Miami White Pager[1]

Published on March 2017 | Categories: Documents | Downloads: 29 | Comments: 0 | Views: 142
of 6
Download PDF   Embed   Report

Comments

Content

SCOPE
 AND
 POSSIBLE
 EFFECTS
 OF
 THE
 FEDERAL
 AVIATION
 ADMINISTRATION’S
 (FAA)
 ONE
 ENGINE
  INOPERATIVE
 POLICY
 
 

  SUMMARY
 OF
 THE
 OEI
 POLICY
 CHANGE
 
  The
  FAA
  proposed
  One
  Engine
  Inoperative
  (OEI)
  policy
  has
  not
  formally
  been
  proposed
  or
  defined,
  but
  based
  on
  information
  from
  aviation
  experts,
  it
  is
  our
  understanding
  that
  the
  FAA
  is
  considering
  revising
 its
 criteria
 for
 evaluating
 whether
 proposed
 structures
 (e.g.
 buildings,
 towers,
 wind
 farms),
  would
 pose
 a
 hazard
 to
 air
 navigation.
 
  Based
 on
 available
 information,
 it
 will
 likely
 protect
 for
 airline-­‐specific
 OEI
 procedures
 surrounding
  airports.
 
 These
 airline-­‐specific
 procedures
 are
 often
 at
 heights
 well
 below
 the
 current
 criteria
 used
  to
  evaluate
  structures,
  and
  may
  effectively
  limit
  the
  heights
  of
  proposed
  construction
  to
  levels
  lower
 than
 are
 presently
 considered
 not
 to
 pose
 hazards
 to
 air
 navigation.
 
  As
  an
  example
  of
  the
  potential
  change,
  consider
  a
  structure
  aligned
  with
  an
  airport
  runway
  centerline,
  and
  situated
  10,000
  feet
  from
  the
  end
  of
  the
  runway.
 
  Under
  the
  current
  evaluation
  criteria,
 the
 structure
 would
 be
 allowable
 at
 a
 height
 of
 250
 feet
 above
 ground
 level.
 
 A
 proposed
  change
  to
  the
  criteria
  taking
  into
  consideration
  OEI
  procedures
  would
  effectively
  limit
  the
  same
  structure
  to
  just
  160
  feet.
 
  For
  an
  occupiable
  building,
  this
  could
  equate
  to
  approximately
  nine
  floors
 constituting
 the
 obstruction
 under
 the
 new
 OEI
 determination
 criteria.
 
  The
  effect
  of
  the
  OEI
  change
  would
  be
  that
  the
  economic
  responsibility
  to
  provide
  for
  sufficient
  flight
  clearances
  would
  be
  shifted
  from
  the
  airlines,
  where
  it
  has
  been
  since
  the
  FAA
  began
  evaluating
  hazards
  to
  air
  navigation
  over
  seventy
  years
  ago,
  to
  individual
  property
  owners.
  Proposed
 construction
 exceeding
 these
 new
 criteria
 would
 receive
 FAA
 determinations
 of
 hazard,
  which
  may
  impact
  the
  ability
  to
  obtain
  financing,
  insurance,
  necessary
  permits,
  and
  comply
  with
  local
 zoning
 requirements.
 
 
  While
 not
 likely
 to
 be
 applied
 retroactively,
 the
 policy
 would
 likely
 apply
 to
 any
 future
 development
  of
 projects
 on
 sites
 with
 existing
 FAA
 determinations
 of
 no
 hazard.
 
 When
 local
 entitlement
 agencies
  adopt
 the
 FAA’s
 advisory
 opinions
 of
 “hazard”
 or
 “no
 hazard,”
 the
 result
 may
 be
 a
 “downzoning”
 of
 a
  development
 site
 or
 a
 building,
 limiting
 a
 property’s
 development
 potential
 and
 value.
 
  In
 summary,
 the
 proposed
 change
 to
 the
 FAA’s
 policy
 related
 to
 the
 determination
 of
 hazard
 or
 no
  hazard
  has
  expansive
  ramifications
  throughout
  real
  estate
  development
  and
  investment,
  public-­‐ private
  partnership
  initiatives,
  and
  the
  feasibility
  of
  operating
  affected
  existing
  properties
  in
  the
  long-­‐term.
 
