HomeMy Public PortalAbout2013 Waronker_Rosen_IncSelf-Contained Appraisal Report
Prepared for
Mr. Mitchell Burnstein, Esq.
Attorney At Law
Weiss Serota Helfman Pastoriza Cole & Boniske, P.A.
Property Appraised
Commercial Land
12 & 24 Crandon Boulevard
Key Biscayne, FL 33149
Date of Valuation
April 30, 2013
Prepared by
Waronker & Rosen, Inc.
5730 SW 74th Street, Suite 200
South Miami, Florida 33143
LEE H. WARONKER, MAI, SRA
CARLOS DIEZ, APPRAISER
File # 7430
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 1
Waronker &Rosen, Inc.
Real Estate Appraisers and Consultants
Miami-Dade County Office Broward / Palm Beach County Office
5730 SW 74th Street, Suite 200 10242 NW 47th Street, Suite 40
South Miami, Florida 33143 Sunrise, Florida 33351
Lee H. Waronker, MAI, SRA Phone: (305) 665-8890 / Fax: (305) 665-5188 Josh L. Rosen, MAI
lee@waronkerandrosen.com www.waronkerandrosen.com josh@waronkerandrosen.com
May 31, 2013
Mr. Mitchell Burnstein, Esq.
Attorney At Law
Weiss Serota Helfman Pastoriza Cole & Boniske, P.A.
2525 Ponce de Leon Blvd, Suite 700
Coral Gables, FL 33134
Re: Commercial Land
12 & 24 Crandon Boulevard
Key Biscayne, FL33149
WRI File No. 7430
Dear Mr. Burnstein:
We have prepared a Self-Contained Appraisal Report of the above referenced property for the
purpose of estimating the As Is market value of the fee simple interest as of April 30, 2013. This
report has been prepared based on the scope of the work which is detailed on a following page.
The reader of the appraisal is strongly advised to read the scope of work so as to understand the
scope of this appraisal.
This report is intended for use only by the client and intended users as noted herein. No
additional intended users are identified or intended. Use of this report by others is not intended
by the appraiser. No one else, or any other entities, should rely on this appraisal other than those
noted herein.
The subject property is located at 12 and 24 Crandon Boulevard, Key Biscayne, Miami-Dade
County, FL. It consists of two parcels with a combined land area of 62,075 square feet (1.43
acres). Zoning on this site is C-1, Low Intensity Commercial District by the city of Key
Biscayne, FL.
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 2
Mr. Mitchell Burnstein, Esq.
Weiss Serota Helfman Pastoriza Cole & Boniske, P.A.
May 31, 2013
The subject property consists of two contiguous segments owned by two entities: a 14,000 sq. ft.
parcel located toward the north and east portion of the site (called the Kayjo parcel throughout
this report), and a 48,075 sq. ft. parcel located toward the west and south portion of the site
(called the Stefano’s parcel throughout this report). The Stefano’s parcel is owned 100% by Key
Biscayne Gateway Partners, Ltd. (KBGP). The Kayjo parcel is owned jointly by Kayjo, Inc. and
KBGP. Kayjo, Inc. owned a 100% interest in the Kayjo parcel until June 2012, when it
transferred a 22.5% interest to KBGP in exchange for termination of a parking easement that
encumbered the Stefano’s parcel in favor of the Kayjo parcel. The parking easement was
terminated by KBGP and Kayjo, Inc. in October 2011. Subsequent to the termination of the
parking easement and KBGP’s purchase of a partial interest in the Kayjo parcel, the owners
began marketing the combined 62,075 sq. ft. tract (now unencumbered by parking easements and
available to develop as a combined site) as a land lease.
In December 2011, the owners obtained a Letter of Intent to enter into a land lease from J.P.
Morgan Chase Bank for construction of a retail bank branch on the south part of the site. The
offer was conditional upon having cross-access agreements in place with the owner of the
adjoining property to the west providing access to the site from Harbor Drive. According to the
owners, this offer was later rescinded due to interference from the City and the threat of eminent
domain actions (see the Puyanic Letter in Addendum C). Subsequently, the owners secured a
land lease from Walgreens for construction of a Walgreens store on the north part of the site.
Though a copy of this lease was not provided, the owners indicated that it is fully executed. The
owners did not disclose what conditions the lease may be subject to, but the site plans provided
(see page 15) to the appraisers indicate cross-access points along the west perimeter. It is not
known if the proposed Walgreens store would be contingent upon having cross-access in place
with the adjacent center, providing access from Harbor Drive. However, requiring a cross-access
agreement to be in place would be consistent with typical practice by retailers such as Walgreens
and banks such as J.P. Morgan Chase, which usually select corner locations or locations that
provide ingress or egress from an alternate street (such as through easements or access
agreements). According to the owner, this proposed site plan was rejected by the city because the
cross-access was not approved.
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 3
Mr. Mitchell Burnstein, Esq.
Weiss Serota Helfman Pastoriza Cole & Boniske, P.A.
May 31, 2013
The reader should note that the analysis indicates that the As Is value, which reflects the current
situation with cross-access not in place, is below the potential value if cross-access were
permitted. This is based on our analysis of the Walgreens lease and previous letter of intent from
Chase Bank, which are believed to be reliable indicators of the value of the subject property
assuming cross-access with the adjacent property (providing access to the site from Harbor
Drive) is in place. The analysis indicates that the value with the leases in place (which assumes
cross-access is approved and functioning), would be on the order of 36% higher than the As Is
value estimated herein.
In order to prepare the analysis, we were supplied with the following items:
A. Sketch of survey and site plans (page 15) for a proposed free-standing Walgreens store to
be constructed on the north portion of the site, provided by the property owners.
B. Copy of a Letter of Intent from J.P. Morgan Chase Bank dated December 2, 2011, for a
land lease and proposed free-standing bank branch to be constructed on the south portion
of the site, provided by the property owner. According to the owner, this offer has since
been rescinded.
C. Copy of an agreement terminating a parking easement between the owner of the
Stefano’s parcel (KBGP) and the owner of the Kayjo parcel (Kayjo, Inc.), dated October
11, 2011. The easement had previously encumbered the Stefano’s parcel in favor of the
Kayjo parcel.
D. Copy of a letter dated January 30, 2008 from Kayjo, Inc.’s attorney to the tenant of a
building on the Kayjo parcel inviting them to exercise a right of first refusal in
connection with a purchase contract for purchase of the Kayjo parcel by the previous
owner of the Stefano’s parcel (Samoro, LLC). A copy of the purchase contract, dated
January 29, 2008, was also provided. These were provided by the property owners.
E. Copies of several recorded deeds relating to sales of nearby parcels and a letter
explaining the history of these sales and the history of the subject property, provided by
the property owners.
F. Letter from Mr. Max D. Puyanic (see Addendum C), the property representative.
Any deviation from the information supplied and assumptions used herein will likely result in a
change of value.
Mr. Mitchell Burnstein, Esq.
Weiss Scrota Helfman Pastoriza Cole & Boniske, P.A.
May 31, 2013
As a result of our investigation, it is our opinion that the As Is market value of the fee simple
interest as of April 30, 2013, is in the amount of
ELEVEN MILLION DOLLARS
(511,000,000)
On the following pages is the table of contents and scope of work followed by the certification
and general assumptions and limiting conditions. It is advised that these items be reviewed so the
reader has an understanding of the limitations of this appraisal.
Very truly yours,
C. Waronker, MAI, SRA
fate -Certified General Real Estate Appraiser
License No. RZ162
cert
Carlos Diez
State -Certified General Real Estate Appraiser
License No.RZ3420
Waronker & Rosen, Inc. •.'• Real Estate Appraisers & Consultants Page 4
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 5
Table of Contents
Title Page
Letter of Transmittal 1
Table of Contents 5
Scope of Work 6
Certification 7
General Assumptions and Limiting Conditions 9
INTRODUCTION 11
Summary of Pertinent Data 12
Dade County Map 13
Plat Map 14
Aerial Photograph 15
DESCRIPTION & ANALYSES 24
Purpose of the Appraisal 25
Client, Intended User and Use of the Appraisal 25
Definition of Real Property Interest Appraised 25
Definition of Market Value 26
Location and Address 27
Owner of Record 27
History of the Subject Property 28
Legal Description 29
Site Data 30
Zoning 30
Flood Zone 30
Real Estate Assessment and Taxes 31
Description of the Improvements 32
Neighborhood Overview 33
Supply and Demand 34
Exposure Time 37
Typical Purchaser of the Subject 37
Highest and Best Use 38
Appraisal Process 39
Cost Approach 40
Income Capitalization Approach 41
Sales Comparison Approach 42
Reconciliation of Value 64
ADDENDA
Addendum A – County Area Description
Addendum B – Flood Zone Map
Addendum C – Additional Data
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 6
Scope of Work
The appraisal problem herein is to estimate the market value of the fee simple interest of the
subject property. The approaches used are considered sufficient to develop credible assignment
results in solving the appraisal problem.
All appraisals begin by identifying the appraisal problem. Data on the subject property can be
derived from various sources including but not limited to, the property owner, the county
property appraiser’s office, surveys and building plans. When possible, more than one source is
utilized to confirm data and the data sources are acknowledged. Land size is based on surveys
(when available), public records and recorded plats. Land measurements are not performed.
Description of the improvements is based on a visual inspection and plans (when available). The
age of the building is based on public records. Appraisers are not structural engineers and
therefore cannot attest to the soundness of a structure. Noticeable potential problems such as
stress cracks and water damages are noted, if evident.
Next, a search is performed for comparables to the subject property. Research of comparables
and market data include, but is not limited to, using the following data sources:
CoStar
Imapp
Newspaper clippings
Board of Realtors’ Multiple Listing Service
Tri County Clippings Services (FREDI)
National Multiple Listing Service
Loopnet.com
Comparables are inspected and the transactional information is reported. Sale prices are from
public records and are typically confirmed with a party to the transaction, i.e. buyer, seller, real
estate agent, or closing attorney. All information is analyzed in processing the appraisal report
and as support for the estimated value.
The scope of work for this assignment has been described above and is to be typical for an
assignment of the nature of the subject appraisal problem.
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 7
Certification
The undersigned does hereby certify that, to the best of my knowledge and belief:
1. The statements of fact contained in this report are true and correct.
2. The reported analyses, opinions, and conclusions are limited only by the reported
assumptions and limiting conditions and are my personal, impartial, and unbiased
professional analyses, opinions, and conclusions.
3. I have no present or prospective interest in the property that is the subject of this report
and no personal interest with respect to the parties involved.
4. I have no bias with respect to the property that is the subject of this report or to the parties
involved with this assignment.
5. My engagement in this assignment was not contingent upon developing or reporting
predetermined results.
6. My compensation for completing this assignment is not contingent upon the development
or reporting of a predetermined value or direction in value that favors the cause of the
client, the amount of the value opinion, the attainment of a stipulated result, or the
occurrence of a subsequent event directly related to the intended use of this appraisal.
7. My analyses, opinions and conclusions were developed, and this report has been prepared,
in conformity with the following requirements.
Uniform Standards of Professional Appraisal Practice (USPAP)
The Code of Professional Ethics and Standards of Professional Practice of the
Appraisal Institute
The State of Florida requirements for state-certified appraisers
8. I have complied with the USPAP Competency Rule.
9. This appraisal report sets forth all of the limiting conditions imposed by the terms of this
assignment or by the undersigned affecting the analyses, opinions and conclusions
contained in this report.
10. No one provided significant real property appraisal assistance to the person signing this
certification.
11. The use of this report is subject to the requirements of the Appraisal Institute relating to
review by its duly authorized representatives. Additionally, it is subject to review by the
state of Florida relating to review by the real estate appraisal subcommittee of the Florida
Real Estate Commission.
12. As of the date of this report Lee H. Waronker, MAI, has completed the continuing
education program of the Appraisal Institute.
13. As of the date of this report, I, Carlos A. Diez, have completed the Standards and Ethics
Education Requirement of the Appraisal Institute for Associate Members.
14. I, Lee H. Waronker, have made a personal inspection of the property that is the subject of
this report.
15. I, Carlos Diaz, have made a personal inspection of the property that is the subject of this
report.
16. Neither the undersigned, nor Waronker & Rosen, Inc. have performed any valuation or
professional services involving the subject property in any capacity, nor have we been
involved with the management, leasing, disposition, nor any similar service regarding the
subject property in the past three years.
