Watson Island developers plan two hotels, residences, more

Two Miami developers are teaming up to update a 20-year-old vision and revive 10.8 acres of city-owned land on the south side of Watson Island with reduced density and more open, walkable space for the public, including a 1,000-foot waterfront promenade along the bay.

This November, city residents will be asked to approve Watson Harbour, a mixed-use development consisting of two hotels, residences, retail, offices, dining and expansive public spaces. The project, led by BH3 Management and Merrimac Ventures, aims to activate one of the most vital waterfront properties that sits on the shores of Biscayne Bay, nestled midway between downtown and Miami Beach.

“The property had a previous RFP from roughly 23 years ago that, for various reasons, had starts and stops. The mega-yacht marina was delivered, which provided tremendous value there. But in our view, the upland is an amazing, underutilized opportunity that was always intended for great open public space,” Greg Freedman, co-CEO of BH3 Management, told Miami Today.

In 2001, city residents approved a master development plan for the 10.8-acre Flagstone Island Gardens site at 888 MacArthur Causeway. The plans were amended in 2020 and a mega-yacht marina and waterfront restaurant were built there, now called Yacht Haven Grande Miami at Island Gardens.

In 2023, BH3 and Merrimac acquired the lease from Flagstone Island Gardens and the partners have been working on plans to redesign the project to meet current market demand.

“Since we’ve come in, we’ve been hard at work updating and reimagining the highest and best uses for that property. That’s the plan we’ve put forward and are bringing to referendum. Twenty-three years ago, the City of Miami was quite different than it is today, both in terms of usability and walkability and what visitors, customers and local users expect and how they interact,” Mr. Freedman said.

Under the master development agreement, the site was approved for 500 guest rooms in two hotels, 105 timeshare units and up to 221,000 square feet of retail, a parking garage and maritime uses.

The proposed referendum revises the existing lease, with the city selling 3.2 acres of leased property to BH3 for a fair market value of no less than $25 million, extends the term by 24 years and changes the form of ownership from timeshares to condominiums. It also seeks approval to use portions of the lease space for co-working offices or similar uses.

“This project was previously approved at referendum. We opted to refresh it and make it a 2024 project,” Mr. Freedman said. “There are two separate and distinct hotels. One of them had 105 timeshares on top. When we’re successful with the referendum in November, those timeshare units will become condominiums.”

“In between was about 260,000 square feet of retail and maritime use and we are actually looking to reduce that by over 10% and instead of having all retail and maritime use to incorporate office space because Miami has evolved and we believe that people truly appreciate the idea of live, work, play,” he continued.

“What we also found was a unique opportunity to open the space up because the way it was previously approved in design, it was very dense in the middle of the two hotel towers and we thought there was an opportunity to reduce density, where less is more, and that would allow us to create some more public space. That’s what we’re designing now. We are not increasing height. We are not increasing units. We are decreasing density and increasing public spaces, things that we believe are more in line with what the city of Miami residents want,” Mr. Freedman said.

The two towers were approved for different heights. The “lifestyle” tower is approved for 375 feet and the “luxury” tower is approved for 535 feet.

The deal comes with a community benefits package that includes a $9 million contribution to affordable housing and infrastructure improvements as well as an expanded public waterfront and a 2.2-acre pedestrian promenade along Biscayne Bay at no cost to the city.

“We sometimes gloss over the fact that it’s 2.2 acres along the bay,” Nitin Motwani, managing partner of Merrimac Ventures, told Miami Today.

“That’s 1,000 feet of water frontage that people can walk, ride a bike, push a stroller and just hang out. We think it’s an amazing opportunity because it allows the public free waterfront access with incredible views.”

“The community benefits agreement is something we’re really proud of,” Mr. Motwani continued. “That’s something we started with Miami World Center over seven years ago and that has continued to expand. We have been working with Commissioner [Christine] King’s office on that specifically.

In addition, we’ve been working with Commissioner [Damian] Pardo’s office on ways we can enhance resiliency.”

Leading up to November, the team says it will meet with neighborhood organizations, businesses and community members to campaign for the project.

“We are doing what we traditionally do, which is our neighborhood outreach and helping voters understand this 23-year challenge for the city. We’re hoping to turn it into a reality and something that will make us all very proud,” Mr. Motwani said.

If voters approve the project, the team expects it will be 12 to 18 months before the start of construction, with the public spaces and promenade being a priority in the phasing.