Menin Hospitality’s Byron Carlyle Theater redevelopment vote shelved until February

Rendering of Byron Carlyle Cultural Center, with Matis Cohen, Jared Galbut and Keith Menin (Miami Beach City Commission)

Rendering of Byron Carlyle Cultural Center, with Matis Cohen, Jared Galbut and Keith Menin (Miami Beach City Commission)

Miami Beach delayed until February a vote on Menin Hospitality and its partners’ plan to redevelop the Byron Carlyle Theater in North Beach.

The Miami Beach City Commission opted not to vote on a proposal by Menin Hospitality and KGTC, LLC to replace the 52-year-old, city-owned Byron Carlyle with a 125-foot-tall theater complex with 151 workforce units.

Assistant City Manager Eric Carpenter told the mayor and six commissioners Wednesday evening that the city needed more time. “We do think this proposal has some merit and we do think it has potential, [but] we do not have the financial analysis for this project yet,” Carpenter said.

The city bought the theater in 2001 for $1.7 million, and it served as a movie house for the non-profit O Cinema for five years until the city’s building department deemed it an unsafe building in July 2019. Six months prior to its closure, the city issued a request for proposals for bids to redevelop the theater into a “mixed-use project with a cultural component.”

On Aug. 3, Menin Hospitality and KGTC, LLC became the de facto winning bidders to redevelop the Byron Carlyle after Pacific Star Capital withdrew its proposal to transform the circa-1968 movie theater into a 11-story mixed-use hotel building.

Menin Hospitality is run by nightlife entrepreneurs Keith Menin and Jared Galbut, nephews of Crescent Heights co-founder Russell Galbut. KGTC LLC is owned by developer Matis Cohen and Galbut’s daughter, Marisa Galbut.

According to the latest term sheet, Menin Hospitality and KGTC are proposing to construct a new Byron Carlyle Cultural Center with a 10,500-square-foot theater, 9,000 square feet of ground-floor retail, 129 one-bedroom units, and 22 two-bedroom units at its own expense, in exchange for a 99-year lease, and a $350,000 contribution from the city for environmental remediation. And although city regulations require 200 parking spaces for a theater, the developers want all parking requirements waived.

The proposed development agreement would also require that apartments be reserved for workforce housing for just 30 years of the 99-year lease, with 80 percent of the units reserved for households making 140 percent of the county’s area median income, or about $89,600 a year.

In addition, the developers want to collect all the rent from the cultural center’s retail and apartments, and pay the city a ground rent of $1 a year.

However, Jared Galbut said the developers will pay property taxes on the property, which he estimated to be $44 million a year. Galbut emphasized that he and his partners will be taking the risk since they intend to finance the project with private equity.

“We will build the city an amazing cultural center that will easily be a hub for the community,” Galbut said.

The new Byron Carlyle will be constructed within the North Beach Town Center, a 10-block area that’s slated to be redeveloped into a densely packed region of hotels, apartments, and retail. Across the street from the theater, KGTC LLC is building a 22-story apartment complex with microunits and retail called 72nd and Park. Also within Town Center, Pacific Star Capital is proposing to build a Target-anchored shopping center.

Cohen told commissioners that parking isn’t needed at the Byron Carlyle Cultural Center because a 700-space garage will be constructed within the Town Center. Plus, Cohen said, “Town Center was created as a compact urban area that would prioritize the pedestrian instead of the car.”

Miami Beach Mayor Dan Gelber questioned the terms of the deal. Gelber was sure the city could probably outright sell the Byron Carlyle for $5 million to a private developer if it wanted to. And, after consulting with the operators of O Cinema and the Miami Light Project, Gelber felt that the theater portion needed to be larger than 10,500 square feet. “The primary goal for this, without question, was to lever North Beach as a world-class cultural institution,” Gelber said.

The city administration, meanwhile, felt that more apartment units should be affordable for people making less than $89,600 a year. In a memo to the mayor and commissioners, Miami Beach City Manager Jimmy Morales stated that the annual median area income in Miami-Dade County is $59,100. But, as of 2019, North Beach’s median household income was $43,439, and 70.8 percent of North Beach households make below $75,000 a year.

“The administration recognizes that the developer deserves credit for proposing to introduce workforce housing in North Beach, but the proposed tenant income mix reflects above-market rates for North Beach, an area where 20.1 percent of individuals are categorized by the U.S. Census Bureau as below the poverty level,” Morales wrote.

