Pebb Capital Sues Miami Beach Over Live Local Act Development

A developer is suing the city of Miami Beach, alleging city officials are illegally blocking a joint venture’s plan to redevelop an Art Deco hotel into a Live Local Act mixed-use project with 249 apartments and 38 hotel rooms.

In a complaint filed last month in Miami-Dade County Circuit Court, the entity that owns the vacant Bancroft Hotel at 1501 Collins Avenue, and Ocean Steps, an adjacent retail complex, accused the city of Miami Beach of violating the state’s Live Local Act, which allows developers to circumvent local zoning laws to build high-density projects with workforce housing units, set aside for tenants earning up to 120 percent of the area median income.

The law also allows developers to bypass public approvals and go through an administrative entitlement process.

The developer entity is managed by Todd Rosenberg, who leads Boca Raton-based Pebb Capital.

The firm partnered with Coconut Grove-based Maxwelle Real Estate Group, led by Richard Weisfisch, and Russell Galbut, a principal of Crescent Heights and GFO Investments, two Miami-based firms developing several projects in Miami Beach.

Rosenberg’s entity purchased the Bancroft Hotel and Ocean Steps from a Galbut-affiliated entity for $47 million in 2021, records show.

A Miami Beach spokesperson did not respond to requests for comment.

“Like many municipalities, the city of Miami Beach doesn’t like to be preempted,” said Thomas Robertson, an attorney representing Rosenberg’s entity. “They are doing everything they can to stall it, stop it and prevent it.”

The city has approved only one out of 12 Live Local project applications since the law was enacted in 2023, Galbut said. In contrast, the city of Miami, Miami Beach’s neighbor, has approved 61 Live Local projects, Galbut said.

“Everything in the city of Miami Beach languishes somewhat,” Galbut said. “I think Live Local allows us to deal with the serious issue of affordability. Miami Beach has lost residents because we have no housing and no affordability.”

Rosenberg’s entity is seeking a court order forcing the city to approve its plan and bar Miami Beach officials from imposing development rules aimed at Live Local projects.

The joint venture plans to redevelop the locally designated historic site on 1.2 acres into a mixed‑use tower with 40 percent of the 249 apartments set aside for workforce housing as required by the Live Local Act. Previously, Pebb and its partners contemplated renovating the Bancroft and Ocean Steps into a luxury office project.

The city’s planning staff allegedly refused to accept the joint venture’s Live Local application, arguing that the Bancroft and Ocean Steps parcels function as a unified development site, requiring the developer to obtain consent from adjacent condo owners at 1500 Collins Avenue, the lawsuit states. The development entity asserts that it is not required to seek approval from the neighboring condo owners.

Live Local requires cities to administratively approve qualifying multifamily or mixed‑use projects on commercial, industrial or mixed‑use land, and it preempts local limits on height, density, floor-to-area ratio and reviews by public zoning boards.

The developer-friendly law has riled up some municipalities and a number of residents across South Florida, with some critics citing concerns over the effects of these larger projects on infrastructure. In Surfside, residents and the town’s mayor are opposing a proposed 11-story, 33-unit residential and hotel project submitted under Live Local. Mayor Charles Burkett called the project a “disaster.”

“I think the Florida politicians that decided to destroy the fabric and composition of small towns by this developer-driven initiative is outrageous,” Burkett said earlier this month.