 
 
  There
  are
  real
  valuation
  concerns
  that
  property
  owners
  should
  have
  relative
  to
  this
  potential
  change,
  and
  it
  is
  our
  opinion
  that
  the
  effects
  of
  the
  proposed
  change
  are
  not
  yet
  well
  understood
  by
  the
  real
  estate
  community.
  For
  the
  developers
  and
  investors
  in
  prospective
  projects,
  the
  current
  uncertainty
  of
  development
  density
  causes
  expensive
  delays
  and
  inhibits
  new
  investment
  in
  real
  estate
  projects
  that
  are
  often
  good
  for
  the
  community
  and
  that
  offer
  solid
  contributions
  to
  local
  economic
 development.
 
 
 
 
 
 
 
 

IMPACTS
 OF
 THE
 OEI
 POLICY
 CHANGE
 
  1. The
  prospective
  change
  is
  incredibly
  far-­‐reaching,
  affecting
  privately
  and
  publicly
  owned
  real
 estate
 near
 388
 different
 airports
 throughout
 the
 United
 States
 and
 U.S.
 Territories.
 
 
  2. The
  change
  affects
  primarily
  proposed
  and,
  to
  a
  lesser
  extent,
  existing
  structures,
  which
  are
  often
  located
  within
  or
  near
  central
  business
  districts,
  airports,
  and
  sub-­‐markets
  of
  major
  American
  cities
  that
  are
  important
  economic
  centers
  for
  the
  metropolitan
  area,
  as
  well
  as
  the
 nation.
 
  a. Locations
 like
 Washington,
 D.C.
 suburbs
 in
 Northern
 Virginia,
 Chicago’s
 West
 Loop
  and
  Near
  Northwest
  Suburbs,
  Downtown
  Boston,
  Lower
  Manhattan,
  and
  the
  Downtown
 and
 Brickell
 areas
 of
 Miami
 would
 all
 be
 affected.
 
 
  2. Overall,
  more
  than
  3,850
  existing
  structures
  would
  exceed
  the
  surfaces
  of
  the
  proposed
  OEI
  policy,
 meaning
 that
 they
 fall
 outside
 of
 allowable
 redevelopment
 limitations.
 
 
  a. While
 their
 existing
 use
 would
 not
 be
 affected
 by
 the
 policy
 change,
 these
 structures
  may
 not
 be
 able
 to
 be
 rebuilt
 to
 the
 same
 height
 or
 scale
 under
 the
 proposed
 policy
  should
 substantial
 reconstruction
 or
 redevelopment
 be
 required.
 
 
  3. The
  structures
  affected
  include
  office
  buildings,
  residential
  towers
  and
  single-­‐family
  homes,
  hotels,
  bridges,
  lighthouses,
  utility
  and
  communications
  towers,
  and
  other
  types
  of
  structures.
 
 
  a. Many
 of
 these
 properties
 have
 iconic
 and
 cultural
 significance
 to
 their
 cities
 and
 to
  the
 nation,
 beyond
 their
 real
 estate
 value
 or
 public
 utility.
 
  4. Limiting
  density
  in
  the
  areas
  affected
  by
  the
  policy
  change
  has
  the
  effect
  of
  pushing
  development
  outward,
  encouraging
  sprawl,
  and
  limiting
  the
  amount
  of
  space
  available
  in
  core
 employment,
 residential,
 and
 tourism
 areas.
 
 
  5. The
 impact
 of
 the
 potential
 policy
 change
 is
 most
 significant,
 and
 more
 readily
 determined,
  for
 projects
 that
 are
 proposed
 for
 development.
 
 
  a. The
  FAA’s
  formal
  determinations
  of
  “no
  hazard”
  expire
  after
  18
  months
  if
  construction
  on
  a
  project
  has
  not
  yet
  begun.
 