Date of Report May 31, 2013
I
Lee 1-]?` faronker, MAI, SRA
Stae Certified General Real Estate Appraiser
cense No. RZ162
Carlos Diez
State -Certified General Real Estate Appraiser
License No.RZ342o
WW'aronker & Rosen, Inc. 0 Real Estate Appraisers & C'onsullants Page 8
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 9
General Assumptions and Limiting Conditions
This appraisal report has been made with the following general assumptions:
1. No responsibility is assumed for the legal description or for matters pertaining to legal or
title considerations. Title to the property is assumed to be good and marketable unless
otherwise stated.
2. The property is appraised free and clear of any or all liens or encumbrances unless
otherwise stated.
3. Responsible ownership and competent property management are assumed.
4. The information furnished by others is believed to be reliable but, no warranty is given
for its accuracy.
5. All engineering studies are assumed to be correct. Any plot plans or illustrative material
in this report are included only to help the reader visualize the property.
6. It is assumed that there are no hidden or unapparent conditions of the property, subsoil, or
structures that render it more or less valuable. No responsibility is assumed for such
conditions or for obtaining the engineering that may be required to discover them. The
values estimated herein are subject to typical inspections such as roof, structural, and
termite, if applicable.
7. It is assumed that the property is in full compliance with all applicable federal, state and
local environmental regulations and laws unless the lack of compliance is stated,
described and considered in the appraisal.
8. It is assumed that the property conforms to all applicable zoning and use regulations and
restrictions unless a non-conformity has been identified, described and considered in the
appraisal.
9. It is assumed that all required licenses, certificates of occupancy, consents, and other
legislative or administrative authority from any local, state or national government or
private entity or organization have been or can be obtained or renewed for any use on
which the opinion of value contained in this report is based.
10. It is assumed that the use of the land and improvements is confined within the boundaries
or property lines of the property described and considered in the appraisal.
11. Unless otherwise stated in this report, the existence of hazardous materials, which may or
may not be present on the property, was not observed by the appraiser. The appraiser has
no knowledge of the existence of such materials on or in the property. The appraiser,
however, is not qualified to detect such substances. The presences of substances such as
asbestos, ureaformaldehyde foam insulation or other potentially hazardous materials may
affect the value of the property. The value estimated is predicated on the assumption that
there is no such material on or in the property that would cause a loss in value. No
responsibility is assumed for any such conditions, or for any expertise or engineering
knowledge required to discover them. The intended user is urged to retain an expert in
this field, if desired.
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 10
12. The physical condition of the improvements, if any, described herein was based on visual
inspection. No liability is assumed for the soundness of structural members, since no
engineering tests were made of same.
13. Neither all nor any part of this appraisal report shall be disseminated to the general public
using the appraiser’s name or appraisal designation, without prior written consent of the
appraisers signing this appraisal report.
14. Authorization is not allowed for the out-of-context quoting from, or partial reprinting of,
this appraisal report.
15. By reason of the report, there is no requirement to testify with reference to the property
herein appraised, unless arrangements have been previously made.
16. The reader should be advised that our employment was not contingent on the appraisal
providing a minimum valuation, a specific calculation or the approval of a loan.
Additionally, we have complied with the USPAP Competency Rule.
Limiting Conditions:
1. The allocation of total value between land and improvements applies only under the
described utilization. The separate valuations for land and improvements must not be
used in conjunction with any other appraisal and are invalid if so used.
2. The Americans with Disability Act (ADA) became effective January 26, 1992. The
appraiser has not made a specific compliance survey and analysis of this property to
determine whether or not it is in conformity with the various detailed requirements of the
requirements of the ADA. It is possible that a compliance survey of the property and a
detailed analyses of the requirements of the ADA, could reveal that the property is not in
compliance with one or more of the act. If so, this fact could have a negative impact upon
the value of the property. Since the appraiser has no direct evidence relating to this issue,
possible noncompliance with the requirements of ADA was not considered in estimating
the value of the property.
Introduction Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 11
INTRODUCTION
Introduction Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 12
Summary of Pertinent Data
Location: West side of Crandon Boulevard, just north of
Harbor Drive, Key Biscayne, FL
Address: 12 & 24 Crandon Boulevard
Key Biscayne, FL33149
Type of Use: Vacant commercial land
Zoning: C-1, Low Intensity Commercial District by the
city of Key Biscayne, FL
Census Tract: 46.02
Flood Zone: AE (Map12086C0483L)
Land Area: 62,075 square feet (1.43 acres)
Land Value: $11,000,000 ($177 per sq. ft.)
Value by Cost Approach: Not applicable
Value by Income Capitalization Approach: Not applicable
Value by Sales Comparison Approach: $11,000,000
As Is market value estimate of
the fee simple interest: $11,000,000
Date of Inspection: April 30, 2013
Date of Valuation: April 30, 2013
Date of Report: May 31, 2013
Introduction Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 13
Dade County Map
Introduction Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 14
Plat Map
Introduction Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 15
Aerial Photograph
Note: the approximate boundary of the subject property is shown in yellow outline in the aerial photograph above.
Proposed Site Plan
Introduction Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 16
The following aerial photographs show the individual parcel boundaries.
Parcel boundaries for Folio # 24-4232-002-0020
(the Kayjo parcel)
Parcel boundaries for Folio #s 24-4232-002-0021 and 24-4232-002-0030
(the Samoro parcel)
Introduction Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 17
Subject Photographs
Northeast portion of site (looking northwest toward Kayjo parcel
from curb cut on Crandon Boulevard)
Southeast portion of site (looking northwest from southeast corner
of Stefano’s parcel)
Introduction Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 18
Interior of site – parking area between Kayjo
parcel (on left) and Stefano’s parcel (on
right), looking east
Interior of site looking southwest from near
the middle of the site. Opening toward
adjoining property at rear of photo toward
right is existing cross-access point to
adjoining retail center.
Egress lane from adjoining retail center
(ingress lane on left), looking north. Cross-
access point to subject property is at rear of
photo to the right.
Street view: Harbor Drive looking east from
south side of adjoining retail center.
Intersection at rear of photo is Crandon
Boulevard. Subject property is to the left of
(north of) properties at left and rear of photo.
Introduction Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 19
Street view: Harbor Drive looking west from
south side of adjoining retail center.
Street view: Crandon Boulevard looking south
(subject property on right)
Street view: Crandon Boulevard looking north
(subject property on left)
Introduction Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 20
Appraiser Qualifications
LEE H. WARONKER, MAI, SRA
Education: Master of Science in Management, School of Business and Organizational
Science, Florida International University, 1981 (Major – Real Estate)
Bachelor of Science Degree, The Florida State University, Tallahassee, Florida
1976 (Major – Real Estate)
Affiliations: MAI Designation (No. 6738) awarded by the Appraisal Institute in 1983.
SRA (SRPA) Designation awarded by the Appraisal Institute in 1981.
State-certified general real estate appraiser, State of Florida, RZ#162, May
1990.
Registered Real Estate Broker, State of Florida, License #BK0152877 (1978)
Experience: Appraised various types of properties, including:
Industrial Buildings Restaurants Warehouses
Office Buildings Hotels and Motels Hospitals
Service Stations Retail Stores Marinas
Churches & Synagogues U.S. Post Offices Historical Buildings
Residences Condominiums Special Purpose Properties
President, Waronker & Rosen, Inc., (formerly Waronker & Associates, Inc.)
Miami, Florida, from 1987 to present. Vice President, Property Consultants,
Inc. from 1979 to 1986. Appraiser, The Keyes Company, 1978 to 1979.
Appraiser, Miami-Dade County Department of Right-of-Way, 1977 to 1978.
Instructor: Appraisal Institute. Taught Courses 1A-1, 1A-2, 8-2, 1B-A, 1B-B, 110, 120,
210, 310, 320, 410, 420, 430, 510, 550, 600, 610 and 620, et al
Author: Seminars entitled “Dynamics of Office Building Valuation”, “Why the
Capitalization Rate is Always 10” and the “Appraisal of Real Estate 10th vs.
11th Edition”.
Other: Special Master for the Dade County Valuation Adjustment Board, 1989 to
1996. Assisted in the editing of The Appraisal of Real Estate, 11th Edition and
13th Edition.
President of the Miami Chapter of the Appraisal Institute, 1990 to 1991.
Introduction Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 21
Appraiser Qualifications
CARLOS A. DIEZ
______________________________________________________________________
Education: University of Florida (Gainesville, FL)
Bachelor of Arts. Major: Economics
Stevens Institute of Technology (Hoboken, NJ)
Substantial progress towards the degree of Master of Engineering
Affiliations: State-certified general real estate appraiser, State of Florida, RZ3420
The Appraisal Institute, Candidate for Designation
CCIM Institute, Candidate Member
Appraisal Experience: Waronker & Rosen, Inc. September, 2007 to Present
Appraised a wide variety of property types, including:
Vacant land Office buildings
Restaurants Shopping centers
Hotels Free-standing retail properties
Industrial properties Apartment buildings
Residential and Commercial Condominiums Condominium Units
Land leases (leased fee and leasehold interests) Fractured Condominium Interests
Easements (including aerial and sub-surface) Special Purpose Properties
Appraisal, Investment Analysis and General Real Estate Education:
The Appraisal Institute
100, 101: Basic Appraisal Principles and Procedures
202: Residential Sales Comparison and Income Approaches
300: Real Estate Finance, Statistics and Valuation Modeling
400: General Market Analysis and Highest & Best Use
402: General Appraiser Site Valuation and Cost Approach
403, 404: General Appraiser Income Approach (Parts 1 and 2)
405: General Appraiser Report Writing and Case Studies
420: Business Practices and Ethics
510: Advanced Income Capitalization
550: Advanced Applications
530: Advanced Sales Comparison and Cost Approaches
Seminar: Hotel Appraising – New Techniques for Today’s Uncertain Times
500: Advanced Market Analysis and Highest & Best Use
833: Fundamentals of Separating Real Property, Personal Property, and Intangible Business
Assets
CCIM Institute
CI 101: Financial Analysis for Commercial Investment Real Estate
CI 102: Market Analysis for Commercial Investment Real Estate
CI 103: User Decision Analysis for Commercial Investment Real Estate
CI 104: Investment Analysis for Commercial Investment Real Estate
FANSC: Feasibility Analysis for Retail Properties
MIMK: Advanced Market Analysis for Commercial Real Estate
Baruch College (CUNY) / Steven L. Newman Real Estate Institute
NCP2000: Urban Land Economics
NCP9000: Real Estate Development
Introduction Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 22
Partial Client List
LENDER
Amerasia Bank
Apollo Bank
BAC Bank
Bank of America
Bank of Coral Gables
Bank Leumi
BNY Mellon Bank
Branch Banking and Trust (BB&T)
Broward Bank of Commerce
C1 Bank
CNL Bank
Capital Bank
Cigna Investments, Inc.
Citibank and Citicorp
City National Bank of Florida
Coconut Grove Bank
Comerica Bank
Credit Suisse First Boston Mortgage
Capital, LLC
Enterprise Bank of Florida
Espirito Santo Bank of Florida
Executive National Bank
Fifth Third Bank
First Bank of Miami
First National Bank of South Miami
FirstBank Florida
Florida Community Bank
Gibraltar Private Bank and Trust
Great Florida Bank
HSBC Bank, N.A.
Holliday Fenoglio Fowler, LP
International Finance Bank
Israel Discount Bank of New York
JP Morgan Chase Bank
Lloyds Int’l. Bank (Lloyds of
London)
Lutheran Brotherhood
Marine Bank
Marquis Bank
Morgan Stanley Mortgage Capital
Northern Trust Bank
Ocean Bank
Optimum Bank
Popular Community Bank
Professional Bank
Regions Bank
Sabadell United Bank
Space Coast Credit Union
SunTrust Bank
Terrabank, N.A.
TD Bank, N.A.
Totalbank
U.S. Century Bank
Wells Fargo Bank
Western Bank – Puerto Rico
Zions Bank
LIFE INSURANCE COMPANIES
Allstate Insurance Company
American General Life Insurance Co.
Fortis Capital Corp. & Life Insurance
Company
Franklin Life Insurance Company
General American Life Insurance Co.
Independent Order of Foresters
John Alden Life Insurance Company
Kansas City Life Insurance Company
Lumberman's Life Insurance Company
Omaha Woodmen Life Insurance
Society
Standard Life Insurance Company
Sun Life Insurance Co. of America
CORPORATIONS
Church of Jesus Christ of the
Latter-Day Saints
Florida Power and Light Corp. (FPL)
JC Penny Corporation
Wendy’s International Corporation
Chevron U.S.A., Inc.
