buy appliances and goods. The price of steel and wood varies dramatically,” attorney Poliakoff said. “What I get worried about is construction prices haven’t seemed to hit the top.”

Interest rate spikes are beginning to slow deals down. Buyers who were bidding on 10 properties are now bidding on two, said lender and broker Aaron Kurlansky, principal of Sheridan Capital and FM Capital. Rent growth projections are also being adjusted. Even on the residential front, some sellers of single-family homes are reducing their prices.

“With the rates rising, it’s really where on a deal previously you had 20 buyers, now you have five or six. It takes a lot of people out very, very quickly,” Kurlansky said. “We’ve definitely seen a little more prudency in the market.”

But developers are optimists who will push the market to its limits before pulling back.

In some cases, buyers are closing on land without taking the time to understand a site’s zoning. And because costs have surged, developers looking to increase the density of their projects have flooded law firms specializing in land use, zoning and entitlement work, Poliakoff and other attorneys say.

“There’s a maximum amount a unit can rent for or sell for,” Poliakoff said. “To be able to pay the higher prices, [developers] have to seek government approval to increase the density of these properties to spread out that purchase price. Long gone are the days where you could pay $25,000 to $35,000 per door for a new development site.”

He cited an example of a property owner who obtained entitlements for a 55-unit apartment project on a site two years ago in order to increase the property’s appeal. A prospective buyer recently told the owner that if the density could not be increased to 85 units, the numbers wouldn’t work and the deal wouldn’t happen, Poliakoff recounted.

New Yorkers and other out-of-state developers are lured by few regulations and the lack of state income tax in Florida, but once they arrive, some are in over their heads, unfamiliar with the building materials that should be used and how local governments work, attorneys say.

Government Law Group’s developer clients are all seeking more density on $2.5 billion worth of projects, Poliakoff said, pointing out three developments backed by New York-based real estate investment trusts that are developing for the first time in South Florida.

“All three are paying more than I have expected someone to pay, but in all instances they feel that the market will continue to go up, and as such they see that the rent today is not going to be the rent when they finish construction two years from now,” Poliakoff said. “I always say that while developers can profit handsomely, it also has enormous risk.”

Major multifamily landlords, who have arrived in South Florida in droves, are now moving into ground-up development because the investment sales market is overheated.

“All of them today have told us the deals they would normally buy are so overpriced, they are unable to make their numbers work,” Poliakoff said.

Pinto of Apex said that buyers have to pay less for land unless construction costs fall.

Institutional buyers have inundated the market, attracted to huge gains in rent growth. Miami led the country in rent hikes during the pandemic, with the median monthly apartment rent rising 58 percent since March 2020 to nearly $3,000, according to a recent report from Realtor.com.

Multifamily rents in Edgewater are at about $3.50 per square foot, according to Pinto. And buyers are underwriting deals with rents at $5 a square foot, two to three years from now.

“Will it get to that point? Maybe. I think people are playing a dangerous game,” he said, referring to rising rates, construction costs and inflation. “There’s a huge demand, and then a culmination of things from a macro perspective that can make the whole sentiment go south.”

Link: As dev site prices soar in Miami, buyers play a “dangerous game”

Protecting Trade Secrets and Avoiding Litigation in the Great Resignation Era

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Arguably one of the biggest changes has been the unprecedented manner in which millions of Americans have quit their jobs in search of new career opportunities that offer greater flexibility, improved work-life balance, higher pay and increased opportunity for advancement.

The times they are a-changin’—and it’s beginning to look like things may never go back to the same way they were pre-pandemic. Indeed, COVID-19 has materially affected just about every aspect of our lives. Arguably one of the biggest changes has been the unprecedented manner in which millions of Americans have quit their jobs in search of new career opportunities that offer greater flexibility, improved work-life balance, higher pay and increased opportunity for advancement. In some cases, these individuals are resigning from their jobs by way of email from home, without even the courtesy of providing the traditional two-weeks’ notice.

This phenomenon, coined the “Great Resignation,” continues to endure even after the precipitous decline in infection and mortality rates, with nearly 4.3 million people quitting their jobs in January alone, according to the March 9 U.S. Department of Labor, Job Openings and Labor Turnover Report. Many of these departing employees were privy to trade secrets that are now at risk of being disclosed to competitors, and the traditional protections may not cover the novel employment arrangements in this new normal.

These recent developments pose a myriad of legal issues that will no doubt give way to a wave of litigation as former employees may be sharing trade secrets with their new employers, violating non-compete agreements, or taking with them corporate intelligence that belongs to their ex-employer. Here are some basic tips to help protect corporate interests from departing employees and mitigate liability related to the hiring of new employees.

  • Take inventory of what assets are worthy of protecting and determine what measures are necessary to keep them secure.

