2011-0915 Regular City Commission Meeting

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---- -- - --- Summary Minutes: Regular City Commission Meeting September 15,2011 City of Sunny Isles Beach, Rorida color. Vice Mayor Thaler said the other colors that are on the beach now will be taken off and used in other places. Commissioner Gatto moved and Vice Mayor Thaler seconded a motion to approve the resolution. Resolution No. 2011-1775 was adopted by a voice vote of 5-0 in favor. lOX. A Resolution of the City Commission of the City of Sunny Isles Beach, Florida, Approving an Updated Letter oflntent Between the City of Sunny Isles Beach and The Weintraub Companies for the Purchase of 18080 Collins Avenue ("Alamo Property"), in the Amount of $7,500,000.00, Attached Hereto as Exhibit "A"; Authorizing the City Manager and City Attorney to Do All Things Necessary to Effectuate this Resolution; Providing for an Effective Date. Action: [City Clerk's Note: Amendment to Revised Letter of Intent distributed prior to meeting. See additional action under Item 4A.] City Clerk Hines read the title, and City Manager Cohen reported there have been some significant revisions made to the Letter of Intent that the Commission authorized at the last Commission meeting. In essence it changes the agreement from an outright purchase to a lease/option to buy arrangement, the ultimate purchase price is still $7.5 Million, the deal structure is still the same. The Weintraub Group has already provided us with $100,000 deposit, another $100,000 would come to us once the lease agreement is ratified and signed by the Commission, an additional $800,000 at Site Plan Approval, another $500,000 would come to us soon after that, and then another $1.5 Million after a TCO is issued. After that there would be a 25-year lease with rent payments equal to $4.5 Million plus a 5.5% interest rate. One item of note is that the Commission in the past had agreed to waive some of the FAR Bonus Fees, Counsel had advised that it is better if we go a different route, and the revised Letter of Intent also accommodates the City providing some TDRs to the developer in lieu of the waived Bonus Fees. Public Speakers: Abraham Weintraub Commissioner Scholl said then that the economics haven't changed, just the legal structure of the deal, and City Manager Cohen said that was correct, and in particular it does two very important things, it takes the City out of the position of being a banker and so the City is not going to be holding the mortgage. Secondly the City maintains title on the property until an actual purchase is consummated at the end of the deal and so the City is in a stronger position. Commissioner Scholl said then that it actually puts more risk on the developer as opposed to the City because the City would not have to foreclose and perfect its position to get the property back if the developer defaulted. Vice Mayor Thaler said that they would have the right to prepay. Commissioner Aelion asked if the interest of 5.5% is the interest throughout the life of the lease, and City Manager Cohen said yes, the meaning and intent is clear for our purposes for the Letter of Intent, we will be presenting a more detailed lease agreement that will have much more extensive language. Commissioner Scholl asked the developer if this arrangement still enables him to employ the financial structure that was discussed last time, is he still comfortable that his financial structure works under this arrangement, and Abraham Weintraub said basically what happens is that the structure before wouldn't allow for the actual condominium sales, you wouldn't be able to transfer condominium units, and this allows them to do condominium units. 16