Johnson and Johnson Company
DEVELOPERS AND INVESTORS
Berkowitz Development Group
Bristol Group, Inc.
Franklin Street Properties
Flagler Development Corporation
Goldman Properties
Hampshire Real Estate Companies
Lennar Corporation
MDM Development, Inc.
Napolitano Realty and Harnap Corp.
Noble House Resorts and Hotels
Ocean Properties, Ltd.
Panther Real Estate
PLC Investments, LLC
R.K. Associates, Inc.
The Scott Robins Companies
Wometco Enterprises, Inc.
GOVERNMENT AGENCIES
Broward County School Board
City of Coral Gables
City of Miami Beach
City of Miami General Services
Administration
Federal Deposit Insurance Corp. (FDIC)
Federal Home Loan Mortgage Corp.
(FHLMC)
Florida Dept. of Environmental
Protection
Florida Department of Transportation
Florida Keys Aqueduct Authority
Miami-Dade Water and Sewer
Authority
Miami-Dade Co. -Aviation Authority
Miami-Dade Co. - County Attorney’s
Office
Miami-Dade Co. - General Services Admin.
Miami-Dade Co. - Housing & Urban Dev.
Miami-Dade Co. - Public Works Dept.
Miami-Dade Co. - School Board
Nature Conservancy, Florida Chapter
South Florida Water Management District
United States Department of Justice
United Stated General Services
Administration
United States Postal Services
Village of Pinecrest
LAW FIRMS
Akerman, Senterfitt & Eidson
Barranco and Kircher, P.A.
Berman, Wolfe Rennart Vogel &
Mandler, P.A.
Colson Hicks Eidson, P.A.
Greenberg Traurig, P.A.
Gunster Yoakley Valdes-Fauli &
Stewart, P.A.
Holland & Knight
Kirkpatrick and Lockhart
Shutts & Bowen, LLP
Stearns, Weaver, Miller, Weissler,
Alhadeff & Sitterson, P.A.
Steel Hector and Davis
Tabas, Freedman, Soloff, Brown, &
Rigali, P.A
Tripp Scott
Introduction Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 23
Notable Properties Appraised
Miami-Dade County
Miami Seaquarium Virginia Key Miami Free Zone – Global Trade Cntr Miami
Miami International Airport Miami Metropolitan Hospital of Miami Miami
City of Miami Correctional Facility Miami Spinnaker Marina North Miami
Country Club of Miami Golf Course Miami Virginia Key & Rickenbacker Marinas Key Biscayne
Mel Reese Golf Course Miami Waterways Yacht Basin Miami
Burger King Headquarters – Waterford Miami Porto Vita Club and Spa Aventura
Doctors Hospital Coral Gables Ocean Steps Entertainment Center S. Miami Beach
Beacon Centre Development Miami Indian Creek Country Club Indian Creek
FBI Headquarters Miami BIV Tower Miami
Gables Waterway Executive Center Coral Gables Courthouse Tower Miami
Joe’s Stone Crab restaurant Miami Beach South Shore Hospital Miami Beach
Doral Ocean Beach Resort (formerly) Miami Beach SouthCom Headquarters Miami
Metro-Dade Bus Facility Miami
Fort Lauderdale/Broward County
Florida Medical Center (Hospital) Ft. Lauderdale
Jackson Marine Center Ft. Lauderdale
Las Olas Centre Office Building Ft. Lauderdale
Martha's Restaurant Hollywood
Various Luxury Single Family Homes Fort Lauderdale
Seneca Industrial Park Pembroke Park
Monroe County/Florida Keys
Marriott Key Largo Bay Beach Resort Key Largo
Islander Resort Islamorada
Hawk's Cay Resort, Marina and DRI Duck Key
Westin, formerly Hilton Resort and Sunset Key Island Key West
Little Palm Island Little Torch Key
Louis' Backyard Restaurant Key West
Ocean Key Resort Key West
Sloppy Joe's Bar Key West
Truman Annex - Navy Base Key West
Other Florida Counties
Jupiter Beach Resort Jupiter, Palm Beach County
La Playa Beach Resort Naples, Collier County
Sheraton Four Points Orlando, Orange County
Spring Hill Suites Tampa, Hillsborough County
Hilton Carillon Park St. Petersburg, Pinellas County
Outside of the United States
Various Single Family Homes Cat Cay, Bahamas
Single Family Home Casa de Campo, Dominican Republic
Sapphire Beach Resort St. Thomas, U.S. Virgin Islands
Hotel Site Grand Turks and Caicos Islands
Montego Beach Resort Montego Bay, Jamaica
Botany Bay Subdivision (400 acres) St. Thomas, U.S. Virgin Islands
Ocean Club Resort Grand Turks and Caicos Islands
Land lease under Ritz Carlton San Juan, Puerto Rico
Various Land Holdings St. Croix, U.S. Virgin Islands
Vacant Land West End, Grand Bahama Island
Buccaneer Hotel and Golf Course St. Croix, U.S. Virgin Islands
Description & Analyses Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 24
DESCRIPTION &
ANALYSES
Description & Analyses Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 25
Purpose of the Appraisal
The purpose of this appraisal is to estimate the As Is market value of the fee simple interest as of
April 30, 2013. The term fee simple interest is defined below and the term market value is
defined on the following page.
Client, Intended User and Use of the Appraisal
The intended user of this appraisal is Mitchell Burnstein, Esq. of Weiss Serota Helfman Pastoriza
& Boniske, P.A. (client), as the attorney for the Village of Key Biscayne. The intended use of
this appraisal is for decision making relating to a possible acquisition of the subject property
through eminent domain proceedings. No additional intended users are identified or intended.
Definition of Real Property Interest Appraised
The real property interest appraised herein is that of the fee, defined as follows:
Fee Simple Interest: an absolute fee without limitations to any particular class of heirs,
but subject to the limitations of eminent domain, escheat, police power and taxation. An
inheritable estate.
Description & Analyses Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 26
Definition of Market Value
Market Value is the major focus of most real property appraisal assignments. Both economic and
legal definitions of market value have been developed and refined.1 The Uniform Standards of
Professional Appraisal Practice (USPAP) states Market Value is “a type of value, stated as an
opinion, that presumes the transfer of property (i.e., a right of ownership or a bundle of such
rights), as of a certain date, under specific conditions set forth in the definition of the term
identified by the appraiser as applicable in the appraisal”.2 This requires the appraiser to identify
the definition of market value and its authority. The definition that follows is the basis of the
valuation in this appraisal and the source is the Federal Register.
Market Value is defined as “the most probable price which a property should bring in a
competitive and open market under all conditions requisite to a fair sale, the buyer and seller
each acting prudently and knowledgeably, and assuming the price is not affected by undue
stimulus. Implicit in this definition are the consummation of a sale as of a specified date and the
passing of title from seller to buyer under conditions whereby:
Buyer and seller are typically motivated;
Both parties are well informed or well advised, and acting in what they consider their
own best interests;
A reasonable time is allowed for exposure in the open market;
Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements
comparable thereto; and
The price represents the normal consideration for the property sold unaffected by special
or creative financing or sales concessions granted by anyone associated with the sale.”3
This market value definition is referenced within the appraisal regulations of the following
governmental agencies;
Title XI of the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA)
of 1989
Department of the Treasury
The Federal Reserve System (FRS)
Federal Deposit Insurance Corporation (FDIC)
Office of Thrift Supervision (OTS)
Office of Comptroller of the Currency (OCC)
1Appraisal of Real Estate, 13th Edition, page 22
2 USPAP 2012-2013, page U-4
3Federal Register/Vol. 75, No. 237/December 10, 2010
Description & Analyses Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
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Location and Address
The subject property is located on the west side of Crandon Boulevard, just north of Harbor
Drive, in Key Biscayne, FL.
Address: 12 & 24 Crandon Boulevard
Key Biscayne, FL33149
Owner of Record
Folio # 24-4232-002-0020 (the Kayjo parcel):
Kayjo, Inc. (as to a 77.5% interest)
and
Key Biscayne Gateway Partners, Ltd. (as to a 22.5% interest)
30 West Mashta Drive, Suite 400
Key Biscayne, FL 33149
Folio #s 24-4232-002-0021 and 24-4232-002-0030 (the Stefano’s parcel):
Key Biscayne Gateway Partners, Ltd.
30 West Mashta Drive, Suite 400
Key Biscayne, FL 33149
Source: www.miamidade.gov
Description & Analyses Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 28
History of the Subject Property
The subject property consists of two parcels. The parcel located toward the north and east of the
site (the Kayjo parcel) is owned jointly by Kayjo, Inc. and Key Biscayne Gateway Partners, Ltd.
(KBGP). The parcel located toward the south and west of the site (the Stefano’s parcel) is owned
entirely by KBGP. KBGP acquired the Stefano’s parcel from the previous owner, Samoro, LLC,
on August 23, 2011 for $4,750,000 ($98.80 per sq.ft.). This sale was recorded in the Public
Records of Miami County at Official Records Book 27800, Page 3979. This was a short sale
with the seller being financially distressed and the lender agreeing to take a loss on a higher loan
balance. Also, according to the buyer, their fully invested cost in the transaction, including all
other transaction costs, was $6,835,000 ($142.17 per sq.ft.). At that time, the Stefano’s parcel
was encumbered by an easement in favor of the Kayjo parcel for the purpose of providing
parking on the Stefano’s parcel to the occupant of the Kayjo parcel. That easement was
terminated by KBGP and Kayjo, Inc. on October 11, 2011 as part of an agreement between the
parties giving Kayjo, Inc. a stake in the ownership of the larger (combined) tract. On June 8,
2012, Kayjo, Inc. transferred a 22.5% interest in the Kayjo parcel to KBGP for $1,084,300.
According to the owner (KBGP), this amount was determined by taking the ratio of the size of
the Kayjo parcel (14,000 sq. ft.) to the size of the combined tract (62,075 sq. ft.) and applying it
to KBGP’s cost of acquiring the Stafano’s parcel. Prior to the KBGP purchase of the Stefano’s
parcel, the previous owner (Samoro, LLC) had entered into a purchase contract in January 2008
to purchase the Kayjo parcel for $3,888,780 ($277.77 per sq.ft.). The purchase contract
stipulated a $100,000 initial deposit, a $900,000 additional deposit, and the ability to pay
extension deposits to extend the contract. According to the owners, Samoro paid the initial and
additional deposits and continued paying extension deposits until 2009 when they were unable to
pay additional deposits and forfeited the contract. At the time of Samoro’s sale of the Stefano’s
parcel to KBGP, Samoro was financially distressed. That purchase was a short sale, with the
lender, Sabadell Bank, taking a loss on the balance on Samoro’s loan.
According to the owners, the subject property is not listed for sale and the owners intend to
defend against any eminent domain action.
Source: www.miamidade.gov and documents provided by the owners
Description & Analyses Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
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Legal Description
A single, consolidated legal description of the subject property was not provided. Following are
the legal descriptions included in the recorded deeds pertaining to the two segments of the
subject property.
Below is the legal description pertaining to Folio # 24-4232-002-0020 (the Kayjo parcel),
reproduced from the deed transferring partial interest from Kayjo, Inc. to Key Biscayne Gateway
Partners, Ltd., dated June 8, 2012, recorded in Official Records Book 28150, at Page 2747:
Below is the legal description pertaining to Folio #s 24-4232-002-0021 and 24-4232-002-0030
(the Samoro parcel), reproduced from the deed transferring 100% interest to the current owner,
dated August 23, 2011, recorded in Official Records Book 27800, at Page 3979:
Source: www.miamidade.gov
Description & Analyses Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 30
Site Data
The following description pertains to the combined site (including the Kayjo and Stefano’s
parcels). The subject site is trapezoidal in shape. There is frontage of approximately 296 feet
along the west side of Crandon Boulevard, a four lane asphalt paved road in good condition. Per
the public records the total area of the parcel is 62,075 square feet (1.43 acres). The subject
property is accessible from the west side of Crandon Boulevard to southbound Crandon
Boulevard traffic. Northbound Crandon Boulevard traffic must go north to a traffic circle
approximately 400 yards to turn back south. There are cross-access points along the west
perimeter of the site providing access to the adjacent property which is accessible from Harbor
Drive. It is unknown whether any cross-access agreements with the owner of the adjoining
property are in effect and this appraisal assumes there are no cross-access agreements as of the
date of value. The site is level and at approximate street grade. Utilities available to the site are:
Electric: Florida Power and Light
Telephone: AT&T
Water: Miami-Dade Water and Sewer
Sewer Disposal: Miami-Dade Water and Sewer
Zoning
The subject property is zoned C-1, Low Intensity Commercial District by the city of Key
Biscayne, FL. This district permits the development of land in a low intensity manner and uses
that provide for the sale of goods and products that are needed throughout the entire Village. The
permitted uses provide goods and services that primarily serve the residents of the Village. Main
permitted uses are offices and retail. The maximum floor area ratio (FAR) is .2 to .5 (which can
be increased slightly through bonuses) and maximum building height is three stories or 35 feet.