In order to devise an effective strategy for navigating the challenges created by the Great Resignation, it is essential to first conduct an audit of what trade secrets warrant protection, and then perform a comprehensive risk analysis to identify any and all threats to these assets. This should include:

  • an evaluation of what proprietary and trade secret information the company maintains and relies upon that provides it with a competitive advantage;
  • who in the organization has/had access to this information and through what means;
  • what measures are in place to prevent unauthorized access to, and/or wrongful disclosure of, this information by current and former employees; and
  • what security gaps or weaknesses exist that must be corrected.

The results of this exercise, which should be performed by a group of high-level stakeholders from every department of the organization, can serve as a helpful guide in preparing a roadmap to achieve the company’s human resource and information management objectives.

  • Restrictive covenant agreements are a good start, but may not be enough.

Historically speaking, some of the strongest tools that companies have had at their disposal in managing employee turnover and safeguarding its trade secrets are their use of restrictive covenants such as noncompete and nondisclosure agreements. Noncompetes, however, which are required to be reasonably limited in time, geographic location, and line of business, may no longer sufficiently cover work-from-home employees who now have the ability to work for companies all over the world—from anywhere in the world.

Employers should review any active non-compete agreements entered into pre-pandemic with their legal counsel and assess whether any amendments need to be made. For example, consider a greater emphasis on restrictions against working for explicitly named competitors, as opposed to a blanket restriction by industry in a limited specific geographical area.

If used properly these can be extremely helpful as both a prophylactic measure and as a tool of enforcement. For this reason, companies would be wise to audit their records and ensure that all employees who have access to trade secrets have signed non-disclosure and non-compete agreements on file. It may also be helpful to remind departing employees of their legal obligations and even send a courtesy copy of their agreement(s) to their new employers to put them on notice.

On the other side of the coin, to avoid stepping on this proverbial landmine HR departments should add a question to their standard employment application asking whether the candidate is bound by any restrictive covenants. If the answer is yes, then further investigation is required before hiring. If they answer no, and it turns out they actually were bound by an agreement, it at least gives the company a viable defense against willful infringement.

Until the law catches up with the new reality of how people work, companies will have to lean on their IT team to implement additional security measures to mitigate the risks that HR policies and procedures cannot.

  • It is high time for IT to have a seat at the table.

Technology has been one of the greatest blessings during the pandemic, allowing for people to continue making a living from home, thereby keeping businesses running and preventing an economic collapse. Fortunately, it has also given employers new tools for safeguarding their trade secrets.

The implementation of VPN software, utilizing virtual data rooms, and requiring employees to log in through a secure portal to access the network, all have certainly been helpful. So too have restrictions against using USB thumb drives and limitations on printing. But it’s the mandatory computer and mobile device monitoring programs that track everything the employee does, and notifies the organization when certain documents or folders are accessed, that have provided the strongest protections.

As we come out of the pandemic and inflation continues to rise, corporations will need to be vigilant if employees continue resigning at this record pace. While I can’t predict the future, I do expect to see an increase in litigation.

Jordan Isrow is a partner at Government Law Group in Fort Lauderdale, Florida. He focuses his practice on complex litigation, corporate counseling and representation of governmental entities.

Link: Protecting Trade Secrets and Avoiding Litigation in the Great Resignation Era

3 Real Estate Areas To Watch As Russia-Ukraine War Persists

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Law360 (April 1, 2022, 10:58 AM EDT) — As Russia’s invasion of Ukraine enters its second month, U.S. real estate investors are all eyes on supply chain and inflation concerns, while global investors could shift more of their assets into U.S. properties amid growing concerns about the European market.

The U.S. real estate market was already facing supply chain and inflation pressures before Russia’s invasion of Ukraine in late February, but experts say the war has exacerbated those problems and has thrown an additional wrench into the equation, with energy prices now facing additional pressure.

U.S. real estate developers are eying supply chain and inflation concerns, and overseas investors could shift more of their assets into U.S. properties, as Russia’s invasion of Ukraine enters its second month. (AP Photo/Nam Y. Huh)

And while U.S. projects are facing severe delays, the U.S. could see additional capital from overseas investors who are skittish about the Europe market.

Here, Law360 looks at three areas of U.S. real estate to watch.

Supply Chain Issues Have Worsened

Chief among the concerns of developers is the difficulty in getting materials, both basic and specialty, to finish projects on time, and that’s leading to a host of delays and cost increases.

“The supply chain issues still remain at woeful levels, and the war in Ukraine has only made things worse,” said Keith Poliakoff of Government Law Group. “My clients still cannot get the materials necessary for construction, which is holding up the amount of new projects, especially residential units, coming to the markets. Developers are experiencing tremendous cost hikes and supply chain issues and fuel cost increases.”

The supply chain issue is just one of a complex set of global concerns that have worsened since the start of the conflict, such as inflation and fear of a recession.

“The war clearly has exacerbated some of the concerns,” said Seth Weissman, a partner at Jeffer Mangels Butler & Mitchell LLP. “If we head into a recession, overall growth goes down and arguably the availability of people to invest in real estate goes down. But at the same time, you’ve got the issue of inflation. … So it could be the worst of both worlds.”

