Developer seeks cash for ending Lido pavilion lease

Later this month, the City Commission will decide whether it wants to pay a developer to walk away from its lease of the Lido Beach pool and pavilion.

On Feb. 19, the city is scheduled to discuss the possible termination of a lease agreement with Lido Beach Redevelopment Partners LLC. In exchange for withdrawing its proposal for the city-owned property, the developer is seeking $206,224.69 from the city as reimbursement for the project costs to date.

In 2017, the city approved the lease, which authorized the group to redevelop and manage the pavilion. The group’s plans for the property included the operation of a 200-seat restaurant and the construction of a Tiki bar, splash pad and playground.

Even after the lease was in place, the proposed redevelopment was controversial, drawing outspoken opposition from residents on Lido Key and throughout the city. An online petition protesting the plans has more than 5,500 signatures.

As a result, the developer asked the city to postpone a January public hearing on the site plan as the group considered withdrawing its proposal. Although the group signaled it would also be willing to discuss changes to its agreement with the city, the majority of the discussion at a Jan. 14 commission meeting focused on the prospect of pulling the application and ending the lease.

At that meeting, the board directed staff to negotiate with the development group on a proposal for terminating the agreement. City Attorney Robert Fournier said the developer wanted compensation for some of the expenses it has incurred as it has produced plans for the site.

The commission will consider the proposed lease termination agreement at its next meeting. If approved, the developer would withdraw its site plan application within seven days.

Within 30 days, the city would pay the developer the full sum of the requested reimbursement, a figure based on costs incurred during the planning process. When the developer receives the funds, the lease would be terminated.

In a memo, Fournier recommended approving the termination agreement. He wrote that, if the lease is not terminated and the site plan application moves forward, the city is likely to face legal expenses “far in excess of the amount recommended for reimbursement.”

Fournier also said the development group’s actions in producing the plans have been in line with what the city requested.

“It is not accurate to state that the amount of money that has been spent by the applicant to date is simply ‘the cost of doing business’ (as some have stated) and I do not believe that a court would view it that way,” Fournier wrote.

Documents regarding the potential lease termination — including the proposed agreement, Fournier’s memo and an itemization of the costs for which the developer is seeking reimbursement — are available on the city’s website.