For a detailed listing of allowable uses and restrictions, refer to the zoning code of the Village of
Key Biscayne, FL.
Flood Zone
The subject property is located in Flood Zone AE. This identification was located on Flood
Insurance Rate Map, Community Panel No.12086C0483L, revised September 11, 2009. For
insurance purposes, a surveyor should be contacted to verify the exact zone by a flood
elevation certificate, as well as its impact on insurance. A copy of the flood zone map is
located in the addenda to this report.
Source: www.interflood.com
Description & Analyses Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 31
Real Estate Assessment and Taxes
Taxing Authority: Miami-Dade County
Assessment Year: 2012
Millage Rate: 17.3224
Folio Numbers: 24-4232-002-0020, 24-4232-002-0021, 24-4232-002-0030
The following is a summary of the assessments:
TAX ASSESSMENT
ANALYSIS
TOTAL
ASSESSMENT
SQ.FT.
SIZE*
ASSESSMENT
PER SQ.FT.
Assessed Land Value $5,529,250 62,075 $89.07
Assessed Value of Improvements 620,705 14,561 $42.63
Total Assessed Value $6,149,955 14,561 $422.36
*This is the size per the Miami County Property Appraiser’s records.
The real estate taxes are estimated as follows:
TAX CALCULATION TAXES PER SQ.FT.
Millage Rate (Millage Rate ÷1,000) 0.0173224
Times Total Assessed Value x $6,149,955 $422.36
Estimated Real Estate Taxes $106,532 $7.32
There is a 4% discount given for early (November) payment of taxes which would reduce the
estimated real estate taxes to $102,271, ($106,532 minus 4%).
Florida Statutes require assessments to be at 100% of just value (market value) with an allowable
adjustment to indicate net proceeds that would be derived from a sale. This adjustment varies
dependent on the taxing authority with the Miami County Property Appraiser’s office typically
designating in the range of 15%. Based upon the market value estimated herein the assessment is
below what is appropriate.
As per the public records there does not appear to be any back taxes due for the subject property.
The property tax assessments for 2011 were appealed and reductions were granted on all three
folios from a total assessed value of $9,520,345 to $5,302,000. The 2012 assessments have been
filed for hearing but have yet to be scheduled. The preliminary 2013 assessments are very close
to the 2012 assessments with a difference of approximately $50,000 less.
Description & Analyses Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 32
Description of the Improvements
The site is improved with two one-story retail buildings originally constructed in 1951 with a
combined adjusted area of 14,561 square feet. The rest of the site is mostly paved with asphalt
and has been used for parking to serve the tenants of the two buildings. The buildings and site
improvements are in poor to fair condition. The termination of the parking easement between the
owners of the two parcels allowed the combined site to be marketed to prospective retail tenants
on a land lease. Based on the highest and best use conclusion, the buildings and site
improvements contribute no value and would likely be demolished to make way for new
construction to suit the needs of the land lease tenant.
Description & Analyses Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 33
Neighborhood Overview
General Neighborhood Data
Location: Urban
Built Up: 80% to 90%
Growth Rate: Stable
Property Values: Slight increase
Demand/Supply: In balance
Present Land Use: Commercial
Change in Present Land Use: Not likely
Predominant Use: Commercial
Property Compatibility: Good
General Appearance of Properties: Good
Appeal to Market: Very good
Adjacent Uses
East: Residential Condominium & Educational Institution
West: Neighborhood Retail Center
South: Gas Station and Retail Building
North: County Park
Linkages Distance Access
Public Transportation: Within a few blocks Below average
Employment Centers: Seven to ten miles Average
Expressway Access: Ten to fifteen miles Below average
Miami International Airport: Ten to fifteen miles Below average
Description & Analyses Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 34
Supply and Demand
Current market conditions in Miami-Dade County are generally improving after the shocks
resulting from the recent financial crisis and recession. The significant increases in vacancy rates
experienced across most property types made development of virtually all types of real estate
financially unfeasible during much of 2010 and 2011. Demand for most property types has since
gained strength, bringing vacancy rates down to levels that have again made development
feasible in the most desirable areas, especially for property types in which vacancy rates
remained relatively low throughout the recession. First to emerge from the downturn was the
multi-family sector, though it is notable that the residential condominium market in the Brickell
area (just north of Key Biscayne on the mainland) was also among the earliest to emerge from
the distressed conditions of 2008-2010. Consistent increases in local employment levels,
international trade and consumer confidence, and the widespread signs during 2012 that the
housing sector (which was crippled by the downturn) had significantly stabilized, have bolstered
investor confidence in the near-term outlook for development, particularly of residential, retail
and hotel projects. This is abundantly evident in the Brickell area north of the subject property,
where a massive mixed-use development project known as the Brickell CitiCentre project is
projected to deliver upward of five million square feet of new inventory in the coming years.
Sites like the subject that have a neighborhood retail orientation depend heavily on the density of
residential development and household buying power of the areas immediately surrounding it
and within a convenient distance from it. Since Key Biscayne is a small island enclave about six
miles from the mainland, with a population of about 12,000, the success of any commercial or
retail project there is more heavily influenced by the demographic and economic characteristics
of the neighborhood than by conditions on the mainland. The typical retailer considering a site
like the subject, for example, is unlikely to consider areas outside of Key Biscayne to be part of
their trade area (the area from which they would expect to draw most of their customers). On the
other hand, a business located in Key Biscayne that is able to serve the needs of local residents is
likely to capture a high share of local demand precisely because of its enclave location, which
makes competitive alternatives on the mainland much less convenient.
Addendum C contains several reports obtained using STDB, a widely used real estate market
analysis tool, that provide a demographic and economic profile of Key Biscayne (based on data
for zip code 33149). The data is provided by ESRI, a leading provider of Geographic
Information Systems (GIS) software tools and geodatabase management applications, using
source data from the Census Bureau and other sources. The Demographic and Income Profile
shows that 19.8% of Key Biscayne households have incomes above $200,000 (compared to 3.2%
for Miami-Dade County). Notably, the Net Worth Profile indicates that 35.2% of households
have a net worth above $500,000 (compared to 11.1% for Miami-Dade County). In addition, the
Housing Summary indicates that 40.8% of owner-occupied housing units are valued at over
$1,000,000.
Description & Analyses Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 35
Interestingly, the ESRI data includes a Tapestry Segmentation Profile places about 25% of local
residents in the “Top Rung” market segment, which is the wealthiest of all the segments in the
Tapestry system. ESRI describes “Top Rung” households as “mature, married, highly educated
and wealthy”. The Tapestry market segmentation system describes the characteristics of local
households in terms of socioeconomic, consumer behavior and lifestyle factors, and can be very
useful in predicting household buying behavior. It is widely used by market analysts to
determine optimal locations for specific businesses (and the businesses most likely to succeed at
specific locations). By comparison, ESRI data indicates that in Coral Gables, Coconut Grove (zip
code 33133) and Miami-Dade County, the percentage of “Top Rung” households is significantly
lower, at 20.5%, 5.3% and 1.5%, respectively. Overall, the demographic, economic and market
segmentation data describe a select, wealthy community with significant buying power.
Furthermore, the island location makes this community a potentially captive market for any
business that is able to meet its needs.
An additional and useful tool for assessing market conditions for commercial real estate locally
is the “Retail Marketplace Profile”. This study considers sales to consumers by local retail
establishments (supply) in comparison to potential purchases by local residents of goods and
services in those categories (demand). The “retail gap” is the result of subtracting supply from
demand. A positive gap represents “leakage” of potential purchases outside of the market area,
and the opportunity for a new retailer to potentially capture. A negative value represents a
surplus of supply, indicating that sales in that category exceed local demand (indicating a market
where customers are drawn from outside). Notably, the analysis indicates a positive retail gap
(i.e., leakage of sales outside of Key Biscayne) in 34 out of 41 categories, with a total retail gap
of $151,261,389 for “total retail trade and food and drink” out of a total potential demand of
$234,073,603. The analysis indicates a positive retail gap (opportunity) of $13,278,824 in the
“Health and Personal Care Stores” category, which includes the industry categories for
pharmacies, drug stores and cosmetic and beauty supply stores. This indicates that there may be
sufficient demand for a drug store such as Walgreens to succeed at the subject location.
The subject site’s prominent location on Crandon Boulevard at the entrance to Key Biscayne
makes it very well-suited for retail uses that require visibility and accessibility. It should be noted
that the small size of the municipality and the orientation of its business and commercial district
around Crandon Boulevard as its main artery means that there are very few sites that would
potentially offer comparable visibility. The site would be a very desirable location for a
prominent national retailer such as Walgreens, a bank branch, or similar types of businesses.
However, it should also be noted that retailers such as Walgreens typically seek locations that
provide convenient vehicular access from more than one side, except in dense urban locations
where the store is typically built to the sidewalk lot line and has a pedestrian customer
orientation (i.e., where pedestrian retail traffic is sufficient to support the store and minimal or no
parking is provided). The subject site is an interior site. It is directly accessible from Crandon
Boulevard only, and can only be accessed from Harbor Drive to the south if a cross-access
agreement is in place with the adjoining retail center to the west. The site plan for the proposed
Walgreens (see page 15), provided to the appraisers by the owner, indicates cross-access points
along the west side of the site connecting with the adjoining property and providing access from
Harbor Drive. Given that pedestrian retail traffic at the subject location is not likely to be heavy
Description & Analyses Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 36
enough to offset the lack of vehicular access from Harbor Drive, it seems likely that if cross-
access cannot be obtained, or if it is not permitted, the subject site would be less valuable to a
user such as Walgreens. As such, this valuation relies on the assumption that cross-access is in
place and permitted.
In summary, market conditions at present are very favorable for the subject property, as it
benefits from a very desirable, prominent location in a wealthy community with very few
potentially suitable alternative development sites. While the location’s isolation from the
mainland makes any commercial development at the subject site more heavily dependent on the
local community, it is a community with significant buying power, with a retail gap analysis
indicating a significant amount of unmet local retail demand. The constraints on the supply side
(which serve as a higher barrier to entry for potential competitors), coupled with the very
favorable outlook for local demand, would make the subject very appealing to national retailers,
and would enable the site to compete against similar sites in some of the more desirable
neighborhoods across the Miami-Dade County area, such as Coral Gables, Coconut Grove,
Brickell and Miami Beach.
Description & Analyses Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 37
Exposure Time
Exposure time is the “estimated length of time that the property interest being appraised would
have been offered on the market prior to the hypothetical consummation of a sale at market value
on the effective date of the appraisal. Exposure time is a retrospective opinion based on an
analysis of past events assuming a competitive and open market”1.
This analysis considers the exposure time at a market related price such as the estimated market
value herein. In estimating exposure time, sales are analyzed, real estate brokers and property
owners are interviewed and when available, statistics from published surveys are considered.
The exposure time for the subject is estimated at six to 12 months. This estimate considers that
the property would have been properly marketed and priced. If the property were not to have
been priced correctly or marketed through proper channels, then it is not likely that the estimated
market value nor the estimated exposure time would have been achieved.
Typical Purchaser of the Subject
The subject is a commercial parcel zoned for low-intensity commercial uses with a neighborhood
retail orientation. The typical purchaser of the subject would be a developer with experience
developing neighborhood retail projects, or an investor able to secure agreements with national
retailers to develop the site.
1Uniform Standards of Professional Appraisal Practice (USPAP) 2012-2013 Edition, Page U-3
Description & Analyses Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 38
Highest and Best Use
The site is valued for its highest and best use, which may be defined as follows:
That reasonable and probable use that will support value
as defined as of the effective date of the appraisal.
In analyzing the highest and best use, the following four questions are answered:
1. Legally Permissible. What uses are legally permitted on the subject site with
respect to zoning ordinances and deed restrictions?
2. Physically Possible. What uses of those legally allowed are physically possible
on the subject site?