“If we don’t see an oil shock, that could help to stem some of the concerns,” Weissman added.

And while parties are adjusting their timelines to work with the current supply chain bottlenecks, it might not be enough.

“Supply chain issues are likely to get even worse,” said Robert Ivanhoe, vice chair of Greenberg Traurig LLP. “It’s certainly adding a lot of risk and cost.”

Underwriting Has Changed

While developers are adjusting their timelines when it comes to supply chain concerns, parties are now also changing their underwriting to take into account lower expectations for growth, as well as higher prices.

“When clients underwrite real estate transactions, they have an expectation of return. Those expectations are significantly impaired when the cost of capital goes up. I’m seeing it already,” Weissman said. “I’m seeing people who are looking at deals who wished they had locked in rates 30 days ago. There’s transactional pressure on the professionals to get deals done.”

While companies are redoing their underwriting when it comes to would-be deals, there’s also increased pressure on the rental market. Amid rising prices, owners are forced to either take a financial hit, pass the additional costs onto tenants or some mix of the two.

“It will affect energy prices. … It will affect rents,” Andrew Raines, a founding partner of Raines Feldman LLP, said of the war in Ukraine.

And when it comes to construction, companies are also having to start with a clean slate. In some cases, projects that haven’t gotten off the ground now no longer make financial sense, experts say.

“All of [the developers] have been diligently recalculating the entire cost of the project,” Poliakoff said. “Some of them will not break ground.”

Global Investors Are Eyeing U.S. Real Estate

The U.S. real estate market has long been viewed as a safe haven for foreign investors amid global political and economic upheaval, and the war in Ukraine could make U.S. assets even more attractive to foreign investors.

“Many global investors have always put a significant portion of their investment into Europe. … The perception now seems to be that Europe is much more of a risk to inflation pressures and energy pressures, and that that’s really going to ripple through to real estate,” Ivanhoe said.

There are concerns about the future of the European real estate market, and inflation remains problematic. On the latter point, global investors could look to put more of their capital in U.S. real estate, given that the sector has historically been viewed as a safe haven when it comes to inflationary environments, Ivanhoe said.

“We would hope that as Europe is in a state of flux, that more funds will funnel into the U.S.,” Poliakoff said.

And with the expectation that the European real estate market may get worse, look for more investors to make deals in the U.S.

“People are expecting Europe to become more severe. There’s been more of a focus here as being a safer market. The dollar has strengthened relative to the euro,” Ivanhoe said. “I’ve been getting a number of inquiries from foreign investors who really haven’t invested here before. A lot of them have invested very heavily in Europe. They’re very concerned about Europe right now.”

–Editing by Nicole Bleier and Alyssa Miller.

Link: 3 Real Estate Areas To Watch As Russia-Ukraine War Persists
Auther: Andrew McIntyre

As a luxury sports bar seeks later hours in Delray Beach, it gets caught in noise battle with neighbors

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DELRAY BEACH — The issue of whether more late-night bars in Delray Beach could expand farther out on Atlantic Avenue will likely soon come before the city again as a new sports bar keeps up its fight to receive an exemption to stay open until 2 a.m.

And that will likely set up another contentious battle between business owners who want the freedom to operate later and residents who bought homes outside the city’s entertainment district concerned about late-night noise infiltrating their neighborhoods.

Bounce Sporting Club, an upscale sports bar set for the $300 million Atlantic Crossing development on Atlantic just east of Federal Highway, is planning to open in the fall as one of the cornerstones of the new development. The bar, however, sits outside the city’s entertainment district, which runs from Swinton to Federal Highway and allows businesses to stay open until 2 a.m.

That means Bounce would have to close every night at 12 a.m. unless it’s granted an exemption from the city. Bounce says closing at midnight would significantly hinder its business since so many late-night sporting events such as UFC, boxing and West Coast sports last well past that cut-off point.

Bounce narrowly received preliminary approval from the Planning and Zoning Board, but was forced to temporarily pull its application from a Feb. 1 City Commission meeting after significant backlash from local residents about late-night noise issues made it unlikely the proposal would be granted.

Attorney Neil Schiller, who represents Bounce, said they pulled their proposal so they could “educate” more nearby residents about the bar.

The building that will house the Bounce Sporting Club on East Atlantic Avenue in Delray Beach on Friday December 10, 2021. The $300 million Atlantic Crossing project has generated pushback. Some city officials and residents have expressed concerns the sports bar is out of character for the area and that noise from the late night establishment would be a nuisance to residents (Carline Jean / South Florida Sun Sentinel)

“I know there’s a great concern from the community there’s going to be lines out the door and that all these people are going to be drunk, unruly and noisy and that it’s going to be 1 a.m. and they’re still trying to get in,” Schiller said. “That’s not the case.

