Miami-Dade County

Massive Little Haiti project and $31M aid get initial OK — but not a green light yet

Magic City Innovation District is coming to Little Haiti

Neil Fairman, chairman of Plaza Equity Partners, one of the developers of the Magic City Innovation District, leads a tour of the site of the mixed-use development in Miami's Little Haiti neighborhood on Monday, Sept. 10, 2018.
Up Next
Neil Fairman, chairman of Plaza Equity Partners, one of the developers of the Magic City Innovation District, leads a tour of the site of the mixed-use development in Miami's Little Haiti neighborhood on Monday, Sept. 10, 2018.

A mammoth commercial and residential project that would irrevocably alter Little Haiti won an initial go-ahead from Miami commissioners early Friday — along with a hotly debated $31 million aid package from the developers to soften its impact on the impoverished community.

For developers of the proposed Magic City Innovation District, the fourth time was the charm. Three times before, consideration of the project, which would sprawl over nearly 18 acres straddling Northeast 62nd Street, was put off amid contentious debate over the development’s repercussions and questions over the value of the proffered community benefits.

Well past midnight, after hours of public testimony and discussion, commissioners voted 4-0 on first reading to approve a Special Area Plan, named after a section of the Miami 21 zoning code that allows increased flexibility for properties over nine acres, for the Magic City development. Commissioner Joe Carollo had left the meeting earlier.

The project would bring towers as tall as 25 stories to a low-scale neighborhood of modestly scaled one- and two-story buildings, raising fears of accelerated displacement in Little Haiti amid a wave of gentrification.

But the vote did not mean Magic City’s developers have a clear green light for takeoff.

The commission approval, which must be ratified in a second vote on June 27, came only after commissioners and city planners pressed the developers for some potentially significant improvements in the aid package to address concerns from critics who say it doesn’t provide enough guaranteed benefits for the community. Among those tweaks: accelerating the payments from the developer, which under the agreement would be paid out only gradually as construction progressed over 15 years, and adjusting the payments for inflation.

A motion by Commissioner Keon Hardemon, who represents Little Haiti, also asks the developers to host two “town hall” meetings in the neighborhood and explore the possibility of establishing a college scholarship fund for local residents. Hardemon called it the Robert Zangrillo fund, a reference to a Magic City partner charged in a federal investigation for allegedly bribing officials at the University of Southern California to admit his daughter.

The managing partner for the development team, Neil Fairman, tried to parry, saying his board had already approved about all it could feasibly provide. But he and attorney Neisen Kasdin pleaded for a positive vote, saying further delay could spell the end of the project. Fairman said he was making no promises, but was open to further discussion with the city.

“I’m willing to try and make a deal. But the expectations have to be realistic,” he told commissioners. “I will go back to my board and do my best. I want to do this project. It’s going to be great for Little Haiti.”

Separately, commissioners also approved creation of a Little Haiti Revitalization Trust to receive the $31 million from the developers, a trio of Miami-based real estate firms comprising Plaza Equity Partners, Metro 1 and Dragon Global. The trust, to be governed by a five-person board, would decide how to spend the money to provide affordable housing, job and business training and other benefits to Little Haiti.

The trust was proposed by Hardemon, who embarked on a solo negotiation with the developers for the past couple of months over the benefits package. The Hardemon package calls for the developer to contribute $6 million within six months of final approval by the commission, with the balance paid out as the project proceeds in phases.

But that offers less of a guarantee than a previous version of the agreement that required the developers to build or finance construction of affordable and workforce housing, noted city planning director Francisco Garcia.

“We can improve upon that,” Garcia told commissioners.

Hardemon and Commissioner Manolo Reyes then took the lead in pushing the developer to enhance the benefits package by tying payments to a schedule. Dribbling the money out over time would blunt its potential beneficial impact, they agreed.

“Getting it piecemeal like that, I think it loses its effectiveness,” Reyes told the developers.

In a bit of brinkmanship, Hardemon hinted he would make a motion for postponement of the vote if Fairman would not at least consider changes to the agreement.

