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RESOLUTION APPROVING THE AMENDED AND RESTATED LEASE AGREEMENT BETWEEN WESTREC EQUITIES, INC. AND MIAMI-DADE COUNTY PURSUANT TO SECTION 125.35(1)(B)2, FLORIDA STATUTES; AND AUTHORIZING THE COUNTY MAYOR OR MAYOR�S DESIGNEE TO EXECUTE THE AMENDED AND RESTATED LEASE AGREEMENT AND TO EXERCISE ANY AND ALL RIGHTS CONFERRED THEREIN

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WHEREAS, this Board desires to accomplish the purpose outlined in the accompanying memorandum, a copy of which is incorporated herein by reference,

NOW, THEREFORE BE IT RESOLVED BY THE BOARD OF COUNTY COMMISSIONERS OF MIAMI-DADE COUNTY, FLORIDA, that:

Section 1. This Board finds that the improved value of the lease, under the terms of the Amended and Restated Lease Agreement between the County and Westrec Equities, Inc., (�Agreement�) in substantially the form attached hereto, is valued at over $20,000,000.

Section 2. This Board, pursuant to Section 125.35(1)(b)2, approves the Agreement, in substantially the form attached hereto, including the twenty-five (25) year extension on the term of the original lease, and authorizes the County Mayor or Mayor�s designee to execute such Agreement on behalf of the County and to exercise any and all other rights conferred therein.

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Date:

To: Honorable Chairman Dennis C. Moss
and Members, Board of County Commissioners

From: George M. Burgess
County Manager

Subject: Amended and Restated Lease Agreement with Westrec Equities, Inc. for Development of a New Dry Boat Storage Facility at Bill Bird Marina at Haulover Park and for additional 25 Year Extension

STAFF RECOMMENDATION
Recommendation
It is recommended that the Board approve the Amended and Restated Lease Agreement (�Lease�) between Westrec Equities, Inc. (�Westrec�) and Miami-Dade County, in order to provide for the development of a new boat storage facility at Bill Bird Marina, new and/or renovated bait and tackle facilities, improvements and renovations to the existing boat basin, and a new parking lot at Haulover Park and to extend the term of the Lease for an additional twenty-five (25) years, such that the Lease shall expire on April 30, 2040.

Scope
Bill Bird Marina is located at the northern end of Haulover Park at 10800 Collins Avenue, Miami Beach. It is open to all residents and visitors of Miami-Dade County. The proposed agreement is expected to have a County-wide impact.

Fiscal Impact/Funding Source
The direct fiscal impact to the County relating to this proposed agreement will be the positive revenue guaranteed through the Amended and Restated Lease Agreement�s, Minimum Annual Guarantee (MAG) and projected percentage of gross sales. The MAG amount over the term of the lease will be $21,600,000 with projected percentage of gross payments of $8,450,000 for a projected positive fiscal impact to the County of $30,050,000. Additionally, Westrec will invest a minimum of $11,400,000 in the construction of a first class boat storage facility. No County funds will be used in the construction related to this lease.

Track Record/Monitor
Westrec has operated, managed and maintained the dry boat storage operation and South Point bait and tackle store since May of 1995. Westrec has provided a level of service to the County and to the customers that meets or exceeds the requirements of the current agreement. The remittance of monthly fees has been consistent and timely. Additionally, Westrec has an outstanding track record of providing exceptional customer service and satisfaction.

Westrec Marina Management currently operates over 26 marina facilities in seven (7) states managing over 12,000 wet and dry storage spaces.

The new Agreement will continue to be monitored and managed by Jon Seaman, Miami-Dade Park and Recreation Department (MDPR), Contract Manager.

MANAGER'S BACKGROUND
Background
On July 19, 1988, an agreement (Attachment 1) was executed with Gold Coast Racks, Inc. for development and operation of a dry boat storage facility at Haulover Park. On May 1, 1995 the agreement (Attachment 2) was assigned to Westrec who has successfully operated the dry boat storage facility since that time. The dry boat storage facility currently provides for 265 dry rack boat storage spaces and includes bait and tackle and fuel dock operations, towboat services, operation of boat rental services and a snack bar.