“We don’t want our guests to be lined up out the door on Atlantic Avenue. We’re trying to start an upscale sports bar, restaurant and lounge. Upscale places don’t let their guests, especially in Florida, wait in 90-degree heat to come in.”

Schiller said Bounce is willing to make concessions in order for later operating hours, including closing their doors, windows and patio at 11 p.m. and limiting people to one entrance and exit closest to Atlantic and 7th.

Bounce Sporting Club bills itself as combining “elements of a sports bar with the high-end cocktail lounge nightlife experience.” A representative for Bounce, which has additional locations in New York and Chicago, told city officials it would also feature live performances at the Delray Beach location.

Bounce has residential communities both to the north and south, extending east to the Intracoastal. In addition, the Atlantic Crossing complex also will feature 261 luxury apartments by the sports bar.

Some nearby residents, however, fear that allowing Bounce an exemption could create a domino effect where other bars outside the entertainment district would be granted later hours. Rita Rana, who sits on the board of Barr Terrace Condominiums across the Intracoastal from Bounce, said residents aren’t opposed to Bounce, but the potential of them operating past midnight and creating a situation where late-night revelry and noise could potentially cause issues.

“If this were to be approved, it would bust the boundaries of that entertainment district,” Rana said. “And it would change the entire dynamic of an area that has been slated not to have any of that entertainment past midnight.”

While Bounce officials are trying to assuage the fears of nearby residents, Rana said “prior to opening, there is absolutely nothing they could say and nothing they could do” to convince her they should be allowed to stay open until 2 a.m, adding that residents are still “fired up” about the matter.

Schiller believes some of the concerns are being overblown, arguing that some bars outside the entertainment district, such as Hurricane Bar & Lounge and Blue Anchor Pub, are allowed to stay open until 2 a.m. since they were grandfathered in before the boundaries were set.

Bounce is aiming to go before the city commission at some point in the spring, Schiller said. When asked whether Bounce would still open if it was denied the exemption, Schiller said it wasn’t something he could answer, but noted that investors were under the expectation the bar would be allowed to stay open until 2 a.m.

If there’s still heavy pushback, he said there could be the potential for compromise “if they want us to open until 1 a.m. for a period of time and then give us a chance to prove ourselves to get to 2, that’s something we may be in favor of.”

Link: As a luxury sports bar seeks later hours in Delray Beach, it gets caught in noise battle with neighbors
Auther: Wells Dusenbury

Rise Of Florida Mini-Cities Blurring Urban-Suburban Lines

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Among outgrowths of the pandemic has been an explosion of newcomers to Florida. Many recent arrivals to the state are from urban areas in the Northeast and Midwest U.S., where density and walkability have long been part and parcel of daily life.

It’s only appropriate, then, that Florida is witnessing a surge in what might be termed “mini-cities.” These compact urban districts offer a dense, lively, pedestrian-friendly lifestyle fueled by proximity of homes, offices, eateries, shops and nightlife. They’re not that different from areas of New York City, Washington, D.C., Boston and Chicago where many folks get around to everything they need, all without vehicles.

The result is a blurring of the traditional demarcation between city and suburbia in some areas of Florida, where new development has replaced once-blighted landscapes.

Sense of place

Building mixed-use developments in Florida is not a new idea, says Gerard Yetming, executive managing director with Colliers. But the last half decade has ushered in a fresh concept: Creation of large-scale mixed-use areas intended to forge a sense of place in settings once devoid of housing and businesses. “It is clear people want to work and play where they live, which is why we will continue to see developers bringing urban designs to the suburbs, and suburban designs to urban cores,” he says.

Mixed-use developments from Fort Lauderdale-based master developer BTI Partners in Tampa’s Westshore Marina District and Hollywood, Fla.’s Hollywood Young Circle are two fitting examples of the phenomenon. Company CEO Noah Breakstone says the goal is to reimagine the way people live and invent fresh concepts that interweave healthy living, culture, technology, entertainment and work-life balance.

“To be able to achieve this goal, we blend the suburban-urban concepts in creating a new, redefined, walkable, mixed-use lifestyle,” Breakstone says.

Another instance of urban-suburban blurring has taken shape in Miam’s Wynwood enclave. Addition of an office component was the final piece of the puzzle necessary to make Wynwood a mini city, says Shelby Rosenberg, R&B Realty Group head of development and acquisitions, asset and property manager, U.S. portfolio. As it has for some time, the district has continued to serve up key redevelopment opportunities to transform long-abandoned industrial structures into Class A office buildings, chic eateries, upscale condominiums and attention-getting apartment communities.

New York City-based R&B Realty Group’s just-completed office tower Gateway at Wynwood helped trigger other developers to build market-rate apartments, luxury condos and stores. “In the next couple of years, as new projects are completed, people will be able to live, work and play in this area, which is becoming a city within a city,” Rosenberg says.

Replacing neglect

Coralee Penabad, principal at Coral Gables, Fla.-based Urban-X Group, reports that in constructing a mini-city west of downtown Miami, her company sought to become a driver of transformation in an area that for decades had seen only disinvestment.