3. Financially Feasible. Of those uses determined to be physically possible and
legally permissible, which ones will produce a positive return?
4. Maximally Productive. Of those that are feasible, legally permissible, and
physically possible, which will produce the highest rate of return or value?
As Vacant
The highest and best use as though vacant would be to develop the site with neighborhood retail
uses.
As Improved
The subject property is being appraised as vacant land since the improvements do not contribute
to value and therefore an analysis of the highest and best use as improved is not applicable.
Description & Analyses Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 39
Appraisal Process
An analysis of three separate approaches to value; sales comparison approach, cost approach,
and income capitalization approach, will be considered to estimate the value of the subject
property. Although these three approaches to value are considered within every appraisal report,
they may not be applicable to each and every property being appraised.
The cost approach is based on the principle of substitution which states that an informed
purchaser would not pay more for a property than the cost of reproducing a property with the
same utility. The cost approach can often yield reliable estimates of value for new construction.
This approach entails estimating the cost of producing the improvements, deducting an estimate
of depreciation, then adding the value of the site as if vacant. To this value an entrepreneurial
incentive is added to arrive at the estimated value by the cost approach.
The income capitalization approach is based on the concept that value is created by the
expectations of future benefits and higher earnings should result in higher values. Income
producing real estate is purchased for the right to receive future income. The income
capitalization approach consists of methods to analyze a property's capacity to generate income,
and a reversion, and convert these monetary benefits into an estimate of value.
The sales comparison approach is based on the principle of substitution which suggests that,
within competitive markets, similar products will realize similar prices. Inherent in this concept
is the premise that a purchaser would not pay more for a property than the cost to acquire another
property with the same amenities and utility.
The final steps in the appraisal process are review and reconciliation of the data and conclusions.
In reaching a final conclusion of value, the entire process involving the approaches that were
estimated must be reviewed for accuracy, completeness and consistency. After analysis,
evaluation and reconciliation of the indications a value is estimated. The essence of this final
reconciliation should be a defensible and rational conclusion of value.
The only approach used in this appraisal is the sales comparison approach. The income
capitalization approach and sales comparison approach are not applicable to the valuation of the
subject property.
Cost Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 40
Cost Approach
The basis of the cost approach is the principle of substitution. This principle suggests that a
prudent buyer would not pay more for a property than the cost to acquire a similar site and
construct comparable improvements.
Following are the procedures for preparing the cost approach.
1. Estimate the value of the land as though vacant and available to be developed to its highest and
best use.
2. Determine which cost basis is most applicable to the assignment: reproduction cost or
replacement cost.
3. Estimate the direct (hard) and indirect (soft) costs of the improvements as of the effective
appraisal date.
4. Estimate an appropriate entrepreneurial profit or incentive from analysis of the market.
5. Add estimated direct costs, indirect costs, and the entrepreneurial profit or incentive to arrive at
the total cost of the improvements.
6. Estimate the amount of depreciation in the structure and, if necessary, allocate it among the three
major categories: physical deterioration, functional obsolescence, and external obsolescence.
7. Deduct the estimated depreciation from the total cost of the improvements to derive an estimate
of their depreciated cost.
8. Estimate the contributory value of any site improvements that have not already been considered.
(Site improvements are often appraised at their contributory value - i.e., directly on a depreciated-
cost basis - but may be included in the overall cost calculated in Step 2 and depreciated, if
necessary).
9. Add the land value to the total depreciated cost of all the improvements to arrive at the indicated
value of the property.
10. Adjust the value conclusion if for any personal property (e.g., furniture, fixtures, and equipment)
or intangible assets are included in the appraisal assignment. If necessary this value, which
reflects the value of the fee simple interest, may be adjusted for the property interest being
appraised to arrive at the indicated value of the specified interest in the property. 1
As the subject property is being appraised as unimproved vacant land, the cost approach is not
applicable. Land value has been estimated in the sales comparison approach herein.
1The Appraisal of Real Estate, 13th Edition, 2008, Page 384 and 385
Income Capitalization Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 41
Income Capitalization Approach
Income producing real estate is typically purchased as an investment, and from an investor’s
point of view earning power is the critical element affecting property value. One basic
investment premise holds that the higher the earnings, the higher value, provided the amount of
the risk remains constant. An investor who purchases income-producing real estate is essentially
trading present dollars for the expectation of receiving future dollars. The income capitalization
approach to value consists of methods, techniques, and mathematical procedures that an
appraiser uses to analyze a property’s capacity to generate benefits (i.e., usually the monetary
benefits of income and reversion) and convert these benefits into an indication of present value.1
In the income capitalization approach, a property's capacity to generate future benefits is
analyzed and the income is capitalized into an indication of value. The principle of anticipation is
fundamental to the approach.2
Rental income can be derived from vacant land and is more typical for commercial zoned
properties. The lease by Walgreens, a copy of which was not provided to the appraisers, is based
on a proposed site plan that has not been approved. An analysis of the value based on the
potential income if cross-access is provided begins on page 59. This estimated value would set
the upper limit of value for the subject property if the site plan was approved with cross-access to
the adjacent parcel to allow access from Harbor Drive.
1 Appraisal of Real Estate, 13th Edition, 2008, Page 445
2 Ibid., 445
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 42
Sales Comparison Approach
The sales comparison approach is based on the principle of substitution. The principle of
substitution holds that the value of a property tends to be set by the price that would be paid to
acquire a substitute property of similar utility and desirability within a reasonable amount of
time.1
In the Sales Comparison Approach, an opinion of market value is developed by comparing
properties similar to the subject property that have recently sold, are listed for sale, or are
under contract (i.e., for which purchase offers and a deposit have been recently submitted). A
major premise of the sales comparison approach is that an opinion of the market value of a
property can be supported by studying the market’s reaction to comparable and competitive
properties.
Qualitative analysis is a relative comparison process without mathematics. Sales are ranked
based upon their desirability as compared to the subject. Comparisons can be expressed as
plus or minus as opposed to dollar or percentage adjustments.
Quantitative analysis is the process of applying mathematical techniques. Sales are adjusted to
the subject property on a dollar or a percentage basis. One method of supporting adjustments
is through paired data analysis. This method analyzes two sales and attributes the difference
in their sales prices to the characteristic which is different. This analysis requires an
abundance of sales data which is frequently not available.
Qualitative analysis is used herein to estimate a value by the sales comparison approach.
Characteristics of the sales considered superior to the subject are given a minus (-) adjustment.
Those characteristics of the sales considered inferior to the subject are given a plus (+)
adjustment. Each sale is given an overall adjustment indicating how it compares to the subject.
1 The Appraisal of Real Estate 13th Edition, 2008, page 298-299
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 43
Vacant Land Sales Grid
Following is a grid of the comparable properties used for comparison to the subject property. No
recent comparable sales were found in close proximity to the subject property within Key
Biscayne. The sales used have desirable and comparable locations.
Sale
No.
Sale
Date Location Zoning
Sale
Price
Sq. Ft.
Size
Price/
Sq.Ft.
1 12/2012 2524 Le Jeune Road
Coral Gables
C $4,000,000 28,164 $142.03
2 6/2012 431-451 South Miami Avenue
Miami
T6-48B-O $28,200,000 110,082 $256.17
3 6/2012 6900 Collins Avenue
Miami Beach
TC-2 $5,701,000 37,500 $152.03
4 5/2012 425 South Dixie Highway
Coral Gables
C $4,320,000 25,000 $172.80
5 4/2012 Northwest corner of South Miami
Avenue and SW 7th Street
Miami
T6-48B-O $12,450,100 49,578 $251.12
6 4/2011 799 Brickell Plaza
Miami
T6-48B-O $13,100,000 55,940 $234.18
7 2/2011 1685 Lenox Avenue
Miami Beach
CD-3 $3,300,000 16,000 $206.25
8 1/2011 2669 South Bayshore Drive
Miami
T6-12-O $24,000,000 106,286 $225.81
Subject
12 & 24 Crandon Boulevard
Key Biscayne, FL
C-1 62,075
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 44
Vacant Land Sales Map
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 45
Comparable Land Sale 1
Location
2524 Le Jeune Road
Coral Gables, FL 33134
Property Type
Vacant Commercial
Square Feet
28,164
Price/Sq.Ft.
$142.03
WAR No.
303091R
Recording Information
Sale Price: $4,000,000
Sale Date: December 2012
ORB/Page: 28404/4780
Grantor: Arc Gables, LLC
Grantee: Coral Gables Miracle Mile Hotel, LLC
Legal Description: Lots 25, 26, 27, 28, 29, 30, 31 and 32, in Block 6, of CORAL
GABLES BILTMORE SECTION, according to the Plat
thereof, as recorded in Plat Book 20, at Page 28, as recorded in
the public records of Miami-Dade County, FL
Folio No.: 03-4117-008-1120; -1111; -1135 and -1140
Financing & Prior Sale
Financing: All cash to seller
Prior Sale: June 2011 for $2,945,900
Property Description
Zoning: C, Commercial District by the city of Coral Gables, FL
Shape: Rectangular
Topography: Grade level
Comments
This sale is four adjacent parcels located at the northwest corner of the intersection of Le Jeune
Road (SW 42nd Avenue) and Valencia Avenue, just south of the Le Jeune Road intersection
with Miracle Mile in the city of Coral Gables. It is improved with a 7,546 square foot multi-
family residence constructed in 1949 and two parking lots to the west. The building
improvements are not considered to contribute any value to the site. The 2011 sale was from the
foreclosing lender.
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 46
Comparable Land Sale 2
Location
431-451 South Miami
Avenue
Miami, FL 33130
Property Type
Vacant Commercial
Square Feet
110,082
Price/Sq.Ft.
$256.17
WAR No.
303135
Recording Information
Sale Price: $28,200,000
Sale Date: June 2012
ORB/Page: 28153/1079
Grantor: Miami Retail Partners, LLC
Grantee: Miami River Holdings, LLC
Legal Description: Lengthy. Refer to recording deed.
Folio No.: 01-0210-060-1340;
01-0210-060-1350
Financing & Prior Sale
Financing: All cash to seller
Prior Sale: None in the past five years
Property Description
Zoning: T6-48B-O, Urban Core Open Transect Zone by the city of
Miami, FL
Shape: Irregular
Topography: Grade level
Comments
This is a development site located at the northeast corner of South Miami Avenue and SE 5th
Street, along the south bank of the Miami River and along the west side of the Fifth Street
Metromover station. The site is two blocks west of Brickell Avenue, and just north of Brickell
Citicentre, a massive mixed-use project that is under construction and due to be completed in
phases starting in 2015-2016. The buyer is a Colombian investor who has acquired a number of
sites in the vicinity of the CitiCentre project, but has not announced development plans. The
seller had planned a large scale mixed-use residential/retail project for the site but construction
never began. The company also sold other parcels in the area to the developer of the CitiCentre
project. This site was not widely marketed for sale.
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 47
Comparable Land Sale 3
Location
6900 Collins Avenue
Miami Beach, FL 33141
Property Type
Vacant Commercial
Square Feet
37,500
Price/Sq.Ft.
$152.03
WAR No.
303144
Recording Information
Sale Price: $5,701,000
Sale Date: June 2012
ORB/Page: 28214/3396
Grantor: SDPG 6900 LLC
Grantee: Bayrock Investment Co. - Collins Ave. Exchange, LLC
Legal Description: Lots 4 through 9, Block D of CORRECTED PLAT OF
ATLANTIC HEIGHTS, as recorded in Plat Book 9, Page 14,
as recorded in the public records of Miami-Dade County, FL
Folio No.: 02-3211-001-0220;
02-3211-001-0230;
02-3211-001-0240
Financing & Prior Sale
Financing: All cash to seller
Prior Sale: None in the past five years
Property Description
Zoning: TC-2, North Beach Town Center Mixed Use District by the
city of Miami Beach, FL
Shape: Rectangular
Topography: Grade level
Comments
This parcel is located at the northwest corner of Collins Avenue and 69th Street. The parcels
across Collins Avenue to the east are oceanfront parcels. It is improved with a one-story building
that was formerly a Denny's restaurant, but has been vacant for some time. The seller purchased
the site in 2011 from a distressed developer that was unsuccessful with a plan to build a mixed-
use residential/retail project on the site.
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 48
Comparable Land Sale 4
Location
425 South Dixie Highway
Coral Gables, FL 33146
Property Type
Vacant Commercial
Square Feet
25,000
Price/Sq.Ft.
$172.80
WAR No.
