Higher density ahead: North Beach land deal gets green light

Development agreement will give Ocean Terrace project more density in exchange for $15M park

Sandor Scher, Alex Blavaknik and the project plans
Sandor Scher, Alex Blavaknik and the project plans

Miami Beach gave the green light to a land deal that will allow developers Alex Blavatnik and Sandor Scher to build 110 hotel rooms on Ocean Terrace in exchange for a $15 million park near the oceanfront.

The plan was unanimously approved by the Miami Beach City Commission on Wednesday evening.

But it’s not a done deal yet. The commission will give a final vote on the Ocean Terrace development agreement on July 31st. In the meantime, details on the agreement, which will include deeding 45,925 square feet of right-of-way to the developers, will be hammered out.

Scher said the agreement is essential for the success of his project, which aims to benefit Miami Beach’s somewhat downtrodden area of North Beach, north of 63rd Street. “It enables us to get one step closer to building a world class oceanfront promenade for the community, and that’s something that will be a legacy for us forever,” Scher said.

Scher said the public will continue to have access to the deeded land, which will be merged into a future urban park that would be built at the developer’s expense on the 350-foot long asphalt hidden street of Ocean Terrace that is east of Collins Avenue and west of the sand-dunned beach.

“The idea is that all the public area that is asphalt and concrete now will be a beautiful public promenade with places to rollerblade, places to bicycle, places to walk, places to sit, and be a focal point for the entire North Beach community,” Scher said.

Blavatnik and Scher own a 2.2-acre city block in North Beach between Collins Avenue, 73rd and 75th streets, and Ocean Terrace. It’s there, after partially demolishing 12 historically designated buildings, that Blavatnik and Scher plan to build a 58-unit luxury residential building, a 110-room hotel, a 200-car parking garage, and 18,000 square feet of retail.

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But Scher said the city’s floor area ratio (FAR) zoning for the property would only allow the hotel portion to have 78 small rooms, which won’t be enough to attract a major hotel company.

He tried asking the voters for an increase in FAR from 2.0 to 3.0, as required by the city’s charter. However, 55 percent of Miami Beach voters cast ballots against a FAR increase in 2015.

But by deeding portions of 73rd Street, Ocean Terrace, and 75th Street to the developers, the city increases the size of their territory to nearly 3.3 acres, allowing for a larger development project even with a 2.0 FAR. In exchange, Scher vowed to pay $15 million for a new park that would connect the North Beach Bandshell with Alton Del Mar Park.

More than a dozen North Beach residents, business leaders, and real estate brokers spoke in favor of the development deal, arguing that the redevelopment of Ocean Terrace was desperately needed to revitalize North Beach.

Silvia Coltrane, co-founder of Real Estate Transactions Inc., helped Scher assemble property west of Ocean Terrace. Coltrane also owns property in the North Beach Town Center District, a proposed mixed-use hub at 72nd Street and Collins Avenue that voters did approve for a FAR increase in November 2017.

Coltrane told the commission that bankers and retailers won’t invest in Town Center, or other commercial areas north of 63rd Street in Miami Beach, if Ocean Terrace is left in limbo. “As goes Ocean Terrace, so goes Town Center,” she said.

Coltrane’s colleague, Willy Quintana, director of Real Estate Transaction’s commercial division, told the commission that approving the Ocean Terrace development agreement is the only way to reverse North Beach’s downward spiral. “We had six to eight businesses close in the last four to six months. Eight to 10 stated they’ll close at the end of the year,” Quintana said. “Vacancies have grown to… over 38,000 square feet. That’s how many empty spaces there are right now.” Plus, Quintana added, retail rental rates are dropping in North Beach.

There were several North Beach residents who spoke against the deal, too. Kirk Paskal, a Tatum Waterway property owner and North Beach activist, said he supported Scher’s Ocean Terrace project, but felt that this was a “dangerous way forward” because it circumvented the city’s FAR charter amendment. “This project has evolved quite a lot,” Paskal said. “If you went to a voter referendum today, it would probably pass.”