Miami Beach residents calling into the virtual meeting had mixed opinions on the project. Some supported the Menin Hospitality-led proposal, but others insisted that the city should use bond money, grants and donations to renovate the theater and operate it itself, rather than allow developers to replace it with apartments. Kristen Rosen Gonzalez, a former Miami Beach commissioner, denounced Gelber and commissioners David Richardson and Ricky Arriola as cheerleaders for the developers with “matching pom poms.”

“We can raise the money and renovate it…. Look at the Colony Theater,” Rosen Gonzalez said. “The entire deal does not pass the smell test.”

Gelber, though, feared that the Byron Carlyle could end up like the Coconut Grove Theater in Miami and the Roosevelt Theater in Mid-Beach’s 41st Street — empty and derelict for decades — if the city tries to redevelop the property itself. “I don’t want to spend five or six years on a project, have it fall apart, and end up starting all over again,” Gelber said.

Commissioner Arriola suggested that the city pass the resolution now and negotiate a better deal later, stressing that it would cost the city more than $3 million to get the current Byron Carlyle up to code. “If we don’t do this project, what is our alternative?” he asked.

But Gelber said he agreed with Carpenter and the rest of the administration that the deal still needs to be hammered out. “I am not going to support it today because it’s not fully baked,” Gelber said.

City Attorney Raul Aguila, who is slated to become Miami Beach’s interim city manager after Morales resigns on Friday, said he will try to bring a new deal to the commission by Feb. 24. The city will also retain the services of an independent appraiser to determine the true value of the Byron Carlyle.

Keith Menin snags a home on North Bay Road, Brickell Flatiron commercial space buyer seeks court-ordered discount: Daily digest

A daily roundup of South Florida real estate news, deals and more for August 29, 2019

August 29, 2019 06:30PM

Every day, The Real Deal rounds up South Florida’s biggest real estate news, from breaking news and scoops to announcements and deals. We update this page throughout the day. Please send any tips or deals to [email protected]

This page was last updated at 6:25 p.m.

Nelson Gonzalez and Keith Menin with 2318 North Bay Road

Nelson Gonzalez and Keith Menin with 2318 North Bay Road

Keith Menin snags a home on North Bay Road. Hotelier Keith Menin paid just over $12 million for a bayfront mansion in Miami Beach, roughly a year after buying another home in the Venetian Islands. Property records show Stuart Browning, founder of Embarcadero Technologies, an IT company based in San Francisco, sold the eight-bedroom, nearly 15,000-square-foot mansion at 2318 North Bay Road [TRD]

Brickell Flatiron commercial space buyer seeks discount on $22.5 million sales price. Three years after agreeing to pay $22.5 million for Brickell Flatiron’s retail and restaurant space, a partnership between Avi Dishi and Haim Yehezkel wants a Miami-Dade Court to reduce the purchase price over allegations of an undisclosed revision of the construction plans. In a recent-filed lawsuit in Miami-Dade Circuit Court, Manhattan-based Dishi and Sons, and Brickell Flatiron Retail, a firm owned by Dishi and Yehezkel, accuse CMC Group affiliate Downtown Development Holdings of making significant portions of the 24,800-square-foot ground-floor commercial space unusable by placing a garage ramp through it. [TRD]

David and Leila Centner and the Centner Academy (Credit: Getty Images, Google Maps)

David and Leila Centner and the Centner Academy (Credit: Getty Images, Google Maps)

Owners of new Miami Design District school hired the mayor’s law firm to represent them in zoning appeal. In June, real estate investors David and Leila Centner received approval to operate a preschool at the property, at 4136 North Miami Avenue, after they agreed to reduce their student body to 120 from nearly 200 students. Later in June, attorney David Winker filed an appeal regarding the Miami Planning Zoning & Appeals Board approval on behalf of his clients, a group of residents in nearby Buena Vista. The couple hired Greenspoon Marder, the same firm in which Mayor Suarez is of counsel, to represent them in obtaining the zoning exception from the city of Miami. [TRD]

Hurricane Dorian is strengthening as it prepares to hit Florida. After moving past Puerto Rico and the Virgin Islands on Wednesday, Dorian is in the Atlantic Ocean for the next few days and is moving northwest at 13 mph, according to the National Hurricane Center, the Miami Herald reported. As of Thursday at 5 a.m., the storm was about 150 miles north of San Juan. The forecast showed Dorian strengthened to maximum sustained winds of 85 miles per hour, an uptick from 80 on Wednesday night, according to the Miami Herald. [Miami Herald]

Three women were arrested last week for their roles in an affordable housing scam in Miami-Dade. Manuela Leonor Levy, Azalia Isabel Garcia and Aurora Mercedes Gomez were arrested by Miami-Dade Police last week on charges of an organized scheme to defraud, public records show. They allegedly took thousands of dollars from Section 8 housing applicants between October 2015 and July 2017 after promising to expedite the application process for affordable housing, according to NBC Miami. [TRD]

