BH3 Management and Merrimac Ventures, two of South Florida’s leading development firms, have teamed up to execute the City of Miami’s long-held vision of a thriving destination on Watson Island. The joint venture will draw upon their deep local roots and collective expertise to bring to life 10.7 acres of land on the island, which is one of the most vital properties in South Florida, situated along Biscayne Bay midway between Downtown Miami and Miami Beach.
The BH3 Management and Merrimac Ventures JV acquired the lease from Mehmet Bayraktar’s Flagstone Property Group who first acquired the rights to develop the land via Miami voters in a city-owned land referendum in 2001. Flagstone Property Group was able to complete the Island Gardens Mega-Yacht Marina but failed to complete the proposed mixed-use development which is set to include hotels and retail. The lease then went through a series of dramas including the City Commission voting to end the lease with Flagstone Property Group who used the city and ultimately the city entered an agreement to pay the developer $20 million.
The transaction between the BH3 Management and Merrimac Ventures JV with Flagstone Property Group was brokered by Alex Zylberglait on behalf of Marcus & Millichap and does not include the Island Gardens Mega-Yacht Marina. The Joint Venture now holds the 75-year lease paying $2 million in annual rent to the City of Miami.
Initial site work at the property, including utility and infrastructure improvements, will soon get underway following the transfer of an existing City of Miami lease to BH3 Management and Merrimac Ventures. In the coming months, the development team will be evaluating how this portion of Watson Island can be designed, curated and programmed to deliver public benefits while aligning with today’s market.
Benefiting from a long track record of bringing signature developments to life, the joint venture has deep experience undertaking transformative projects and creating regional destinations. BH3 Management, led by principals Daniel Lebensohn and Gregory Freedman, has developed more than 4 million square feet of commercial real estate including Privé at Island Estates in Aventura, and has deployed in excess of $2 billion of capital since its inception.
“Watson Island is one of the City of Miami’s most important and well-situated properties, yet it’s also one of its most underutilized assets,” said Greg Freedman, Principal at BH3 Management. “For two decades, Miami residents have been anticipating the creation of a mixed-use development at this site, and now that vision will come together. Our plans for Watson Island will deliver an amenity for nearby residents, as well as a destination for visitors from across South Florida and around the world.”
Merrimac Ventures, led by brothers Nitin and Dev Motwani, is currently developing assets valued above $3 billion and its principals have led some of the largest real estate developments in South Florida, including the $4 billion, 27-acre Miami Worldcenter in Downtown Miami; the Four Seasons Fort Lauderdale Hotel and Residences; Paramount-branded condominiums in Miami and Fort Lauderdale; and the Las Olas Riverfront.
“The development of Watson Island is an opportunity to rethink the way people can access this beautiful site, which offers unobstructed vantage points featuring the Downtown Miami skyline, Biscayne Bay, Museum Park, and the cruise ships at PortMiami,” said Nitin Motwani, Principal at Merrimac Ventures. “Miami is synonymous with the water, and yet there are surprisingly few places where residents and visitors can access the waterfront. Our plans for Watson Island will be centered around public space and the site’s bayfront setting, offering some of the best views in all of Miami.”
Miami voters initially approved plans for the privately-funded development of City-owned land on Watson Island back in 2001, and the lease on the property was most recently modified in 2019. A site plan is already approved, combining hotel, retail, and residential uses alongside new public space and a waterfront promenade. While the plan will be modernized, BH3 Management and Merrimac Ventures intend to develop within the same footprint and density allowances that voters previously approved, ushering in investments in quality-of-life, resiliency, and infrastructure improvements – without putting a burden on taxpayers.
Nitin Motwani of Merrimac, Daniel Lebensohn of BH3, Dev Motwani of Merrimac, Greg Freedman of BH3