303009R
Recording Information
Sale Price: $4,320,000
Sale Date: May 2012
ORB/Page: 28135/1044
Grantor: WLPW1, LLC
Grantee: Holiday Diver, Inc.
Legal Description: Beginning at a point 207.3 feet Southwest of the Northeast
corner of Block 36A; thence run Southwest for a distance of
250.0 feet; thence run Northwest for a distance of 100.0 feet to
the Point of Beginning, CORAL GABLES RIVIERA
SECTION 2 REVISED, recorded in the public records of
Miami-Dade County, FL
Folio No.: 03-4120-023-0520
Financing & Prior Sale
Financing: All cash to seller
Prior Sale: None in the past five years
Property Description
Zoning: C, Commercial District by the city of Coral Gables, FL
Shape: Rectangular
Topography: Grade level
Comments
This is a rectangular parcel located along the northwest side of South Dixie Highway (US 1), just
southwest of the intersection at South LeJeune Road (SW 42nd Avenue). At the time of the sale,
it was improved with a free-standing one-story 9,100 square foot industrial type retail building
that had for many years been owner-occupied by Poe's Hardware, a hardware rental shop that,
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 49
with the sale of the property, closed for business at that location. The site has 250 feet of frontage
along South Dixie Highway with no northbound South Dixie Highway direct access. Although
the buyer intends to occupy the building, most of the value is considered to be in the land. Based
on its age and condition, the value of the building is estimated in the range of $40 to $60 per
square foot. At $50 per square foot, the contributory value of the building would be $455,000,
which would imply a land value (as though vacant) of $3,865,000, or $154.60 per square foot.
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 50
Comparable Land Sale 5
Location
Northwest corner of South
Miami Avenue and SW 7th
Street
Miami, FL 33130
Property Type
Vacant Commercial
Square Feet
49,578
Price/Sq.Ft.
$251.12
WAR No.
302937R
Recording Information
Sale Price: $12,450,100
Sale Date: April 2012
ORB/Page: 28088/1522 (Parcel A); 28088/1566 (Parcel B); 28088/1600
(Parcel C) and 28088/1636 (Parcel D)
Grantor: Michael P. Latterner, Patrick Gleber and Fred M. Rawicz, as a
majority of the co-Trustees of the Rust Trust (Parcels A & B);
South Miami Properties, Ltd. (Parcel C); Tobacco Road, Inc.
(Parcel D)
Grantee: Tobacco Road Property Holdings, LLC
Legal Description: Lengthy. Refer to recording deed.
Folio No.: 01-0205-030-1110, -1120, -1130, -1140, -1150, -1160, -1170
and -1180
Financing & Prior Sale
Financing: All cash to seller
Prior Sale: None in the past five years
Property Description
Zoning: T6-48B-O, Urban Core Open Transect Zone by the city of
Miami, FL
Shape: Irregular
Topography: Grade level
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 51
Comments
This is the sale of eight contiguous lots from three related entities to a single buyer on the same
date. The combined, nearly rectangular site has a total of approximately 700 feet frontage along
South Miami Avenue, SW 7th Street and SW 1st Avenue (labeled incorrectly in the plat map as
S. Miami Ave.). It lies immediately north and west of the site of the Brickell CitiCentre project, a
9-acre mixed-use development announced in 2011 by Swire Properties. The buyer intends to
redevelop the site or sell to a developer in about five years. One of the parcels (at the northeast
corner of the site) is the site of Tobacco Road, well-known as Miami's oldest bar (opened in
1912). According to the broker, the buyer signed a new lease with Tobacco Road allowing them
to stay for three years with two 1-year options, at a net rental rate of $120,000 per year. The
adjoining parcels to the south are also improved with similar older one- and two-story buildings
occupied by ground floor retail tenants. The broker could not confirm lease details for the other
buildings, which have an estimated rentable area of approximately 9,700 sq. ft. An estimated
average net market rent of $30 (considering that a portion is second story space), and an
allowance for vacancy, collection and other losses of 15%, would put the projected net income
for these additional buildings at approximately $250,000 per year. Demolition costs at the end of
the five years are estimated at $5 per sq. ft. of building, or $50,000. The combined $370,000 per
year, projected to be received for five years, less the projected demolition cost would have a
present value of approximately $1,450,000, applying a discount rate of 8%. If the purchase price
were adjusted to reflect the value of this additional income (which would not be received by a
buyer purchasing a similar vacant parcel), the adjusted purchase price of $11,000,100 would
represent a cost of $222 per sq. ft. for the land.
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 52
Comparable Land Sale 6
Location
799 Brickell Plaza
Miami, FL 33131
Property Type
Vacant Commercial
Square Feet
55,940
Price/Sq.Ft.
$234.18
WAR No.
302933R
Recording Information
Sale Price: $13,100,000
Sale Date: April 2011
ORB/Page: 27663/2817
Grantor: Eastern National Holdings, Inc.
Grantee: Brickell Citicentre Plaza, LLC
Legal Description: Lengthy. Refer to recording deed.
Folio No.: 01-0210-030-1250 and -1230
Financing & Prior Sale
Financing: All cash to seller
Prior Sale: None in the past five years
Property Description
Zoning: T6-48B-O, Urban Core Open Transect Zone by the city of
Miami, FL
Shape: Irregular
Topography: Grade level
Comments
This is the purchase of two adjacent parcels comprising double corners on Brickell Plaza and
both SE 7th and 8th Streets, adjacent to the 8th Street Metromover Station. The purchase is part
of an assemblage. The site is improved with a nine-story, 86,100 sq. ft. office building and a
109,000 sq. ft. parking garage. The office building was owner-occupied by Eastern National
Bank, which remained in occupancy as a tenant under a sale leaseback agreement. The term of
the seller's tenancy is unknown. The buyer is Swire Properties, Ltd., a Hong Kong-based
developer that has announced plans for Brickell CitiCentre, a 2.8 million sq. ft. mixed-use
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 53
project comprising retail, office, lodging and residential components, and spanning four city
blocks. As of May 2012, Swire had acquired two other tracts: a 246,573 sq. ft. tract comprising
two blocks directly to the west, purchased in October 2008 for $41,300,000 ($167.50 per sq. ft.);
and a 93,482 sq. ft. tract directly to the northwest, purchased in March 2011 for $14,000,000
($149.76 per sq. ft.). According to a Swire news release, the project is to be completed in two
phases, with the first phase (which includes all elements except one office tower) scheduled for
completion in 2015, followed by a final office tower in 2018. It is unknown whether this
improved tract is dedicated to the first or second phase.
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 54
Comparable Land Sale 7
Location
1685 Lenox Avenue
Miami Beach, FL 33139
Property Type
Vacant Commercial
Square Feet
16,000
Price/Sq.Ft.
$206.25
WAR No.
302903R
Recording Information
Sale Price: $3,300,000
Sale Date: February 2011
ORB/Page: 27585/3421
Grantor: Tara Realty, LLC
Grantee: Mac Alton, LLC
Legal Description: Lots 14 and 15, Block 38, of PALM VIEW SUBDIVISION,
according to the Plat thereof, as recorded in Plat Book 6, Page
29, as recorded in the public records of Miami-Dade County,
FL
Folio No.: 02-3234-004-0780 and -0790
Verification:
Financing & Prior Sale
Financing: All cash to seller
Prior Sale: None in the past five years
Property Description
Zoning: CD-3, Commercial High Intensity District by the city of Miami
Beach, FL
Shape: Rectangular
Topography: Grade level
Comments
This parcel is located on the southeast corner of 17th Street and Lenox Avenue, just north of
Lincoln Road in the city of Miami Beach. This is the sale of two adjoining parcels with older
apartment buildings which was purchased for redevelopment with approximately 36,000 square
feet of retail proposed for completion by mid-2013.
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 55
Comparable Land Sale 8
Location
2669 South Bayshore Drive
Miami, FL 33132
Property Type
Vacant Residential
Square Feet
106,286
Price/Sq.Ft.
$225.81
WAR No.
303113R
Recording Information
Sale Price: $24,000,000
Sale Date: January 2011
ORB/Page: 27742/2353
Grantor: NCG Coconut Grove Hotel, LLC
Grantee: Terra Grove Communities, LLC
Legal Description: Lengthy. Refer to recording deed.
Folio No.: 01-4122-001-1500
Financing & Prior Sale
Financing: All cash to seller
Prior Sale: None in the past five years
Property Description
Zoning: T6-12-O, Urban Core Zone by the city of Miami, FL
Shape: Irregular
Topography: Grade level
Comments
This is a site having two street frontages in the Coconut Grove section of the city of Miami. It
fronts both South Bayshore Drive and SW 27th Avenue. It is the former Grand Bay hotel
property with the hotel closing several years ago and fallen into disrepair. The 14-story hotel was
constructed in 1982 and shared access with the adjacent Grand Bay condominium office building
which is still in place. The property was purchased while in foreclosure by a well-known
developer who originally planned to develop two rental towers of 200 units each. The market
subsequently has improved and luxury residences in this area are very desirable with extensive
bay views in the Dinner Key Marina area. Planned are two towers of 50 units each. The units
would have extensive bay views with prices ranging from $2 to $6 million.
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 56
Adjustment Grid
Below is a grid which illustrates qualitative adjustments used to compare the comparable sales to
the subject property. Percentage adjustments were not utilized. In order to utilize percentage
adjustments it would be necessary to pair (compare) sales to extract value differences. This is
difficult as there is normally insufficient data to provide pairings for all value differences. Below
is a grid which illustrates the adjustments made. A plus (+) sign indicates the unit of comparison
of the sale must be adjusted upward as that characteristic is inferior to the subject. A minus (–)
sign indicates the unit of comparison of the sale must be adjusted downward since the
characteristic is superior to the subject. An equal (=) sign indicates the comparable sale
characteristic is similar to the subject.
Sale
No.
Price/
Sq. Ft
Market
Condi-
tions
Condi-
tions of
Sale
Loca-
tion Zoning
Size/
Shape Access Other
Overall
Adjustment
1 $142.03 + = + + - = / = - = +
2 $256.17 + = - - - - - = / = - = - - - -
3 $152.03 + = + = = / = - = +
4 $172.80 + = + - = / + = - +
5 $251.12 + = - - - - - = / + - - - - - -
6 $234.18 + + - - - - - - = / = - - - - - -
7 $206.25 + + = - - - - / = - = - -
8 $225.81 + + + - - - - - - +/= - = - - -
After considering the individual differences, either a plus (+), minus (–) or equal (=) sign has
been placed in the "Overall" column. This indicates the overall adjustment that the sale would
require as compared to the subject property.
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 57
Conclusion of Value by the Sales Comparison Approach
The sales comparison approach compared similar properties to the subject property and
adjustments were made for the pertinent characteristics. Based on these comparisons a value was
estimated for the subject property.
Note that all the sales except Sale No. 4 require negative adjustments for access, based on the
assumption that cross-access providing access from Harbor Drive is not in place, making the
subject inferior in this regard to all the sales with corner exposure or frontage on two streets.
Note also that adjustments for market conditions take into consideration improvement in market
conditions occurring since mid-2012, with the older sales occurring in 2011 requiring a larger
adjustment due to even weaker market conditions. Also, adjustments for zoning consider both
the allowable density and intensity of development, and the range of allowable uses. Note that
the subject zoning does not allow residential uses. Zoning that is otherwise similar but does
allow residential uses is generally superior in this regard, especially where density and height
limits allow for development of a large number of upper-floor residential units, which can
significantly enhance the profitability of a project and raise the feasibility land cost (the
maximum land cost at which a project can be financially feasible).
Sale No. 1 ($142.03 per sq.ft.) requires a positive adjustment for an inferior location, but a slight
negative adjustment for superior zoning. Overall, a positive adjustment is indicated.
Sale No. 2 ($256.17 per sq.ft.) requires negative adjustments for location and zoning. Overall, a
large negative adjustment is indicated.
Sale No. 3 ($152.03 per sq.ft.) requires a positive adjustment for location, indicating a positive
adjustment overall.
Sale No. 4 ($172.80 per sq.ft.) requires a positive adjustment for location and for a relatively
narrow and less desirable shape, and a slight negative adjustment for superior zoning. It also
requires a negative adjustment for the contributory value of existing improvements. Overall, a
positive adjustment is indicated.
Sale No. 5 ($251.12 per sq.ft.) requires a positive adjustment for shape, but negative adjustments
for location and zoning. A negative adjustment is also indicated for the contributory value of
interim rental income. Overall, a large negative adjustment is indicated.