“We were able to attract big-box retailers, which are often found in the suburbs, to the urban core because retailers recognize people are increasingly choosing to shop where they work and live,” she says. “This generation doesn’t want to drive to the suburbs to do their shopping. They are all about enjoying the benefits of the urban and suburban lifestyle in one submarket, without having to leave their neighborhood.”

One more observer taking note of the mini-cities trend is land-use attorney Keith Poliakoff, founding partner of Fort Lauderdale-headquartered Government Law Group. Poliakoff says well-conceived developments are melding multiple uses to create urban environments in the suburbs, and vice versa.

He credits the leadership and long-term vision of elected officials intent on enhancing the quality of their constituents’ lives. Concludes Poliakoff: “A lot of community planning goes into these large-scale developments so that they can create live-work-play environments where residents never need leave the comforts of their mini-cities.”

Link: Rise Of Florida Mini-Cities Blurring Urban-Suburban Lines
Auther: Jeffrey Steele

A new sports bar in Delray Beach wants to stay open until 2 a.m. Here is why it’s raising major concerns among residents.

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DELRAY BEACH — Delray Beach has long confined the festiveness from its late-night bars and restaurants to a half-mile stretch on Atlantic Avenue, but that could come to an end.

Bounce Sporting Club, an upscale sports bar set for the $300 million Atlantic Crossing development on Atlantic just east of Federal Highway, is hoping to become a new destination site on the Ave. The bar, however, sits outside the city’s entertainment district, which runs from Swinton to Federal Highway and allows businesses to stay open until 2 a.m.

They want an exception to the rule so they can show late-night sporting events such as UFC, boxing and West Coast sports. But city officials and residents have voiced concerns the late-night noise could become a nuisance to the people who live nearby and add “further degradation” to the area.

The surrounding neighborhoods near the Intracoastal Waterway “are precious in the city and they’re under a lot of assault from noise pollution, light pollution, overdevelopment,” Delray Beach Planning and Zoning Board member Joy Howell said during a public meeting.

“I think we should avoid further degradation of the district.”

Officials, who are considering the proposal, fear it could set precedent and create a “domino effect” where restaurants and bars outside the entertainment district could push to remain open until 2 a.m.

Bounce Sporting Club bills itself as combining “elements of a sports bar with the high-end cocktail lounge nightlife experience.” A representative for Bounce, which has additional locations in New York and Chicago, told city officials it would also feature live performances at the Delray Beach location.

Bounce has residential communities both to the north and south, extending east to the Intracoastal. In addition, the Atlantic Crossing complex also will feature 261 luxury apartments by the sports bar.

Claudia Willis, a 25-year Delray Beach resident who lives in the neighborhood 300 feet south of the sports bar, spoke against the late-night hours during a public meeting, saying the applicants don’t fully grasp how much bothersome the noise could be.

She talked of how easily noise travels across the downtown, saying she can “hear every word when there’s an outdoor performance at Old School Square,” which is a half-mile west. “Unless you live downtown, you don’t know.”

“The applicant chooses to ignore us to the south, but also ignores their own [apartments],” Willis said.

The city “needs to decide what kind of town Delray will be and guide that in every decision. It is subtle decisions that are changing our demographics. Many have already left in search of what Delray used to be.”

Atlantic Crossing, a massive 9-acre project by Veterans Park and the Intracoastal Waterway, is the city’s attempt to invigorate the stretch of Atlantic east of Federal, which has remained largely dormant.

The site will also feature restaurants, shops and 83,000 square feet of office space. Construction is projected to be finished by the end of the year, a spokeswoman for the development said.

Bounce Sporting Club, a 5,000-square-foot venue, is one of the cornerstones of the project, operating on the first floor off Atlantic Avenue. Michael Dutko, a representative for Bounce, told the Delray Beach Planning and Zoning Board that Bounce would be an “incredibly valuable addition” to Atlantic, citing the lack of high-end sports bars. He also said noise wouldn’t be an issue, pointing to design measures created to limit noise.

Chris Davey, Chairman of the Planning and Zoning Board, was unconvinced, however. “This isn’t the city that doesn’t sleep and it’s not the Windy City,” he said, referencing Bounce’s other locations in New York and Chicago.

Davey, along with board member Rob Long, also worried that allowing a 2 a.m. exception could set a precedent where other bars and restaurants do the same, creating a possibility for late-night establishments to creep closer and closer to residential areas.

Keith Poliakoff, a Fort Lauderdale attorney who specializes in land use and zoning issues, said a one-time exception wouldn’t create a “strong legal grounds” if a future applicant was denied on a similar proposal.

“Every applicant stands on its own merits,” Poliakoff said. “If they approve this one and deny another one, there’s no strong legal grounds for them to sue a municipality based on that decision. For the same reasons a municipality could oppose two schools going next to each other or two houses of worship.”