Miami-Dade Park and Recreation Department (MDPR), working with the Department of Environmental Resource Management (DERM), has identified a location compatible with the Manatee Protection Plan for additional boat storage spaces to accommodate the growing boating industry and to offset the loss of dockage space resulting from commercial development of waterfront properties previously serving the boating community. Haulover Marina is cited in the Manatee Protection Plan as a facility recommended for increased boat storage facilities. Consequently, a Development of Regional Impact study is not required for this project.

The current lease with Westrec for the existing dry boat storage facility, including all options to renew, ends April 2015 and does not provide for capitalization of a large capital investment in refurbishing or rebuilding the facility. This new Lease requires Westrec to invest no less than $11,400,000 to construct capital improvements at Haulover Park to include a 508-slip (243 additional slips), fully enclosed dry storage facility in the area north of the existing open rack system as well as renovation of the existing South Point bait and tackle store, demolish and replace former dry rack storage facility, remove existing underground fuel tanks and replace entire area with a new paved parking lot. When construction is complete, the Marine Center fuel dock will be eliminated and the Point Store and fuel dock will be fully renovated. Additionally the new boat storage facility will be able to accommodate larger boats as the average length and beam width and weight of boats increases due to improvements in lift technology and storage space design.

Upon the completion of construction and beginning no later than May 1, 2015, the guaranteed minimum annual rent paid by Westrec to the County will increase from $65,000 per year to $300,000 for year 1, $400,000 for year 2, $500,000 for year 3, $600,000 for year 4, $650,000 for year 5, $700,000 for year 6, $750,000 for year 7, $800,000 for year 8, $900,000 for year 9, and $1 million per year in years 10-25. Additionally, for years 1-12, starting in 2015, Westrec shall pay the County the greater of the minimum annual rent or 18% of gross revenues.

Lease Year
Minimum Annual Guarantee (MAG)
Projected Percentage Of Gross (18%)
2015
$300,000
$570,695
2016
$400,000
$584,692
2017
$500,000
$655,980
2018
$600,000
$672,380
2019
$650,000
$692,551
2020
$700,000
$713,328
2021
$750,000
$734,728
2022
$800,000
$756,759
2023
$900,000
$775,689
2024
$1,000,000
$798,959
2025
$1,000,000
$822,928
2026
$1,000,000
$847,616
2027 - 2040
$1,000,000
MAG Only
With the capital investment of $11,400,000, combined with the guaranteed minimum annual rent payments through year twelve (12), the present value of the project is $21,000,000 and the discount rate used for this calculation was 5%. State Statue (F.S. 125.35) allows for the extension of a lease for an additional term not to exceed 25 years, provided that the improved value of the lease has an appraised value in excess of $20 million. The estimated revenue to the County is in excess of $21,000,000.00 over the twenty-five year term.

The proposed lease terms were vetted by the Lambert Advisory Group, Inc. a firm specializing in marina cost recovery analysis and economic feasibility related to marina facility development. The Lambert Advisory Group strongly concurred with staff that the payment terms and correlating capital development in the proposed lease will equate to revenues to the County that significantly exceed similar agreements with other municipalities in this region.

This new facility will accommodate boats that are bigger, longer, wider and heavier, keeping up with trends in the industry. The facility will also increase the capacity to an additional 243 new boat storage spaces. In addition to the increased capacity of the facility, the relocation of the boat barn will allow for the opening of three (3) additional boat ramps available to the boating public and an increase in boat trailer parking at the marina. Upon completion, Westrec will demolish, upgrade and refurbish the current dry rack storage leased area and pave it to provide additional vehicle and trailer parking areas and that property shall revert back to the County. This will further facilitate the development of a new traffic plan for the park. Westrec has also agreed to upgrade and renovate its existing bait and tackle store at the southern end of the park.

This Agreement is in the best interest of Miami-Dade County and revenues resulting from this agreement will benefit the entire County.

Attachments

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Alex Mu�oz
Assistant County Manager