Sale No. 6 ($234.18 per sq.ft.) requires negative adjustments for conditions of sale (the buyer
was assembling numerous parcels in the area as part of a massive development project and it is
likely they paid above market for the site), location and zoning. A negative adjustment is also
indicated for the contributory value of interim rental income from the seller who remained as a
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 58
tenant during the holding period before development of the site is to commence. Overall, a
negative adjustment is indicated.
Sale No. 7 ($206.25 per sq.ft.) requires negative adjustments for location, zoning and for it
smaller size (which tends to be associated with a higher price per square foot). Overall, a slight
negative adjustment is indicated.
Sale No.8 ($225.81 per sq.ft.) requires a positive adjustment for market conditions, conditions of
sale (it was a distressed asset purchased out of foreclosure) and shape, and negative adjustments
for location and zoning. Overall, a large negative adjustment is indicated.
Analysis of the required adjustments indicates that the subject property would be likely to
achieve a sales price per square foot above Sale Nos. 1, 3 and 4 (a range of $142.03 to $172.80)
and below Sale Nos. 2, 5, 6, 7 and 8 (a range of $206.25 to $256.17). These indications would
support a value estimate in the high $100s per square foot. A value of $175 per square foot is
estimated. Based on the land area of 62,075 square feet, this equates to a value of $11,000,000
(rounded)
Note: The value indication above is an As Is value, based on the current situation assuming no
cross-access agreement (providing access to the site from Harbor Drive through the adjacent
property). If such an agreement were in place and permitted, the analysis indicates that the value
of the subject property would be higher. This analysis, based on proposed ground leases that are
based on cross-access being in place, begins on the following page.
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 59
Analysis of Proposed Ground Leases
The owner stated to the appraisers that a fully executed land lease to Walgreens is in place. He
briefly showed the appraisers a document indicating a signature page, stating that it was the fully
executed lease, though he did not provide the appraisers with a copy of the agreement. He did
provide basic information regarding rent and terms. When the appraisers asked the owner
whether the agreement was conditional upon a cross-access agreement with the adjoining site, he
did not provide an answer, and referred the appraisers instead to the Village to discuss the status
of approvals for the proposed project. This analysis relies on the assumption that the Walgreens
lease is in fact executed, and that it is conditional upon having a cross-access agreement in place
with the adjoining property (which would allow the tenant to be accessible from Harbor Drive).
According to the owner, the lease stipulates a 60-year term with the option to cancel at certain
intervals, an initial rent (absolute net to the landowner) of $530,000 per year, with 10% rent
escalations every 10 years. The site plan for the proposed Walgreens store indicates a 14,558 sq.
ft. free-standing retail building located toward the northeast portion of the site. The site plan
describes a future free-standing building located at the southeast corner of the site, which would
presumably share the parking area with the Walgreens store but which would not be part of the
Walgreens land lease.
The owner provided a copy of a letter of intent from J.P. Morgan Chase dated September 2011
proposing a land lease of approximately 40% of the overall site, acknowledging that the overall
site would contain two tenants, and including an agreement to work together with the other
tenant to obtain necessary approvals for development of the site. The terms of the letter state that
there will be easements in place protecting access and circulation within the site, a as well as a
cross-access agreement in place with the adjacent property to the west. It stipulates a base term
of 20 years with four 5-year renewal options, rent of $384,000 per year during the first five years
of the original term, with 10% increases every five years during the original term and 12%
increases every five years during the renewal term. The proposed use was for a Chase bank retail
branch with one drive-through lane. According to the owner, negotiations with Chase were
terminated “in great part due to the Village threat of Eminent Domain and other tortious
interference with this business deal”, but he intends to seek another land lease agreement with
another tenant on similar terms.
The site plan submitted by the owner includes the proposed Walgreens and parking throughout
the site (i.e., for both buildings), but not the second building that was conceived as the Chase
branch, as a result of the termination of the Chase deal. The site plan submitted indicates a total
of 57 parking spaces (including three ADA spaces and two golf carts). Considering only the
Walgreens store, this equates to a parking ratio of one space per 255 square feet (3.9 per 1,000
sq. ft.). The land-to-building ratio considering only the Walgreens building is 4.26:1. With the
addition of a second building, the parking ratio would be reduced. Based on the site plan, the
“future building area” appears to be in the range of 7,000 to 8,000 square feet. At 7,500 square
feet, it would reduce the overall parking ratio to one space per 387 square foot (2.58 per 1,000
sq. ft.), and the land-to-building ratio to 2.81. These ratios would be below the range for typical
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 60
Walgreens stores and bank branches (see the summary of comparable ground leases that
follows), which raises a question about whether the Walgreens lease may contain provisions
restricting the intensity of the use to be developed on the south portion of the site, and also
whether two relatively parking-intensive uses can in fact be achieved on the site simultaneously
(at least at the building sizes indicated by the proposed site plan). Note that the Chase letter of
intent was first submitted in 2011. It is unknown when the Chase offer was rescinded, when
Walgreens lease was signed (the plans were submitted in April 2013), or whether the Walgreens
offer would have been modified if the Chase deal was still in play. These factors would justify
using some caution in estimating a total potential rental income combining the Walgreens and
Chase leases. However, both leases are relevant indications of the potential achievable land rent
(conditional, of course, upon approval, and upon the existence of critical cross-access
agreements with the adjoining property).
Assuming that a new tenant can be secured for the south portion of the site on terms similar to
the Chase offer (and with the Walgreens lease in place), then the Walgreens lease and the Chase
letter of intent indicate that an annual net land rent of $914,000 is achievable. Applying a
market-derived capitalization rate to this potential net annual income would provide an
indication of land value for the subject property, assuming the rents from the leases were in
place. Since the rents are not in place, and since approvals have not been granted, the As Is value
of the subject property would reflect the risk involved in acquiring the property in its current
state, obtaining the necessary approvals and securing a new tenant for the south portion of the
site (as well as mutual agreement between Walgreens and the new tenant).
On the following page is a table summarizing a number of recent sales of land leased parcels.
Included are Walgreens and CVS leases, and two parcels leased to BankUnited. Note that the
Walgreens site at 501 Collins Avenue is the only location among the eight considered that does
not have ingress and egress from two sides, but it should be noted that this is a street retail
property in a highly pedestrian-oriented area in South Beach, benefits from heavy pedestrian
traffic (mostly tourists). The capitalization rates range from 4.16% to 7.21%, with the average
and median near 6%. These sales indicate that capitalization rates in the range of 5% to 7%
should be achievable for the subject site with land leases in place (i.e., producing income) along
the lines of the proposed Walgreens lease and now-rescinded offer from Chase.
Following the table of land lease sales is a grid reproduced from a recent RealtyRates investor
survey of land leases.
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 61
Comparable Sales of Ground Leases
Tenant / Location
Sale
Date Sale Price
Land
Area
Land Rent
per SF
Rentable
Building
Area
Land /
Building
Ratio
Year
Built
Cap
Rate Comments
Walgreens
15050 Biscayne Blvd.
North Miami
3/13 $11,000,000 46,494 $14.08 14,550 3.20
(3.85*)
2010 5.95% Interior location on west side of Biscayne Blvd., with easement over adjacent 9,574 sq. ft.
tract owned by City of North Miami Beach providing additional ingress and egress from
NE 151st St. Lease expires 3/20, with one 15-year option and four 10-year options. Deal
required assumption of existing non-recourse loan with a loan balance of $6.8M, a 5.76%
interest rate, 30-yr amortization and a balloon payment of $5.8M on 12/20.
Walgreens
14190 SW 26 St
Miami
2/13 $3,975,000 65,160 $4.14 15,120 4.31 2002 6.79% Corner location at SW 26th St (Coral Way) and SW 142nd Ave. Ingress & egress from
both streets. Lease is net, but owner responsible for roof & structure. Cap rate reflects
$.15 allowance for reserves
BankUnited
12290 Biscayne Blvd.
North Miami
12/12 $4,650,000 29,089 $8.94 3,683 7.90 1970/
2012
5.59% Corner location at Biscayne Blvd. and NE 123rd St. Ingress & egress from both streets.
15-yr lease commenced 6/12 with four 5-yr options. 10% rent increases every 5 yrs
during original and option terms. Tenant to spend $1M in improvements.
BankUnited
1695 Alton Road
Miami Beach
12/12 $8,150,000 15,000 $22.60 4,940 3.04 1928/
2012
4.16% Corner location at Alton Rd. and 17th St., one block north of Lincoln Rd. Ingress from
both streets, egress onto Alton Rd. Historic freestanding retail building completely
renovated for use as bank branch (tenant spent $2.5M in improvements).
Walgreens
501 Collins Avenue
Miami Beach
11/12 $30,000,000 15,093 $105.35 22,857 .66 1995 5.30% Corner location at Collins Avenue and 5th Street, one block west of Ocean Drive. Two-
story store built full to lot line. No parking – pedestrian access only. 25-year lease signed
in 2008.
CVS
2391 W 68th Street
Hialeah
9/12 $3,650,000 58,868 $3.63 12,025 4.90 2002 5.85% Corner location at W 68th St and W 24th Ave. Ingress & egress from both streets.
CVS
14705 SW 42nd Street
Miami
10/11 $3,975,000 68,808 $4.17 11,986 5.74 2001 7.21% Corner location at Bird Rd. and SW 147th Ave. Ingress & egress from both streets. Cross-
access with adjacent retail center.
Walgreens
9020 Biscayne Blvd.
Miami Shores
1/12 $2,900,000 46,494 $4.35 14,850 3.13 1996 6.97% Corner location with three street frontages along Biscayne Blvd., NE 90th St. and NE 6th
Ave. Ingress and egress from Biscayne Blvd. and NE 90th St., egress for drive-thru lane
onto NE 6th Ave.
Subject Site 62,075
*Including land area of easement tract
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 62
Below is a table and accompanying narrative on recent land lease capitalization rates taken from
the RealtyRates Investor Survey.
The investor survey indicates an average capitalization rate for all properties of 7.1%. Generally,
capitalization rates associated with higher-risk uses tend to be higher, with lower-risk, more
stable uses achieving below-average rates.
Based on the desirable attributes of the subject property and the very favorable market conditions
noted previously, the investor survey and the analysis of the comparable sales of land leases
indicate that subject is likely to achieve a capitalization rate in the range of 5% to 7% once the
approvals are obtained and leases like those under consideration are secured. A capitalization
rate of 6.0% is estimated.
Assuming that net income of $914,000 per year is in place (based on the proposed Walgreens at
$530,000 and the previous offer from Chase at $384,000), a capitalization rate of 6.0% would
equate to a land value of roughly $15,000,000, rounded ($242 per sq. ft.). Again, these values are
Sales Comparison Approach Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 63
predicated on land leases with tenants having similar credit as Walgreens and J.P. Morgan Chase
generating actual net rent of $914,000 per year being in place. These rents would equate to a
total net annual rent of $14.72 per square foot, which is similar to that of the most recent
Walgreens lease at 15050 Biscayne Boulevard shown in the ground lease grid. The As Is value,
as noted, reflects the risk inherent in taking the property from its current state, securing the leases
and obtaining the necessary approvals. In this context, the value estimate of $11,000,000 is
reasonable. It represents a 27% discount ($15,000,000 vs. $11,000,000) from the potential value
implied by the hypothetical situation with cross-access agreement permitted and in place, the
Walgreens and Chase tenants in place and paying rent, and all approvals having been obtained.
This is along the lines of profit margins typically expected and achieved by real estate investors
purchasing properties in similar situations with potential tenants lined up. Note that the above
analysis indicates that the As Is value is lower than what it would be if the proposed site plan
allowing cross-easements was approved.
Based on the analysis, the As Is value of the fee simple interest as of April 30, 2013 is estimated
at $11,000,000.
Reconciliation Commercial Land, 12 & 24 Crandon Boulevard, Key Biscayne, FL 33149
Waronker & Rosen, Inc. Real Estate Appraisers & Consultants Page 64
Reconciliation of Value
The reconciliation process considers the approaches which were utilized in this report. Each
approach to value is analyzed as to its reliability and applicability. These approaches indicated
the following values:
Cost Approach Not applicable
Income Capitalization Approach Not applicable
Sales Comparison Approach $11,000,000
The cost approach estimates the land value and adds the depreciated value of the improvements.
As the land being appraised is unimproved, this approach does not apply. Vacant land value was
estimated in the sales comparison approach.