  If
  a
  proposed
  development
  has
  received
  a
  determination
  of
  “no
  hazard,”
  the
  developer
  has
  18
  months
  to
  begin
  construction,
  which
  in
  recent
  years
  has
  been
  difficult
  due
  to
  the
  challenging
  atmosphere
  for
  capital
  investment
  and
  financing,
  and
  further
  complicated
  by
  foreclosure
  proceedings
  and
  litigation
  related
  to
  property
  proposed
  for
  development.
 
 
  b. Should
 delays
 to
 the
 start
 of
 construction
 occur,
 a
 developer
 must
 seek
 an
 extension
  after
  the
  initial
  18-­‐month
  period
  has
  expired.
 
  The
  FAA
  evaluates
  the
  extension
  request
 under
 the
 facts
 and
 circumstances
 existing
 at
 the
 time,
 taking
 into
 account
  current
 criteria
 and
 air
 traffic
 procedures.
 
 
  c. Under
  the
  new
  criteria,
  a
  project
  that
  had
  previously
  received
  a
  determination
  of
  “no
  hazard”
  could
  now
  receive
  a
  hazard
  determination
  upon
  request
  for
  the
  extension
 if
 its
 proposed
 height
 exceeded
 the
 OEI
 criteria.
 
  6. The
  change
  would
  result
  in
  limits
  being
  placed
  on
  the
  density
  of
  new
  prospective
  development
 in
 the
 land
 areas
 affected,
 limiting
 the
 development
 potential
 of
 a
 downtown
  area
 or
 residential
 district
 versus
 what
 the
 market
 would
 otherwise
 have
 allowed.
 

a. A
  skyline
  of
  a
  city,
  and
  therefore
  part
  of
  that
  city’s
  visual
  identity,
  may
  be
  defined
  in
  part
  by
  multiple
  structures
  deemed
  to
  be
  obstructions.
 
  Should
  maintenance
  or
  reinvestment
  in
  these
  structures
  deteriorate
  over
  time,
  causing
  them
  to
  look
  different
 or
 require
 reconstruction
 or
 modification,
 the
 skyline
 of
 a
 city
 may
 change.
 
 
 
 
  7. New
 proposed
 developments
 face
 significant
 obstacles
 in
 being
 capitalized
 with
 equity
 and
  debt.
 
 
  a. Unless
  and
  until
  the
  new
  policy
  is
  adopted,
  a
  climate
  of
  uncertainty
  would
  overshadow
  any
  prospective
  investment
  deal
  on
  property
  subject
  to
  the
  height
  limitations,
  which
  is
  likely
  to
  delay
  projects
  that
  are
  presently
  proposed
  or
  permitted,
 but
 that
 have
 not
 yet
 begun
 construction.
 
  8. Existing
  properties
  that
  exceed
  the
  proposed
  OEI
  criteria
  change
  limitations
  would
  likely
  face
  similar
  challenges
  to
  proposed
  development,
  although
  the
  nuances
  and
  effects
  over
  time
 are
 less
 predictable
 because
 the
 properties
 would
 be
 “grandfathered-­‐in.”
  a. Despite
 the
 FAA’s
 conveyance
 of
 a
 “no
 hazard”
 determination
 on
 existing
 property,
  it
  would
  likely
  become
  known
  that
  the
  building
  may
  exceed
  the
  more
  restrictive
  heights
  in
  the
  OEI
  criteria
  to
  property
  owners,
  risk
  managers,
  and
  investors
  in
  a
  building.
 
  9. A
  condominium
  tower
  presents
  another
  important
  example,
  whereby
  the
  owners
  of
  individual
  residential
  units
  may
  not
  be
  able
  to
  obtain
  favorable
  personal
  homeowners’
  insurance
 or
 favorable
 mortgage
 terms,
 substantially
 inhibiting
 the
 value
 of
 a
 home
 on
 the
  open
 market.
  a. Units
  located
  in
  sections
  of
  the
  tower
  that
  exceed
  the
  FAA’s
  height
  limitation
  may
  not
  be
  approved
  for
  reconstruction
  if
  disaster
  struck,
  leaving
  lenders
  less
  likely
  to
  finance
  mortgages
  at
  the
  upper
  levels
  of
  the
  building
  than
  at
  the
  lower
  levels
  where
  it
  is
  likely
  that
  a
  condominium
  would
  be
  rebuilt
  with
  insurance
  proceeds
  should
  the
  building
 have
 been
 largely
 destroyed.
 
