The city of North Miami’s plan allowing developers Jimmy Tate and Sergio Rok to build a mixed-use project on two city-owned parking lots has hit a legal snag.
The owner of a warehouse next door to the proposed development and its tenant are suing North Miami and TR NM Holdings, an entity controlled by Tate and Rok, in Miami-Dade Circuit Court to stop the future abandonment of an alley that divides the properties.
The city intends on turning over a portion of the alley to TR NM Holdings so it can be included as part of the footprint for the mixed-use project.
TR NM Holdings would develop two buildings with 350 units, including 35 for workforce housing, as well as a 550-space garage with ground-floor commercial space of up to 20,000 square feet.
The North Miami City Council gave final approval in late May for a no-bid 99-year-lease with TR NM Holdings that requires the developer to pay the city $100,000 in annual base rent the first year with 2 percent increases every year after. The parking lots are located at 1810 Northeast 146th Street.
Tate and Rok join other builders that plan on redeveloping properties into mixed-use projects in North Miami.
According to the lawsuit, landlord 1820 146th LLC and shoe manufacturer Zigi Usa, both of which are owned by Segev Davidson, allege the city’s possible abandonment of the alley would block access to the warehouse’s three bays, two rear entry doors and the main parking area behind the property at 1820 Northeast 146th Street. The complaint states 1820 146th purchased the warehouse site in April for $3.2 million and that Zigi USA has plans to relocate into the warehouse from another space on the same block and expand its operations.
Attorney David Haber, who is representing TR NM Holdings, said the lawsuit is baseless.
“They are premising their lawsuit on a potential proposal for vacating an alley,” Haber said. “No one has moved to vacate the alley as of this date and we don’t know if anyone will ever move to vacate it.”
Haber said that if the city does move forward with abandoning the alley, 1820 146th and Zigi USA will be able to object to the matter at future public hearings. He called the lawsuit “premature.”
According to the lease language, the city may abandon the alley. But in a memo to city council members attached to the May 25 agenda, North Miami City Attorney Jeff Cazeau wrote that the developer is required to pay for the closing of the alley and the adjacent swale “upon successful conclusion of the abandonment process.”
Cazaeu declined to comment. In a June 1 motion to dismiss the lawsuit, North Miami makes the same assertions as Haber, arguing that the complaint is moot because the city has not taken any formal decision on abandoning the alley.
Anthony Narula, the lawyer for the plaintiffs, said the manner in which the city plans to abandon the alley is illegal and that the original developer of the warehouse turned over the alley so that it could be used for ingress and egress. In the lawsuit, 1820 146th and Zigi USA claim that the city is not the legal owner of the alley and cannot vacate it for the benefit of a private development.
“Just because the city doesn’t plan on moving forward with the abandonment of the alley in the near future doesn’t make it moot,” Narula said. “The developer met with my client and told him they intend to seize the alleyway. They put us on notice so we are seeking a ruling. They want to get the case dismissed so they can move forward with vacating the alley.”