“I want you to give it some serious, serious thought,” Hardemon said.

The Magic City project was endorsed by some prominent community leaders, including the Rev. Reginald Jean-Mary, pastor of Notre Dame D’Haiti Catholic Church and a newly formed coalition called Concerned Leaders of Little Haiti, which includes activist Gepsie Metellus and Leonie Hermantin. Unite Here Local 355, the Miami chapter of the country’s largest hotel union, spoke in favor of the project.

Some of the supporters expressed concern over the fact that the agreement negotiated by Hardemon relieved the developers of building affordable or workforce housing as part of their project. Their original offer committed them to build 550 units of below-market-rent apartments, either on site or within a tight radius of the project.

But Hermantin said she hopes the newly approved trust can address what several speakers described as a housing crisis in Little Haiti, which is being buffeted by real estate speculation and displacement of longtime residents and businesses by gentrification. Hardemon has suggested the trust could combine payments from the developers with portions of a city bond issue to build affordable housing.

“We feel that in light of existing state of gentrification in little Haiti, we welcome the chance to create a trust,” Hermantin told commissioners during the public hearing. “It’s a great strategy to offer businesses, owners, renters the opportunity to really benefit from what is going to happen.”

But numerous opponents said the proffered benefits were insufficient compared with the potential displacement from the massive development, where residents must make $70,000, well above the neighborhood median income, to afford an apartment. More than 40 percent of Little Haiti residents live below the poverty line.

Marleine Bastien, director of the Family Action Network Movement, called the proposed towers “grossly out of sync” with the surrounding one- and two-story buildings that characterize Little Haiti. She criticized the Special Area Plan process as “a fast-track mega-development model” and called for a moratorium on new ones in Little Haiti, noting that one other major such project is awaiting public review.

“It is unwise, unethical and should not move forward as it stands,” Bastien said of Magic City.

The advantage of his deal, Hardemon said last month, is that the trust would have almost immediate access to $6 million and could put it to use quickly. But the agreement does not guarantee that the developer will ultimately pony up the full amount should the project fail or construction otherwise come to a halt.

The developers’ plan calls for the project to be built in phases, starting shortly after approval with a pop-up theme park designed by one of the founders of the Cirque du Soleil empire. That complex would occupy vacant land once part of the old Magic City tourist campground and trailer park, after which the development is named. (The developers have also undertaken pricey renovations of about 20 existing warehouses on their property surrounding the campground site and are marketing those now for lease.)

The next phase after that, slated to begin in 2020, would be construction of new retail and office components, with housing construction not coming up until later.

Earlier, the four commissioners present all gave initial approval to creation of a Little Haiti Revitalization Trust. Commissioner Joe Carollo was absent for the vote.

Before the vote, sponsor Hardemon argued that whether the Magic City project passes or not, Little Haiti needs a board of community members to promote economic development, business and commerce in Little Haiti. According to the ordinance, the trust would have the ability to apply for and spend grant dollars, make recommendations on major developments in the area and partner with other public and private entities to pursue economic revitalization projects.

Hardemon described a board that would push for the creation of jobs and advocate for housing issues.

“What I’m trying to ensure is that there’s a way we can have some advocate for the community, but the benefit comes back to the community, not necessarily to that group,” he said.

In particular, Hardemon believes that homeownership should be a priority in addressing the city’s affordability problem, as opposed to focusing on the rentals market.

Mayor Francis Suarez commended Hardemon as he expressed support for the trust concept.

“Putting something in place, that has a very specific mission to help revitalize an area, is critical,” Suarez said.

This article has been changed to correctly reflect hotel union Unite Here Local 355’s support for the Magic City Innovation District project.
Andres Viglucci covers urban affairs for the Miami Herald. He joined the Herald in 1983.
Joey Flechas covers government and public affairs in the city of Miami for the Herald, ranging from votes at City Hall to neighborhood news. He won a Sunshine State award for revealing a Miami Beach political candidate’s ties to an illegal campaign donation. He attended the University of Florida.