Everyone agrees that Lincoln Road could use a makeover.
South Beach’s iconic outdoor mall hasn’t had a major renovation in more than 20 years and needs to be fixed up, including replacing worn-out pavement, installing new lighting and dealing with flooding. As the area faces increasing competition from Wynwood, Brickell and other popular tourist destinations, the need for an overhaul has grown more urgent.
“Lincoln Road hasn’t been renovated since 1995 and though it is still a magical place that people love and go to, it’s starting to show its age and it’s fraying around the edges,” said Timothy Schmand, the executive director of the Lincoln Road Business Improvement District.
But the question is who will pay for the renovations.
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The master plan for the area, developed by James Corner Field Operations — the landscape architecture firm best known for designing the High Line in New York City — will cost at least $77 million. Miami Beach and Miami-Dade County have set aside $50 million in tax revenue from the Center City Redevelopment Area, a taxing district set up in the early 1990s to revitalize a swath of South Beach. An additional $9.4 million has been earmarked from other city funds, including a recently approved general obligation bond program.
That still leaves a shortfall of at least $17 million, however.
At a meeting on Tuesday, city officials asked Lincoln Road businesses to contribute at least $8 million to cover some of the artistic elements of the plan, including public art. One city commissioner, Ricky Arriola, urged the businesses to pitch in even more — approximately $20 million.
“They’ve enjoyed an amazing two decades of property appreciation and they should continue to invest in the street and the master plan because it’s going to benefit them,” Arriola said.
That proposal didn’t sit well with some area property owners, however, who argue that Lincoln Road is a public space comparable to a park and therefore the city’s financial responsibility to renovate and maintain.
“We’re willing to contribute to the betterment of Lincoln Road significantly, but we do not think that it’s our obligation to have to pay for pavement, for drainage, for trees,” said Steve Gombinski, president of the Business Improvement District and the owner of a building on the pedestrian mall. “We’ve contributed upwards of $140 million in taxes over the last five years and the street has not been maintained.”
Gombinski added that property owners have also invested hundreds of millions of dollars in the construction and renovation of privately owned buildings, which has boosted property tax revenues.
“We’re not asking for corporate welfare,” he said. “We’re asking for our tax dollars to be spent fairly on us as they are on others.”
Lyle Stern, a Business Improvement District board member and president of the real estate leasing company Koniver Stern Group, noted that it was the city and not business owners who commissioned the master plan, which was developed with input from residents and businesses.
“We’re prepared to participate in a reasonable level of participation, but Lincoln Road is a city-owned street, and the city, this community, has already said what it wants this road to look like,” he said.
Although it’s ultimately up to the Business Improvement District’s board to decide, Stern and Gombinski said they would both support business owners making a financial contribution to the project, but didn’t consider $20 million a reasonable request.
The plan for Lincoln Road has been in the works for the past five years.
Miami Beach hired James Corner Field Operations in 2014 to come up with a master plan for the area, which is steps away from the Miami Beach Convention Center and sees 11 million visitors a year. In addition to upgrading aging infrastructure, the plan calls for adding more green space, reorganizing the outdoor cafe tables, creating more public seating, and adding or renovating public art and performance spaces.
“What’s awesome about the plan is it provides much more connectivity,” said Commissioner John Elizabeth Alemán. The makeover of the pedestrian mall is an important part of the overall plan for the convention center area, she said, which includes the newly renovated $620 million convention center and plans to build a headquarter hotel. “We absolutely want it to be a world class destination,” she added.
But business owners are going to benefit from the renovations, Alemán said, and should be asked to chip in, although she wouldn’t say exactly how much she expects them to contribute.
“The property owners throughout that whole area are going to get a property value uplift, and I think it is very reasonable for them to help pay for the overall implementation,” she said.
In order to contribute to the project, business owners would likely need to form a special taxing district, which means they would be sending more money into public coffers. The Business Improvement District’s executive committee plans to discuss the idea on Monday before the full board votes.
Once business owners and the city settle on who’s paying for what, the next hurdle is to ensure that construction doesn’t put stores out of business, as it has in other parts of Miami-Dade County.
“It needs to be done respectfully block by block or half block by half block so we allow the businesses to thrive and survive,” said Commissioner Michael Góngora. “My biggest fear is that the businesses that are there now won’t survive the project and then a new tenant will come in and enjoy the fruits” of the renovations, he said.
Another challenge is finding a way to attract more local families and mom-and-pop businesses to Lincoln Road. The pedestrian mall is one of the most expensive shopping streets in the country, according to Business Insider, and high rents have pushed some small businesses to either close or relocate.
At Tuesday’s meeting, Arriola said, “there was very strong support to see more local operators and mom-and-pops and less of the national retailers that have really priced out the mom-and-pops and for many people made Lincoln Road uninteresting.”
In a market where even big retail companies struggle to compete with online shopping, however, that could prove to be the biggest challenge yet.