HGreg Auto and the former Toyota dealership (Credit: HGreg, Google Maps)

HGreg Auto and the former Toyota dealership (Credit: HGreg, Google Maps) parked $10.5 million into a vacant former Toyota dealership site in West Palm Beach. Mclean, Virginia-based Capital Automotive L.P., which is controlled by Brookfield Property Partners, sold the 24,794-square-foot-building for $423 per square foot, to HGreg Auto, records show. The 9.7-acre property sits at 551 South Military Trail close to the Palm Beach International Airport. [TRD]

Broker Jamie Maniscalco and Russell Galbut with 2901 Northeast Second Avenue

Broker Jamie Maniscalco and Russell Galbut with 2901 Northeast Second Avenue

Russell Galbut closes on a missing piece of his Edgewater assemblage. Developer Russell Galbut’s Crescent Heights closed on a corner piece of his assemblage in an Opportunity Zone in Miami’s Edgewater neighborhood, The Real Deal has learned. The Miami-based firm, which is planning a major mixed-use project on the land assemblage, paid $4.9 million for the 10,452-square-foot property at 2901 Northeast Second Avenue, according to a source familiar with the deal. It includes a 3,600-square-foot retail building. [TRD]

Compiled by Keith Larsen

Miami Beach board backs early last call for bars, restaurants

Clockwise from left: Foxhole Lounge, Bodega, Ricky’s, and the Firestone
In spite of protests from nightlife attorneys and the nephew of a prominent developer, Miami Beach’s Land Use and Development Committee backed the passage of an ordinance that will restrict the hours of operation for new bars opening on the west side of South Beach.
If the proposed ordinance is passed, future bars and alcohol-serving restaurants must close by 2 a.m. if they’re located on the west side of Alton Road from Fifth Street to the Collins Canal and within 100 feet of the south side of 17th Street from Meridian to Lenox Avenue in the Palm View Historic District. Right now, alcohol establishments in those areas, like most of South Beach, can stay open until 5 a.m.
“Nothing good happens in a restaurant after 5 a.m. except drinking,” said Commissioner Joy Malakoff, one of three Miami Beach commissioners who make up the Land Use Committee. Malakoff said the code is meant to protect the West Avenue corridor’s 10,000 residents from the impacts of South Beach nightlife.
But nightlife advocates fear the law will send a message to entrepreneurs not to invest in South Beach. “I am advising people to buy stock in Surfside,” said attorney Steve Polisar who claimed that the new law would send a message to restaurants and bars wishing to set up in Miami Beach that the city may move to restrict them.
The proposed code won’t affect bars and restaurants already open in western West Avenue and Palm View. Establishments not yet open that have already received building permits are also immune under the current draft of the ordinance. However, future establishments with signed leases or still in the midst of permitting will be beholden to the new regulations.
Jared Galbut, managing principal of Menin Hospitality and the nephew of Crescent Heights managing principal Russell Galbut, is afraid the new code will stop his plans to open two new late night eateries in the Palm View district. Both places are still in midst of the permitting process.
One of those restaurants, a barbeque and bar called Ricky’s, is slated to open next to Bodega, another Menin Hospitality establishment operating at 1220 16th Street. Both Bodega and the future Ricky’s are located in a building owned by Crescent Heights, purchased as part of a $14.5 million transaction with Twin City LLC in August 2013.
The other eatery and bar is proposed to open in the Firestone building at 1575 Alton Road, which another Crescent Heights subsidiary bought for $10 million at the end of December. Jared Galbut told the Land Use Committee that he wants to re-open his great-grandfather’s old diner, Al’s, inside the Firestone building.
But Gayle Durham, co-founder of the West Avenue Neighborhood Association, said the Firestone building is really going to be converted into a pseudo nightclub. “They are going to have outdoor drinking at five o’clock in the morning,” said Durham, who also complained about the noise and drunken crowds generated by Bodega.
Besides rolling back licenses by three hours in western Alton Road and Palm View, the proposed code will shut down sidewalk cafes by midnight, shutter rooftop bars by 11 p.m. (midnight on weekends), ban outdoor bar counters, and prohibit special events. Also, nightclubs that play amplified music or have live entertainment must be approved by the Miami Beach Planning Board.
A proposed ordinance must be approved twice by the full Miami Beach City Commission before it can be enacted as law. The ordinance’s first reading is April 13. The second reading could come as soon as May 21.

Source: The Real Deal Miami