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Florida voters say yes to SkyRise tower, but now what?

By   /   September 9, 2014  /   News  /   No Comments

By Marianela Toledo | Florida Watchdog

MIAMI — Voters say a skyscraper at the downtown Bayside Marketplace is a good idea, but some question whether voters actually knew what they were approving.

“I am opposed to the (SkyRise tower) project because it violates the city charter (and) because if the tower never gets constructed, the city has already renewed the Bayside Marketplace contract for 99 years for about $1 million (a year),” said Grace Solares, a community activist who challenged the referendum in court.

Artistic rendering

IN THE HEIGHTS: Some voters did not known the developer asked the Legislature for incentives to build the SkyRise tower.

Florida Watchdog previously reported an analysis by the city pegged the market rate for the public property that Bayside Marketplace leases at around $3.2 million annually, and upwards of $4.6 million annually if the SkyRise tower was included.

But Solares said voters were duped into thinking they were going to be getting market rents for the lease renewal when they went to the polls Aug. 26. In fact, the lease contract between the city and Bayside lets the developer off the hook for the higher rent rates should SkyRise developers back out of the deal.

“Officials told the voters that we were going to receive more than $3.4 million (in exchange for extending the Bayside lease, and approving the SkyRise project.) But if (developer) Jeffrey Berkowitz decides not to build the tower, we are only going to get around $1 million (a year) for 99 years,” Solares said.

Voters also were told the city would receive $10 million upfront, a percentage of the rent and a minimum of $27 million in improvements to Bayside Marketplace, including additional parking.

SkyRise has no shortage of supporters. Among them are Florida Democrat U.S. Reps. Joe Garcia and Debbie Wasserman Schultz, U.S. Sen. Bill Nelson, D-Fla., and former Port of Miami Director Bill Johnson.

Miami Mayor Tomás Regalado also supports the project, claiming in a radio spot, “residents of Miami win by not having to put in a cent.”

If built, SkyRise will be Florida’s tallest building. Plans call for a restaurant, private club, three observation decks, ballroom, bungee-jumping base, a free-fall ride and other attractions. It is expected to be completed by mid 2017.

SkyRise developer Berkowitz will sublease the land from Bayside, rather directly from the city.

The project is expected to create around 7,100 jobs during its development phase, and 17,000 after its opening, according to its developer.

According to the ballot question, SkyRise will be privately funded at a cost of $400 million. But recent reports indicate otherwise.

Blogger Al Crespo reported in February the Miami-Dade County Commission adopted a resolution, sponsored by Commissioner Bruno Barreiro, “urging the Florida Legislature to provide funding for SkyRise Miami.”

In May, Florida TaxWatch released its annual list of budget “turkeys” — line-items tucked onto the budget without public evaluation and thorough budget scrutiny — flagging a $2 million subsidy given to the SkyRise project through the Florida Department of Transportation.

Florida Watchdog tried contacting Berkowitz to ask him about the subsidy, but he hasn’t responded to emails.

Berkowitz reportedly is trying to get $270 million in investments through the federal EB-5 immigration investor program, coupling that with other investor dollars and his own money, Miami Today reported earlier this year.

The EB-5 visa doles out green cards to foreigners who invest at least $500,000 in a project that creates at least 10 jobs. If the investment pans out, the foreigner eventually can apply for permanent U.S. citizenship.

However, as previously reported by Watchdog.org, a lack of oversight in the EB-5 program has left some foreign investors with lighter wallets and nothing in return.

A December 2013 study by the Department of Homeland Security’s inspector general found that the government “cannot demonstrate that the program is improving the U.S. economy and creating jobs for U.S. citizens.”

The Brookings-Rockefeller Project on State and Metropolitan Innovation in February concluded that “knowledge of the program’s true economic impact is elusive at best,” Forbes magazine reported.

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Marianela formerly served as staff reporter for Watchdog.org.