 
  10. It
  is
  possible
  that
  the
  financial
  impact
  of
  the
  policy
  on
  the
  cash
  flow
  and
  value
  of
  existing
  properties
  would
  cause
  some
  owners
  to
  default
  on
  existing
  debt
  service
  or
  repayment
  obligations.
  a. Lenders
 would
 foreclose
 on
 affected
 properties,
 accepting
 prospectively
 significant
  loan
 repayment
 losses
 upon
 resale
 to
 alternative
 owners,
 which
 would
 acquire
 the
  property
  at
  its
  then
  market
  value,
  taking
  into
  consideration
  its
  limited
  cash
  flow
  potential,
 risk
 profile,
 and
 financeability.
 
  11. Where
 there
 may
 be
 a
 number
 of
 these
 structures
 in
 one
 location,
 the
 very
 look
 and
 feel
 of
  that
  location
  or
  neighborhood
  could
  change
  over
  the
  long-­‐term,
  also
  broadly
  affecting
  the
  value
 of
 nearby
 properties
 that
 themselves
 are
 not
 restricted
 by
 the
 policy.
 
 
  12. While
  unlikely
  in
  most
  instances,
  it
  is
  possible
  that
  some
  building
  owners
  would
  become
  so
  desperate
  to
  eliminate
  the
  financial
  challenges
  posed
  to
  grandfathered
  buildings
  that
  they
  would
 choose
 to
 demolish
 some
 portion
 of
 their
 structure
 so
 that
 it
 conformed
 to
 the
 height
  limitations
 and
 was
 no
 longer
 non-­‐conforming
 or
 perceived
 to
 be
 an
 obstruction
 hazard
 by
  the
 market.
  a. This
  would
  be
  an
  unlikely
  extreme
  measure,
  yet
  possible
  given
  that
  we
  do
  not
  yet
  know
 how
 the
 markets
 will
 adjust
 to
 the
 new
 policy
 should
 it
 be
 implemented.
 
 
 

13. Out
  of
  3,851
  total
  existing
  obstacles
  reported
  by
  the
  FAA,
  757
  of
  them
  are
  parts
  of
  occupiable
  buildings.
 
  These
  buildings
  are
  located
  in
  46
  U.S.
  States
  or
  U.S.
  Territories,
  and
  the
  average
  existing
  non-­‐conforming
  obstruction
  exceeds
  the
  maximum
  advisable
  height
  under
  the
  policy
  by
  over
  87
  feet.
 
  This
  is
  roughly
  the
  equivalent
  of
  an
  eight
  or
  nine
  story
  building.
 
 
 
 
 
  14. In
  addition
  to
  existing
  structures,
  there
  are
  an
  additional
  3,879
  obstacles
  proposed
  for
  development
  that
  exceed
  the
  policy’s
  height
  advisories.
 
  The
  FAA
  does
  not
  report
  what
  type
  of
  structure
  these
  proposed
  obstacles
  represent,
  but
  they
  include
  everything
  from
  occupiable
  buildings
  to
  wind
  turbines.
 
  These
  proposed
  obstacles
  are
  located
  in
  52
  U.S.
  States
  or
  U.S.
  Territories,
  and
  they
  exceed
  the
  policy’s
  height
  limitations
  by
  an
  average
  of
  nearly
 78
 feet.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

MIAMI
 AFFECTED
 PROPERTIES
 
  In
  Miami,
  there
  are
  a
  number
  of
  major
  projects
  that
  exceed
  the
  proposed
  height
  limitations,
  and
  more
  that
  are
  presently
  under
  construction
  or
  recently
  completed
  where
  the
  policy’s
  effects
  may
  hinder
  the
  financial
  success
  of
  the
  development,
  putting
  the
  feasibility
  upon
  which
  investment
  occurred
 at
 risk.
 
 Some
 of
 the
 notable
 potential
 obstructions
 are
 summarized
 as
 follows.
 