Poliakoff said the board is likely referring to precedent in terms of “‘will that create an idea with the community that we’re turning this into an entertainment district as well?’”

Dutko appeared surprised by the pushback from board, saying he didn’t “anticipate it being controversial.” He argued that some bars outside the entertainment district, such as Hurricane Bar & Lounge and Blue Anchor Pub, are allowed to stay open until 2 a.m., but Davey noted those bars were grandfathered in before the boundaries were set.

Bounce representatives plan on revising the proposal to address the noise complaints in an attempt to salvage the late-night hours. The Planning & Zoning Board will issue a final ruling on the proposal during an upcoming meeting.

Link: A new sports bar in Delray Beach wants to stay open until 2 a.m. Here is why it’s raising major concerns among residents.
Auther: WELLS DUSENBURY

South Florida Business Journal Runs Jordan Announcements

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South Florida elected leader worked remotely during COVID. His peers determined whether he could keep his commission seat

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MIRAMAR — Miramar City Commissioner Winston F. Barnes, 73, will keep his seat on the dais.

City leaders planned to vote at Monday night’s meeting on whether to oust Barnes for attending commission meetings remotely throughout the pandemic. But before any commissioners could discuss or vote, Commissioner Maxwell Chambers, who brought up the motion, withdrew it.

Barnes had filed a motion to fire City Attorney Burnadette Norris-Weeks and the firm she represents, Austin Pamies Norris Weeks Powell, PLLC. She, too, will get to keep her job, commissioners decided.

After the hours-long heated discussion and public comment surrounding Barnes’ and the city attorney’s potential terminations, commissioners largely agreed that they wouldn’t support losing either person.

Mayor Wayne Messam said Monday’s meeting was “one of the darkest” he had seen in his 10 years on the job. Messam said he was surprised to see the topic on Monday’s agenda because no commissioner supported taking action on Barnes’ potential firing at the last meeting.

He couldn’t support removing Barnes, Messam said, pointing out that the agenda item made it seem as if he “has been absent, void, silent, AWOL for one year” when Barnes was still attending the meetings and voting on items. He told commissioners he was not in favor of removing the city attorney, either.

“There obviously is not support for the removal of our attorney, but I must say that I don’t know how this wound can be mended, but there has to be some way that it’s addressed,” Messam said. “It has to be.”

After Barnes had attended meetings virtually from May 20, 2020, through September of this year, commissioners asked Norris-Weeks for her legal input on whether a commissioner was obligated to attend meetings in person and if he or she could be in attendance without physically being there.
Norris-Weeks issued a memo that says if the mayor or commissioner does not attend meetings for three consecutive months, he or she can be “relieved” of office by the commission’s majority vote.

Barnes, 73, who was elected in 2003, “emotionally shared his medical conditions” at an October meeting and told his colleagues that a family member of his had been hospitalized and remains in a coma, a letter from Barnes’ attorney, Keith Poliakoff, to City Attorney Burnadette Norris-Weeks says. Barnes recently returned to attending the meetings in person.
Poliakoff’s letter to Norris-Weeks notes that Barnes was marked “present” in the minutes for each meeting he logged into from May 20, 2020, through Sept. 1 of this year and that Barnes was never told he may be violating the city charter for attending and participating virtually.

Barnes said Monday that the city attorney “literally set me up” by not telling him about his needing to physically be in the chambers. “The taxpayers and the city of Miramar deserves better than it is getting with our city attorneys,” he said.

He defended himself from some who have brought up that he has been going to work in person at the radio station where he works. “I sit in a booth by myself, and on top of that we are such a small operation if at any time there are five people in the building, we are overcrowded,” he said. “When I left work today, there were two other people in the building.”

Before removing his motion to fire Barnes, Chambers said he felt staff made their best efforts to provide a safe environment at the chambers for leaders to return during the pandemic with plexiglass shields and mask requirements. He proposed that commissioners in a future situation may create a rotating schedule for commissioners to decide who can work virtually and when to avoid the same issue.

“When you’re here to do the people’s business, you have to be responsible, that’s why we are here … We all came back, staff came back, and there’s no excuse,” Chambers said.

Commissioner Alexandra Davis said accusations that the discussion to fire Barnes was political retribution was “quite maddening.”

“It’s very clear what the charter states — that we needed to have shown up for work,” Davis said. “All of that being said, we agree to move on from this as a lesson learned and that hopefully in the future [if] any one of us have an issue coming to work, we’ll let our colleagues know …””

Barnes’ motion to fire the city attorney argued that the commission had “lost faith in the Norris-Weeks ability” to provide legal counsel in the best interest of Miramar citizens. No one supported Barnes’ motion.

Vice Mayor Yvette Colbourne said she could not support removing the city attorney “based on what one commissioner feels has been one wrong incident.”

“That’s now how you judge someone’s performance. I think when we have an issue it needs to be worked on, it needs to be resolved,” Colbourne said. “We need to be reasonable, and we need to approach these things both as adults and as professionals.”

