Miami-Dade County

Miami says it’s ‘far apart’ in early talks with David Beckham over MLS stadium

Soccer on the slip? Gimenez has asked Beckham’s group to consider building its soccer stadium by filling in a large boat slip downtown.
Soccer on the slip? Gimenez has asked Beckham’s group to consider building its soccer stadium by filling in a large boat slip downtown. MIAMI HERALD STAFF

For months, David Beckham’s Major League Soccer venture has said it will pay some sort of annual rent — “fair,” “market” or “reasonable” — to build a stadium on prime public land.

Yet the number Beckham’s representatives have floated in early talks with the city of Miami is so low that the city manager has called for the two sides to “take a breather.”

That figure: $500,000 a year, according to the city.

Miami says it has not countered with a figure of its own, but it’s far higher than $500,000 — as high as $12 million to $14 million, City Manager Daniel Alfonso said Monday.

“We’re just too far apart,” he told the Miami Herald.

Alfonso had initially asked city consultants to take a look at how a potential deal with Miami Beckham United might work financially if the investors filled a deep-water water basin known as the Florida East Coast Railway slip to build a 20,000-seat stadium.

Monday, the manager said he had called off that request, at least for now. Alfonso said he did not want Miami to spend money studying the possibility until the city gets a better sense of how much Beckham’s group is willing to offer.

John Alschuler, Beckham’s real-estate advisor who is leading the discussions with the government, declined to comment Monday on the talks. He said in a wide-ranging interview last week that the venture is committed to negotiating with the city in private.

“We’ve said we’ll make a fair payment,” he said at the time, without denying the $500,000 figure. “We have a range of what we think we’re able to pay.”

Politically, it is in the city’s interest to play coy in the negotiations. In the wake of the unpopular public-financing deal for the Miami Marlins’ Little Havana ballpark, which was built on the site of the old Orange Bowl, it is risky for elected leaders to support stadium deals. City officials have to be able to sell any agreement they might put before voters in a November referendum.

“We came late to this discussion,” Mayor Tomás Regalado said, noting Beckham’s initial interest in building a stadium on county-owned land at PortMiami. “We have to defend the interests of the city of Miami.”

He added that reaching an agreement would be “an uphill battle,” and suggested unprompted that the idea of building a soccer stadium next to Marlins Park is not entirely off the table — though Beckham’s team has dismissed that site.

“Plan C is the Orange Bowl — even if it’s ‘spiritually tainted,’ ” Regalado said, citing a critique by Beckham’s business partner, Simon Fuller.

Beckham’s group has said it would use mostly private funds to fill the boat slip, landscape the new land and construct the stadium, a project investors estimate could cost about $250 million in total. The venture also intends to seek a state subsidy.

The potential deal would require the city to give up 4.2 acres of green space belonging to the soon-to-open 19-acre Museum Park, which is next to the boat slip and is set to open June 14. In return, Beckham’s group would add 8.5 acres to the east for a net gain of 4.3 acres, though that calculation includes the property behind AmericanAirlines Arena known as Parcel B, which belongs to Miami-Dade County and has long been promised as a park.

As part of a land swap, the county would turn over Parcel B to the city for Beckham to develop. The city would turn over the footprint of the soccer stadium to the county so the MLS franchise would not have to pay property taxes.

County Mayor Carlos Gimenez has said he would require an annual payment from Beckham’s team — a combination of rent and a payment in lieu of taxes — that he would then probably turn over to Miami to benefit parks maintenance and operations across the city. That is the $500,000 “annual rent” in question.

The county hasn't been involved in the early talks.

Beckham’s group has said it cannot afford to pay for stadium construction and also buy private land, at least not in the coveted downtown locations the investors want.

“What we said was that the city of Miami looks at this property as a unique piece of real estate — extremely valuable,” he said.

At issue is how to appraise the value of the property, which is now either submerged or zoned for a park and, as such, does not allow for commercial or residential construction. Since appraisals are based on what can be built on a property, a park has relatively little value on the books, even if it is prized as a matter of public policy.

Alschuler said last week that the property should be appraised at a higher value than for an undevelopable park use. But, he added, it should also not be valued at the highest possible use — say, for an office or condo high-rise — because the city would likely never allow such construction there, and a stadium would not be as profitable.

That’s what usually makes public land cheaper to build on. If the potential stadium site were assigned a value similar to the Miami Worldcenter — a multiblock hotel and convention center project at the nearby site of the old Miami Arena — “that’s not affordable for us,” Alschuler said by way of example.

When the Miami Herald’s parent company sold its waterfront headquarters and surrounding properties in 2011, Malaysian casino giant Genting paid $236 million for about 14 acres — about $17 million an acre.

The 10-acre boat slip, as mostly water that can be used to dock tall ships, is valued at about $12 million, or about $1.2 million an acre.

The Miami-Dade property appraiser values the county-owned AAA, which is just south of the slip, at about $26 million for 11 acres, or about $2.4 million an acre.

On Tuesday, the Miami-Dade County Commission is set to vote on a new deal for AAA that would eventually increase the annual subsidy to the Heat to $8.5 million, from $6.4 million. In exchange, the team would immediately begin to make an annual $1 million donation to the county’s parks department, and the Miami Heat would continue to play in the arena for five additional years, until 2035.

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