  1. The
 Palmer
 Lake
 area
 is
 located
 east
 of
 Miami
 International
 Airport
 and
 a
 byproduct
 of
 the
  creation
  of
  the
  Miami
  Intermodal
  Center.
 
  It
  has
  been
  the
  subject
  of
  significant
  urban
  planning
  focus,
  with
  hopes
  to
  develop
  a
  mix
  of
  uses
  all
  with
  access
  to
  mass
  transit
  and
  in
  close
 proximity
 to
 both
 the
 airport
 and
 downtown
 Miami.
 Palmer
 Lake
 includes
 about
 220
  acres
 of
 land,
 and
 the
 master
 plan
 would
 accommodate
 office,
 retail,
 hotel,
 and
 residential
  uses
 located
 on
 the
 lake
 itself
 as
 well
 as
 along
 the
 Miami
 River
 and
 Tamiami
 Canal.
 
 All
 of
 the
  development
  at
  Palmer
  Lake
  would
  be
  at
  risk
  of
  being
  significantly
  impacted
  by
  the
  proposed
 OEI
 policy
 change.
 
 This
 is
 particularly
 true
 because
 Palmer
 Lake’s
 buildings
 will
  be
 developed
 in
 multiple-­‐phases.
 
  2. Maefield
  Development’s
  proposed
  Arsht
  Center
  Parking
  Garage
  project
  would
  be
  an
  obstruction,
  even
  if
  located
  on
  a
  different
  nearby
  site
  than
  originally
  proposed.
 
  The
  project
  proposed
 development
 of
 a
 100',
 8-­‐story
 parking
 garage,
 450,000
 square
 feet
 of
 retail
 space,
  and
 20-­‐story
 electronic
 signage
 billboards.
 
 
  3. The
 Casino
  Miami
  Jai
  Alai
 project
 was
 completed
 last
 winter,
 and
 exceeds
 the
 OEI
 height
  limitations
  by
  approximately
  24
  feet.
 
 
  ABC
  Funding,
  the
  manager
  of
  the
  loan
  for
  several
  funds,
 filed
 a
 foreclosure
 lawsuit
 in
 September
 against
 Florida
 Gaming
 Centers
 and
 Florida
  Gaming
  Corp.
  The
  property’s
  development
  has
  failed,
  and
  because
  it
  is
  a
  special-­‐use
  property
 with
 a
 lender
 interested
 in
 recuperating
 its
 investment,
 it
 is
 likely
 that
 there
 is
 an
  alternative
  highest
  and
  best
  use
  of
  the
  site.
 
  The
  property’s
  more
  feasible
  redevelopment
  would
 likely
 be
 inhibited
 by
 the
 proposed
 OEI
 policy
 change.
 
  4. Satander
 Global
 Property
 plans
 to
 raze
 the
 building
 at
 1401
 Brickell
 to
 construct
 a
 50-­‐story
  tower
 on
 the
 2.02-­‐acre
 site.
 The
 property
 holds
 development
 rights
 for
 more
 than
 800,000
  square
  feet
  of
  office
  space,
  which
  would
  exceed
  the
  OEI
  policy’s
  height
  limitations
  by
  nearly
  500
 feet.
 
  5. Resorts
 World
 Miami
 is
 being
 proposed
 for
 a
 30-­‐acre
 site
 in
 downtown
 Miami
 by
 Genting
  Group.
 
 The
 project
 would
 include
 5,000
 hotel
 rooms,
 700,000
 square
 feet
 of
 convention
 and
  meeting
  space,
  1,000
  residential
  units,
  and
  countless
  retail
  stores
  and
  entertainment
  amenities.
 
  It
  also
  contributes
  to
  the
  completion
  of
  the
  150-­‐acre
  Baywalk,
  which
  is
  an
  important
  public
  access
  amenity
  in
  the
  City
  of
  Miami.
 
  Resorts
  World
  Miami’s
  $3
  billion
  investment
 would
 likely
 be
 subject
 to
 the
 OEI
 policy
 determinations,
 and
 because
 this
 is
 a
  multi-­‐building,
  multi-­‐phased
  project,
  each
  subsequent
  phase
  would
  be
  at
  risk
  of
  being
  limited
 in
 height.
 
