Voters on Tuesday defeated developers’ plans for a pair of office projects off Miami Beach’s Lincoln Road.
A development group led by Don Peebles and another team led by Integra Investments — with Barry Sternlicht among the members — wanted to build on separate sites in South Beach. The controversial bids to develop city-owned parking lots under 99-year leases had divided commissioners and residents throughout most of this year.
Miami Beach voters shot down the proposals in two referendums. Nearly 54 percent of voters rejected Peebles group’s plan and 53.3 percent opposed Integra team’s proposal. Peebles vowed to tweak his plan and bring it to voters again in the future.
Mayor Dan Gelber and Commissioner Ricky Arriola touted the projects as an opportunity for South Beach to shed its anything-goes party image and create a live-work-play environment. All commissioners except one voted in July to put the proposals on the ballot. The Class A offices would diversify the Lincoln Road area beyond dining, entertainment and retail offerings, supporters said.
But commissioner Kristen Rosen Gonzalez, the sole nay-sayer on the dais, as well as many residents decried the proposals as bad deals for the city. The developers would lease the public parking lots for below market rent, all while the projects would add to traffic bottlenecks and come at a time when there’s a looming question mark over the viability of offices, opponents said.
Peebles had partnered with former Miami Beach Mayor Philip Levine and Scott Robins to propose a six-story building with 80,000 square feet of offices, ground-floor retail and 43 apartments on 1.4 acres at 1664 Meridian Avenue. The project would have included 290 parking spaces, 151 of which would have replaced the existing ones on the site and would remain public. At a minimum rent of $145.7 million over the lease term, the developers would have paid at least $1.5 million to the city annually.
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Starwood’s Barry Sternlicht, Integra Investments’ Nelson Stabile and Comras Company’s Michael Comras with rendering of The Gardens at Lincoln Lane (Getty, Starwood, Integra, Comras JV)
Integra, a Miami-based firm led by Nelson Stabile, teamed up with Sternlicht’s Starwood Capital Group and Michael Comras’ Comras Company, both based in Miami Beach, for a planned six-story building on a 0.9-acre lot at 1680 Lenox Avenue and an eight-story building on the nearby 1.1-acre lot at 1080 Lincoln Lane North. The project, dubbed The Gardens at Lincoln Lane, would have added 130,000 square feet of offices; 25,000 square feet of ground-floor retail; and more than 425 parking spaces, 192 of which would have replaced the existing spaces on the site and remain public. To sweeten the proposal, the developers also planned 1,000 square feet of public space for a nonprofit or an educational institution, as well as a “pocket park.” With $210 million in minimum rent payment over the lease term, the city would have received at least $2.1 million annually.
Each development team would have paid a lump sum initial rent and then would have started paying the greater of 5 percent of their revenue or a minimum annual rent, with payments escalating annually.
A third ballot question asked voters if they want the city to use the rent proceeds from the projects to bankroll workforce housing, public safety measures, and resiliency and sustainability projects such as buffering the city from the impacts of sea level rise.
This measure passed with almost 58 percent of the ballots cast in favor — a moot decision in light of voters’ rejection of the site leases and projects.
But the outcome of this measure is encouraging to some developers.
Peebles and his son, Donahue Peebles III, who also is part of the development team, said they plan to take another whack at their projects. Only next time, they will “lean more heavily” into including workforce housing and climate resiliency aspects as part of their proposals, Peebles III told The Real Deal.
Peebles viewed his defeat as partly because Miami Beach voters faced a crowded ballot, he said via text message.
One of eight referendums asked voters to approve increasing the floor area ratio for a North Beach area, which would have allowed billionaire Stephen Ross’ Related Companies to build a bigger project on the site of the Deauville at 6701 Collins Avenue. Residents also rejected this measure with 53.4 percent of the vote.
“The vote percentages for the two Lincoln Lane development questions and the Deauville Hotel FAR increase were essentially the same, which indicates voters grouped them together,” Peeples said.
A representative for the Integra/Starwood/Comras team did not return a request for comment.
Political action committee Yes for a Strong Miami Beach raised $963,000 in October and November, including from the Peebles Corporation, Integra, Levine and Robins, according to Voter Focus’ database.
In an email to residents, Rosen Gonzalez celebrated the rejection of the office projects.
“Money can buy a lot of things, but it can’t buy the public’s trust,” she wrote. “And that’s the message we sent to the billionaires yesterday as we saved 3.5 acres of city center land.”