Michelle Austin Pamies, a partner at Austin Pamies Norris Weeks Powell, PLLC, said the opinion provided to city leaders about Barnes’ attendance and participation was the best, most accurate opinion the city attorney could provide.

“When a commissioner comes to you and asks for a legal opinion on any matter, you provide the opinion you think is accurate. We are not advising the city commission to take action. We’re asked to provide an opinion,” Austin Pamies said.

Link: South Florida elected leader worked remotely during COVID. His peers determined whether he could keep his commission seat
Auther: ANGIE DIMICHELE

This elected leader worked remotely during COVID. Now he may get fired.

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MIRAMAR — A 73-year-old elected official who worried about contracting COVID-19 faces losing his job — because he only showed up virtually for business during the pandemic.

Miramar city leaders are expected to vote Monday whether to fire Commissioner Winston F. Barnes, concluding that leaders “may punish its own members for misconduct,” according to the city’s documents.

Officials said he can be fired because he broke the city’s rules by not attending commission meetings in person for three months.

There’s a battle to come: Barnes’ lawyer, Keith Poliakoff, says the city has no authority to oust him. It’s the voters who put Barnes in office, not his fellow elected officials. And only Florida’s governor has the power to remove an elected official from office, the lawyer says.

Was it misconduct?

The commission, which resumed in-person meetings last year, asked City Attorney Burnadette Norris-Weeks for her legal opinion last month. They wanted to know “whether there is an obligation of City Commissioners to attend city commission meetings in person,” and whether they could be in attendance without being physically present.

She issued a memo indicating that the charter reads that if any member “shall fail to attend meetings for a consecutive period of three months,” then that person “may be relieved of his/her office by a majority vote of the City Commission.”

She told the South Florida Sun Sentinel it’s “illogical” to think somebody could attend remotely indefinitely and not return in person. An in-person quorum is required to even have a meeting, she said. If people thought they could work remotely forever, they would, she said. “Everybody was afraid,” she said of the pandemic. “Nobody was sitting around thinking they didn’t have to come back.”

Commissioner Alexandra Davis said she doesn’t favor firing Barnes, but still notes it’s important to attend meetings in person. “I believe he’s elected by the people but at the same time he has to do his job and show up to work,” Davis said. “The people deserve [for] him to show up.”

Attending meetings virtually

Barnes said he has participated: He started attending meetings online when COVID-19 closed City Hall. He has recently returned to appearing in person.

Poliakoff argues that Barnes attended virtually from May 20, 2020, through September of this year and that the city’s attorney “suddenly and surprisingly completely reversed course and now opined that participation is not the same as attendance.”

He wrote in a memo to Norris-Weeks that she needs to reverse her legal decision.

Poliakoff said because of Barnes’ age, 73, and existing medical issues, he’s considered high-risk and was being careful to not contract the deadly virus while still attending City Hall meetings.

Barnes said other members of the commission have had COVID or had to be quarantined, and he wanted to make sure he didn’t bring anything home to his family.

Barnes said he believes the push to fire him is political retribution: He often has conflicting votes with his colleagues, and he also supported Broward County Commissioner Barbara Sharief in South Florida’s recent 20th Congressional District race.

Many of his other colleagues, who are of Jamaican descent, supported another candidate, Jamaican-born Dale Holness. One of Holness’ supporters is City Commissioner Maxwell Chambers — Sharief’s ex.

“I vote my conscious,” Barnes said. “I can vote freely.”

When he did miss a meeting entirely, he said it was days after his wife’s sister was in a car crash that left her in coma. He said he has only missed a couple meetings in his entire tenure at City Hall.

Barnes has turned the tables: Also up for discussion Monday is his motion to fire the city’s attorney, saying she never told Barnes that anything was amiss.

“At every meeting he was marked as present, his vote was counted,” Poliakoff said. “At no time was he ever told, ‘You need to be in person or we’re not going to consider you present.’”

If the commission were to remove Barnes, he’ll file an injunction and the legal fees will start mounting, Poliakoff said. “They have no authority to throw him out of office,” he said. “They’re doing it just to see if they can get away with it, really.”

Link: This elected leader worked remotely during COVID. Now he may get fired.
Auther: LISA J. HURIASH and BRITTANY WALLMAN

South Florida expects windfall from $1.2T infrastructure bill

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The $1.2 trillion infrastructure bill Congress passed is expected to jump-start major construction projects in South Florida, bringing a significant number of jobs and opportunities for local contractors.

The Infrastructure Investment and Jobs Act, which President Joe Biden is expected to sign in the coming days, includes multiple areas of infrastructure that will be bolstered nationwide.

Miami-Dade County Mayor Daniella Levine Cava said her administration has been preparing to partner with the federal government to invest whatever money comes its way into “hundreds of shovel-ready resilience projects that also create good-paying local jobs.”