  6. Miami
  World
  Center
  is
  being
  proposed
  for
  development
  by
  the
  Falcone
  Group
  and
  Centurion
 Partners,
 with
 a
 notable
 investment
 made
 by
 CIM
 Group.
 
 The
 nine-­‐block
 project
  would
  be
  developed
  in
  multiple
  phases,
  incorporating
  residential,
  retail,
  office,
  and
  hotel
  spaces.
 
 The
 entire
 project
 would
 likely
 be
 subject
 to
 the
 OEI
 criteria.
 
  7. 1400
  Biscayne
  Center
  is
  being
  proposed
  for
  development
  by
  Espacio
  USA,
  a
  Spanish
 

development
  firm
  that
  has
  retenented
  the
  existing
  office
  building
  on
  the
  site,
  but
  now
  intends
 to
 move
 forward
 with
 the
 site’s
 redevelopment
 as
 originally
 planned.
 
 Espacio
 has
  engaged
 I.M.
 Pei’s
 firm
 to
 design
 a
 two-­‐tower
 residential
 and
 office
 property
 to
 be
 built
 in
  two
  phases.
 
  The
  first
  tower
  will
  include
  office
  space
  in
  a
  173-­‐foot
  structure,
  while
  the
  second
 phase
 will
 include
 a
 65-­‐floor
 residential
 and
 office
 tower
 totaling
 651
 feet.
 
  8. Related
 has
 several
 projects
 that
 have
 not
 yet
 begun
 construction,
 but
 that
 would
 likely
 be
  affected
  by
  the
  proposed
  OEI
  change.
 
  These
  include
  IconBay,
  which
  is
  selling
  condominiums
  on
  a
  pre-­‐construction
  basis,
  and
  where
  any
  existing
  determinations
  may
  expire.
 
 
  Related
  is
  also
  under
  construction
  with
  other
  towers,
  including
  MyBrickell
  and
  Millicento
 1100
 Brickell,
 both
 of
 which
 likely
 exceed
 the
 height
 limitations.
 
 Because
 these
  properties
  are
  all
  condominiums,
  the
  OEI
  change
  may
  present
  unique
  end-­‐user
  concerns
  that
 may
 challenge
 the
 sellout
 potential,
 insurability,
 or
 financeability.
 
 
 
  9. Brickell
  CitiCentre
  is
  undergoing
  site
  work
  by
  the
  developer,
  Swire
  Properties,
  but
  construction
  on
  its
  towers
  has
  not
  yet
  begun.
 
  Totaling
  approximately
  4.6
  million
  square
  feet
  comprising
  a
  mix
  of
  uses,
  CitiCentre
  would
  be
  one
  of
  Miami’s
  largest
  projects.
 
  It
  has
  been
  stalled
  in
  2008
  due
  to
  the
  recession,
  and
  originally
  had
  determinations
  of
  no
  hazard
  issued
  by
  the
  FAA,
  but
  due
  to
  its
  multi-­‐phased
  nature
  these
  determinations
  are
  likely
  to
  expire.
 
 
 
  10. Florid
 East
 Coast
 Realty
 is
 proposing
 a
 redevelopment
 of
 1101
 Brickell
 with
 Miami’s
 tallest
  building,
 rising
 824
 feet.
 
 While
 originally
 proposed
 in
 2006,
 and
 approved
 for
 development,
  the
  project
  was
  placed
  on
  hold
  due
  to
  the
  recession.
 
  Site
  work
  and
  demolition
  of
  the
  existing
  structures
  on
  the
  site
  has
  now
  begun,
  although
  construction
  of
  the
  new
  tower
  does
  not
  yet
  appear
  to
  have
  started,
  putting
  the
  height
  approvals
  in
  jeopardy.
 
  The
  project
  is
  proposed
 to
 include
 over
 600
 condominium
 units
 and
 270,000
 square
 feet
 of
 office
 space.
 
 

Sponsor Documents

Or use your account on DocShare.tips

Hide

Forgot your password?

Or register your new account on DocShare.tips

Hide

Lost your password? Please enter your email address. You will receive a link to create a new password.

Back to log-in

Close