The income capitalization approach analyses the projected income and expenses of a property
and capitalizes the net income into a value estimate. Income capitalization techniques were
employed in an analysis of proposed land leases and a potential land value if cross-access with
the adjacent property were permitted.
The sales comparison approach compares sales of similar properties to the subject property and
is the only applicable approach to value. These sales were analyzed for differences such as
conditions of sale, financing, market conditions, location, zoning, shape/size, and other
characteristics. The strength of this approach relies on the quality of the comparable sales. Sales
which closely resemble and can be compared easily with the subject are most desirable. The
sales utilized were considered comparable and make the sales comparison approach the only
reliable indication of value.
As the subject property is being appraised as vacant land total reliance was placed on the sales
comparison approach. As a result of the analysis, the As Is market value of the fee simple
interest of the subject property as of April 30, 2013 is estimated at $11,000,000.
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ADDENDA
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ADDENDUM A
COUNTY AREA DESCRIPTION
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Miami-Dade County and Area Description
General Overview
Miami-Dade County is at the southeastern tip of Florida and is the south-easternmost state in the
continental United States. With land area of approximately 1,946 square miles, it is the most
populous county in the state and is often referred to as Greater Miami, in combination with its
most populous city, Miami. It is bordered on the north by Broward County, on the west and
south by Collier and Monroe Counties, respectively, with the east side bordered by the Atlantic
Ocean.
Within the county's borders are two national parks (Everglades and Biscayne National), 15 state
water conservation and wildlife management areas, four state parks, 135 area-wide parks and
571 local parks, totaling 727 park and recreations areas.
Demographics
The early 1960's marked the beginning of the arrival of large numbers of Cuban Refugees into
Miami-Dade County and South Florida which has transformed Miami into having a Latin flavor.
In the years following, have come significant numbers of immigrants from Haiti, Cuba and other
Latin American countries.
Miami-Dade County increased 10.8% in population from 2000 (2.3 million) to 2010 (2.5
million). The current 2012 census estimate shows Miami-Dade County with a population of
2,551,290 as of April 2012, an increase of 2.2% from 2010. This is similar to trends throughout
Florida.
Miami-Dade County Population Projections
2015 Projection
based on 2011
Estimate
Percentage change
2011 to 2015
2020 Projection
based on 2011
Estimate
Percentage change
2011 to 2020
2,591,790 3.8% 2,717,631 4.9%
Source: MiamiHerald.com and http://EDR.state.fl.us
The largest city in Miami-Dade County is the city of Miami with 414,741 residents estimated as
of April 2012. The second largest city, Hialeah reflects 227,395 as of April 2012. Actively
growing are some new cities since 2000 such as Cutler Bay and Doral and Miami Gardens. The
primary industries that support Miami-Dade County’s economy through employment are trade,
transportation and utilities, followed by education/health services and government. The most
known is tourism, a major industry for Miami-Dade County.
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Ports of Entry
PortMiami is the world’s leading port for cruise line passenger traffic, while also showing
impressive strength in international freight. The port’s biggest ocean freight trading partner is
China, and vice versa. The port is Florida’s No. 1 container port with three terminals. It also
contributes over $17 billion annually to the local South Florida economy, providing direct and
indirect employment of over 176,000 jobs. As part of the growing environmental concerns, the
port has implemented procedures that integrate pollution prevention and waste reduction. An
agreement signed with the Panama Canal Authority in October 2011 promotes new business
growth via the all water route between Asia and North America's East Coast via the expanded
Panama Canal. A 2035 Master Plan visualizes an array of projects that support significant
expansion of both cruise and cargo operations by optimizing land usage of the 518-acre site.
In 2014, PortMiami will be one of only three East Coast Ports with 50 feet of depth able to
accommodate the new larger cargo vessels that will pass through the expanded Panama Canal.
This will increase intermodal and distribution networks with strategic partners. PortMiami is
among America's busiest ports and recognized across the globe with the dual distinction of being
the Cruise Capital of the World and the Cargo Gateway of the Americas. The port contributes
more than $18 billion annually to the South Florida economy and helps provide direct and
indirect employment for more than 180,000. The U.S. Department of Commerce has approved
PortMiami as a Foreign Trade Zone which aims to help create jobs and international trade. It
stretches from north of SW 8th Street to the Broward County line. One of four in Miami-Dade
County, the port plans to establish satellite zones allowing individual companies to have the
benefits of a FTZ at their own secure warehouse.
Freight-handling is being streamlined nationally and internationally.
Deepening PortMiami to 52 feet begins in 2013, with the goal of making PortMiami
more attractive to shipping companies after the Panama Canal expansion is completed
in 2014.
The opening in early 2014 of a two-way underwater tunnel between PortMiami and
downtown Miami to carry cargo trucks and traffic
A train track linking Miami to existing tracks connecting to Jacksonville in early 2014,
where cargo will be transferred to points all over the county.
Approximately six miles to the northwest of PortMiami is Miami International Airport (MIA).
MIA is considered to be the driving force for growth behind its surrounding area along with the
linkages. Passenger traffic for the 2012 was 39.5 million passengers, up more than 1.1 million
passengers from 2011. In 2012, international passengers jumped 5.2% to 19.4 million passengers
and domestic passengers increased 1% to 20.1 million from 2011. More than 2.1 million tons of
cargo passed through the airport. As reported by their website, MIA and the General Aviation
Airports in Miami-Dade County annual economic impact is $26.7 billion. MIA and related
aviation industries contribute 282,043 jobs directly and indirectly to the local economy. That
equates to one out of 4.1 jobs. Located on 3,230 acres of land, MIA's terminal is being expanded
to more than seven million square feet through a capital improvement program scheduled for
final completion in 2013.
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Economic Base
A year-round growing season allows the agricultural industry to be the top vegetable supplier
and producer in the country. In Florida, Miami-Dade County is second in three aspects: foliage
nurseries, nursery production and aquaculture which includes ornamental fish and fish for
consumption. The industry employs more than 20,000 people and produces more than $2.7
billion in economic impact each year. Combining the area’s attributes with tourism has led to
agri-tourism, locations throughout the agricultural area that visitors can sample and purchase
locally grown products. The climate is considered Subtropical Marine with an annual average
temperature of approximately 77 degrees, a 70% probability of sunshine and an approximate
average annual precipitation of 79 inches. Average elevation is 12 feet. Its semi-tropical location
and very suitable climate allow for year round outdoor activity.
In recent years, like most other parts of the country, Miami-Dade County has seen a significant
decline in the housing market and the chart on the next page reflects these issues are considered
to continue into the near future.
Existing Single-Family Home Sales Housing
Percent Change in Homes Sold
2005-2006
2006-2007
2007-2008
2008-2009
2009-2010
2010-2011
Percent Change in Median Sale Price
2005-2006
2006-2007
2007-2008
2008-2009
2009-2010
2010-2011
-21.1%
-39.2%
-17.2%
52.7%
9.3%
35.7
7.0%
1.1%
-27.2%
-29.4%
-3.0%
-8.8%
Units Permitted
2005
% change from 2004 to 2005
2006
% change from 2005 to 2006
2007
% change from 2006 to 2007
2008
% change from 2007 to 2008
2009
% change from 2008 to 2009
2010
% change from 2009 to 2010
2011
% change from 2020 to 2011
26,120
14.3%
20,017
-23.4%
8,082
-59.6%
3,474
-57.0%
1,395
-59.8%
3,203
129.6%
2,618
-18.3%
Source: www.edr.state.fl.us
Sports
Professional, college and even local neighborhood sports draw spectators, participants and
investors to a high degree and create a positive atmosphere. Professional football (Miami
Dolphins), basketball (Miami Heat), baseball (Miami Marlins) and ice hockey (Florida Panthers)
are continual draws. There are two horse tracks and a dog track. Several of these tracks have
been approved for slot gambling or table gambling, depending upon location in a municipality or
Indian reservation. Also offered are golf, tennis, as well as the numerous water sports, given the
significant bodies of water.
The Orange Bowl Stadium was the home of the University of Miami Hurricanes. The stadium
has recently been demolished and constructed is a new stadium for the Miami Marlins baseball
team
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Linkages
Transportation systems include a Busway in south Miami-Dade County linking to Metrorail, an
elevated rail rapid transit system connecting portions of Miami-Dade County. In July 2012, a
new Metrorail station in Miami International Airport (MIA) links south Miami-Dade County,
downtown Miami and the entire elevated rail line. The enables seamless connections that connect
to the Metromover systems and add to a web of transportation arteries in neighboring counties
leading to the rest of Florida.
The Metromover automated people mover system is located in downtown Miami and is an off-
shoot of the Metrorail system. There are also Metrobus buses, most of which are in service daily
throughout the county. The Metromover system includes the Brickell Avenue financial district
and also runs north to the Omni area. Other transportation services in Miami-Dade County
include Tri-Rail, railroads and taxicabs. Railroad service by Amtrak is accessible in northwest
Miami-Dade. Tri-Rail is South Florida's commuter train system which services Miami-Dade,
Broward and Palm Beach Counties.
In the construction stage and nearing completion is the Miami Intermodal Center (MIC), which
will link the airport, East/West Rail (companion project), Amtrack, Tri-Rail, Airport/Seaport
Connector and Metrorail mainline rail. Located near the State Road No. 836/State Road 112
Connector, just east of the airport will be parking, retail, commercial, residential and tourist-
designed development.
Within Miami-Dade County, major roads include the Palmetto Expressway (State Road No.
826), a major north/south expressway, the Dolphin Expressway (State Road No. 836), a major
east/west expressway, Interstate No. 95 and the Florida Turnpike. All of these represent Miami's
expressway network and make almost any destination in Miami-Dade County within 30 to 45
minutes driving time.
Government
Within Miami-Dade County there are 36 individual municipal jurisdictions with the largest
jurisdiction being the unincorporated area. Miami-Dade County has a strong mayor form of
government, with nine elected individuals (one mayor and eight commissioners) making up the
Miami-Dade County Board of Commissioners. The mayor appoints a professional administrator
to manage the daily activities of the county government and a county attorney to handle its legal
matters. Its largest municipality, Miami, is comprised of a nonvoting executive mayor elected
citywide and five commissioners from five districts.
Some governmental activities, services and functions previously handled by individual
municipalities are now handled by the county. Among these are real property assessment and
valuation, health and welfare, most water and sewers, traffic engineering, public libraries, public
transportation, public housing, urban renewal, seaport, airport, regional parks and air and water
pollution control. In addition to these, Miami-Dade County provides services to the
unincorporated areas of the county such as: police and fire protection, building and zoning
regulation, trash and garbage collection and disposal, parks and recreation, consumer protection
and corrections and rehabilitation of adults and youth offenders.
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Education
Miami-Dade's education system is governed by an elected 7-member board who in turn appoints
a superintendent whose responsibility is to manage the daily activities of the school system.
Based upon student population, the Miami-Dade County School system is the fourth largest
school system in the nation. Several colleges and universities are located in the county, including
Barry University, Florida International University, Miami-Dade Community College, St.
Thomas University, Florida Memorial College and Johnson & Wales University. Many private
institutions at each academic level exist as alternative choices for the public.
Medical
Miami-Dade County has the largest concentration of medical facilities in Florida. The largest
institution is Jackson Memorial Medical Center, the second largest public hospital in the nation
which shares many teaching, treatment and research capacities with the University of Miami.
Arts and Culture
Known for the wealth of ethnic diversity and heritage, Miami-Dade County has a cultural mix of
festivals, concerts, theater and dance performances. A state-of-the art complex, Adrienne Arsht
for the Performing Arts of Miami-Dade County, Inc., opened in late 2006. Five companies
occupy the two buildings: The Concert Association of Florida, Florida Grand Opera, Florida
Philharmonic Orchestra, Miami City Ballet and the New World Symphony. The complex
contains an opera house, symphony hall, flexible space studio theater, outdoor performance
space, tower, two restaurants, banquet hall, education center and commissioned artwork.
Adjacent parking is available.
Summary
During its history, Miami-Dade County and the Greater Miami area have experienced significant
changes and growth. Trends indicate that the growth will continue, albeit at a much lower pace
into the future.
The diverse economic base and the bilingual population should continue to attract new residents
and businesses into the Greater Miami/Miami-Dade County area.
Sources various websites including, but not limited to,
www.greatermiami.com/gmcc/about (Greater Miami Chamber of Commerce)
Rev. 4/13
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ADDENDUM B
FLOOD ZONE MAP
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Flood Zone Map
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ADDENDUM C
MARKET ANALYSIS REPORTS
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