“We’re ready to put these funds to work to create new opportunities for thousands of Miami-Dade residents and businesses as we build back our economy stronger than ever,” she said in a statement.

Levine Cava’s office highlighted numerous projects it expects will be near the front of the line for federal stimulus, such as converting septic systems to sewers; allowing ships at PortMiami to hook up to shore power instead of burning fuel; building more electric vehicle chargers; and climate resilience projects such as roadway improvements, floodwater mitigation and the protection of wastewater treatment plants to guard against climate change. The county’s SMART Plan for mass transit will also be a priority. Its mass transit corridors include bus rapid transit routes from Dadeland to Florida City and the Miami Intermodal Center near Miami International Airport to Tamiami, and a commuter train on the FEC Railway from Miami through Aventura.

Lisa Colon, a construction attorney at Saul Ewing Arnstein & Lehr in Miami, said the bill will create many jobs in highways and bridge construction, as well as public transportation and climate infrastructure. Miami-Dade was under pressure from regulators to reduce pollution from its wastewater system, so this bill should provide funding to help it modernize its system, she said. The county has been considering working with private companies to fund the repairs to the Rickenbacker Causeway, which leads to Key Biscayne, but the bill may provide enough funding to start the project, Colon said.

The infrastructure bill also has a 10% target for small businesses participating in these construction projects, and includes outreach and training funds for small businesses and disadvantaged businesses, which generally includes minority- and women-owned contractors, she said.

Colon said to make sure to register with the SBA as a small disadvantaged business “because they will favor these programs toward them.”

Dan Lindblade, CEO of the Greater Fort Lauderdale Chamber of Commerce, said the influx of federal money could bring 700 to 2,000 new jobs to Broward County.

“The reason it’s important for us is bridges, roads, subterranean infrastructure,” he said. “This is a real godsend for South Florida – and for the United States, for that matter.”

Broward Mayor Steve Geller said his county has substantial needs when it comes to making itself more resilient to sea level rise and climate change.

“We are currently 2 inches from overtopping the … flood control structures,” he said. “I am truly worried that we are going to be flooded in South Florida.”

The federal money will also be a huge help for Broward’s efforts to improve its transportation system, including roads, buses, highways, rail, Port Everglades and Fort Lauderdale-Hollywood International Airport.

Gretchen Cassini, Broward’s Mobility Advancement Program administrator, said the county will be able leverage its recently passed sales tax for matching grant funds from the federal government. In March 2018, Broward voters approved an additional 1% sales tax for transportation and mobility improvements. It is expected to bring the county $16 billion over 30 years.

“The importance of the surtax is that we have become more competitive for all of these various grant programs because we have a local dedicated source of revenue,” she said.

Federal funding may also be tapped for one particularly important and huge project: creating a new way for passenger trains to travel over the New River in Fort Lauderdale. Grupo México-owned Florida East Coast Railway freight trains and Brightline passenger trains, owned by Tokyo-based SoftBank Group Corp., use the Florida East Coast Railway Bridge, a drawbridge that is only 4 feet above the water. Whenever the bridge goes down, boat traffic is interrupted, sometimes for as long as 45 minutes. That happened 34 times a day prior to the pandemic, much to the frustration of the local marine industry.

Additionally, Tri-Rail Coastal Link, a proposed commuter train service operated by the South Florida Regional Transportation Authority, won’t be able to operate north of the the New River since Grupo México, which also owns the train tracks, capped the number of trains traveling over the bridge at 36 trips a day. The commuter service, which is still not fully funded and depends on cooperation from Brightline and the FEC, is envisioned to have 81 stops between downtown Miami and Jupiter.

Proposals for a new passenger rail connector include building a bridge at least 25 feet above the water and a tunnel under the river. Those proposals, which cost from $216 million to $2.5 billion, will be discussed at a Nov. 18 meeting in Fort Lauderdale.

Neil Schiller, an attorney and lobbyist affiliated with Boca Raton-based Government Law Group, said Palm Beach County officials are likely “salivating” over the prospect of receiving hundreds of millions of dollars for infrastructure improvements. He noted that the county has already aggressively invested taxpayer money toward improving and upgrading roadways and bridge. Now, with federal money earmarked for such purposes, Schiller said local tax money might be diverted for other purposes, “things like homeless workforce housing and affordable housing.”

Donald Burgess, CEO of the Chamber of Commerce of the Palm Beaches, said he’d like to see the money used to improve drainage in coastal cities and road connections between the eastern and western parts of the county.

“We are fine with the north-south flow of traffic,” he said, “but when it comes to the east-west, that has always been a challenge.”

As for the economic impact, Burgess said it’s too early to tell.

“It is a big deal, but right now, in terms of the business community, it is very hard to say what the impact is going to be,” he said. “Yes, it has been approved, but we are not sure as yet of the details of what the state will get, what counties will get, what the cities will get.”

Link: South Florida expects windfall from $1.2T infrastructure bill
Auther: Brian Bandell and Erik Bojnansky