2011-1004 Special City Commission Meeting

Home Browse Search

Summary Minutes: Special City Commission Meeting October 4, 20 II Sunny Isles Beach, Florida City of Sunny Isles Beach and its residents. He said when he last appeared before the Commission he asked that the Commission defer consideration ofthe sale of this property to allow the Commission to compare and review the proposals. He feels that the City acted in haste in approving the Ocean Corporate Center submission and proposal, and he hopes that the Commission will take the opportunity to defer their approval of the proposal to consider what again he feels is a much better proposal both short and long term for the City. Warren Stamm said that the Dezer Companies and Dezer Development are prepared to pay the City $7 Million in cash at closing, to occur within 30 days of site plan approval for this property. They are prepared to post in escrow with the City within 48 hours of execution of this Letter ofIntent, the sum of $1 Million. Upon site plan approval the $1 Million becomes non-refundable and the City will be paid an additional $6 Million at closing thereafter. Their proposal tracks similar to that proposal and plan that was proposed by the Weintraub Companies, one of the major difference is we don't have the baggage. From a financial and practical standpoint their proposal is much more favorable to the City than having the City be subjected to a long term ground lease with payments that mayor may not be made over a 25- year period with the added risk that if and when construction financing, whether it is self funded or not, is obtained the City may have to subordinate its interest behind a significant construction loan. The fact of the matter is as you have heard and you have discussed, the way this works is basically taking from the Peter pocket and paying the Paul pocket, they are self financing this through a perpetuation of sales of the condominium units. Dezer Development is prepared to purchase, close, and develop in cash with no financial risks to the City. He noted that Commissioner Aelion pointed out his concerns to wit, this is a marriage that you are getting in bed with, a company that you are going to be here with a long term with no certainties, with a ground lease, and what they are proposing is a sale, clean and simple. Thirty (30) days after site plan approval you get your money, we get the property, we build, we finance, you have the ability to take that $7 Million and do with it as you will, no risk, all reward. Gil Dezer, President of Dezer Development, said about four years ago when they wanted to start and get going and there was really at that time no place to go, there was no construction financing, there was no way of doing it, and so they could not move forward. At the same time they had all the plans and everything else that they did develop and so that will allow them to come in for site plan approval quicker than most because they have a real set of plans and renderings, and everything else of how they want to go through with this thing. One of the things that the Commission needs to think about, and he was listening to Commissioner Aelion and he thinks he is 100% right, is that regardless of how anybody will be financing this, the City will be in the subordinate position. Even if they ultimately sell these units to condo owners who might then go ahead and get a mortgage, if you want to go ahead and default because the association didn't pay their fees which is happening on every single condominium here on the ocean, especially during the down crisis, imagine the mess that is going to occur between the City trying to default on their lease, and then go ahead and have to deal with mortgage holders, bankers, and everybody else who have a piece of the pie. He knows for a fact that you always have to subordinate the land to somebody who is putting in the money for construction, even if it is a private investor or yourself. 5