Change in Miami code allows downtown development without on-site parking
By Paola Iuspa
Plans to bring hundreds of new residences to the downtown Miami business district are moving forward as city officials make concessions to attract development and residents.
Rafael Kapustin, who owns land in the district, is getting the kind of changes in city code that he says will benefit development. Beginning this month, developers may build residential and commercial buildings in the central business district without providing on-site parking.
The ordinance, effective last week, allows developers to contract with private or public parking operators to provide the parking needed for future tenants or buyers. Before the law was changed, the city required commercial and residential projects to offer parking at the building. Mr. Kapustin was one of many who pushed for the change.
"This change was a key element for the development of K Place," he said, referring to his proposed five-building complex planned east of Northeast Second Avenue between First and Third streets. He hopes to reach an agreement with a developer this month to build the first of five 25-story buildings at about $25 million each.
Because he and the developer won't have to build parking on the site, they say they will save at least $15,000 per unit, a saving he said he plans to pass on to buyers. That is the average cost of building a parking space at a garage, he said. Construction could begin in a year.
"Our goal is to sell the units for as low as possible," Mr. Kapustin said. "They could start below $150,000."
He is currently negotiating an agreement with the Miami Parking Authority, a semi-independent agency that manages city-owned garages, said Arthur Noriega, authority executive director. He said the contract calls for Mr. Kapustin to use 250 spots at the city's garage at Northwest Third Street and Miami Avenue for his first building, a few blocks from the proposed site.
"There is a limit to it," Mr. Noriega said, referring to the authority's capacity to lease space for future projects. "Some of our other garages are adjacent to buildings and are already full."
Kapustin Corp. is currently converting an obsolete office building into the first market-rate residential condominium in the business district. The 90-unit Flagler First Condominium, 101 E Flagler St., could set a trend that seems to be backed by local elected officials, eager to attract people to live downtown and help expand the city's tax base and resuscitate businesses.
Many see it too risky to be one of the first to build market-rate condos or rental units because they have no comparison to existing properties to determine the demand or what buyers are willing to pay.
In an effort to reduce the risk factor, commissioners this week approved waiving the impact fees for three unspecified developments of market-rate middle income housing in the downtown area. The first three developers that apply and qualify will get the waiver.
"If you are not lined up, you may not get the it," Miami Commission Johnny Winton said Tuesday.
Commissioners also gave a preliminary OK at a proposal to grant tax abatement to new commercial buildings, including rental buildings, and expansion of existing ones in downtown, Allapattah, Wynwood, Edison, Overtown, East Little Havana, Little Haiti and along the Miami River. The item will need to come back to the commission for final approval.
While voters approved granting the abatement in November 2001, the city commission needs to endorse the legislation.
"It is going to be a tremendous help," said Beatriz Cuenca-Barberio, executive director of the Downtown Community Development Corp., a nonprofit that assists developers with information on available funds, puts them in touch with elected officials and helps them get permits fast tracked. "It will bring housing for the middle-income professional household."