Château Group is getting an $800,000 reduction in fines accrued at a downtown Miami development site where a tenant operated an illegal parking lot.
The Miami City Commission voted on Thursday to slash $1.1 million in daily accrued fines to $300,000 stemming from a former tenant at 666 Biscayne Boulevard operating a parking lot without a certificate of use from the city. An affiliate of Hallandale Beach-based Château, led by Manuel and Sergio Grosskopf, owns 666 Biscayne Boulevard and two adjacent lots at 728 Biscayne Boulevard and 225 Northeast 7th Street where the developer previously planned a mixed-use project.
In March, the Château affiliate sued the city of Miami in Miami-Dade Circuit Court, alleging it had no knowledge of the violation and did not receive proper notice about a code enforcement hearing in 2011, the complaint states. The affiliate also alleges that city officials allowed its former tenant, Ultra Park Miami 600, to continue operating the illegal parking lot for another 13 years without notifying the property owner about the accruing $250 daily fines.
Château doesn’t have any immediate plans to develop the site at 666 Biscayne Boulevard and the two other lots, Manuel Grosskopf told The Real Deal. He was forced to take legal action against the city, Grosskopf added.
“This is a normal course of action you have to take,” Grosskopf said. “This was caused by a tenant that was evicted.”
The Château affiliate sued Ultra Park in January to kick the parking lot operator off the property, court records show. The Château affiliate won a final judgment in February and retook possession of the site at 666 Biscayne Boulevard, which is adjacent to Freedom Tower at Miami-Dade College, a national historic landmark that once served as the first stop for Cuban migrants in the 1960s.
During the city commission’s Thursday meeting, Château attorney Richard Bergman tried to get a bigger reduction in fines, requesting that his client be allowed to only pay 5 to 10 percent of the $1.1 million. He noted that Miami code enforcement officials waited until Jan. 18 of this year to issue Ultra Park with a cease-and-desist order.
“That would have stopped the operation of the parking lot years ago,” Bergman said. “[Including the other two properties,] my client pays over $1 million in annual property taxes. This property is not making $300,000 a year. You want to punish my client.”
However, Miami elected officials voted to give Château a nearly 75 percent discount. “We are being very, very lenient with them,” Commissioner Joe Carollo said. “There are no clean hands here. Three hundred thousand is more than fair, and your client should be thankful that is all we charged.”
Château is also partnering with Edgardo Defortuna’s Fortune International Group to develop the St. Regis Residences in Sunny Isles Beach, a two-tower project with 350 condos. Recently, the joint venture increased an $119 million construction loan for the project by $100 million.