Every Available Square Inch

Developers in Coconut Grove have learned a couple of things about rules: They can be used to personal advantage. And they can be used as weapons.

Bruno Carnesella holds a cigar and a cell phone in one hand and a fat billfold in the other as he exits the Neighborhood Enhancement Team office in Coconut Grove, a sort of mini-city hall located in Peacock Park. The tall, debonair Italian, who left Genoa 25 years ago and came to the Grove to do business as a general contractor, follows NET office director Christina Abrams out the door. His perfectly trimmed salt-and-pepper hair and stylish clothes -- white cotton windbreaker, pressed jeans, black penny loafers -- add to his continental cool, which occasionally can be broken by fits of Italian temper.

But today Carnesella is all smooth persuasion as he and Abrams walk up McFarlane Road. Carnesella is accustomed to making his point; having his hands full doesn't keep him from gesticulating for emphasis when the two stop opposite a barren lot near the corner of McFarlane and Grand Avenue. Carnesella steps into the street and sweeps his arm toward the collection of trash and weeds in an expansive gesture.

Abrams listens politely from the sidewalk as Carnesella infuses the space across the street with a vision. She has heard many rumors about what might happen to the vacant land where Grove Calloway's restaurant (and the historic Peacock House before it) used to stand. Johnny Rockets, the Fifties-style eatery, sits on the narrow corner. Behind it is Miami Subs and then Se*or Frog's Mexican Grill, each with its enclosed area on Grand and patio on McFarlane. The former Calloway's site occupies the rest of the lot, leaving a blank swath across one of the most valuable and congested commercial corners in the Grove.

The dining spots near the corner, whose single-story heights recall an era when the Grove actually resembled a village, today are being overshadowed by a growing concrete canyon. The CocoWalk and Mayfair shopping and entertainment behemoths face them on Grand. Behind the empty Calloway's site and fronting on McFarlane are the four floors of CocoView, a complex of business suites and apartments, most of which are empty.

Just to the east and facing Grand Avenue are the walls of a mammoth, three-story Spec's music store under construction by a development partnership led by the Comras Company of Miami Beach. The 34,000-square-foot structure, which will include other tenants as well, straddles the site of a former parking lot and the old Kennedy Studios, a single-story, diamond-shape building. The developers saved their new structure from becoming just another rectangular monolith by incorporating a portion of the Kennedy building into their new design -- the leading edge of the diamond, like the prow of a ship, pokes out toward Grand Avenue.

To fill in the development hole where Calloway's once operated, Carnesella is asking Abrams to imagine a relatively humble project: a series of kiosks with food and handicraft vendors around a cafe area serviced by a bar on the back side of Se*or Frog's. He has already submitted to city bureaucrats the plans for this small-scale project, on behalf of his client, Richard Peacock, scion of the pioneering Coconut Grove family and owner of the restaurant corner and the Calloway's lot.

Abrams plays a key role in the city's complicated building-approval process -- she is charged with overseeing all construction in Coconut Grove. A staff of inspectors is stationed in her office to keep a watchful eye on a project's compliance with city codes. Perhaps more critical to Carnesella are Abrams's responsibilities as a liaison to neighbors and community groups regarding developers' intentions. It would not hurt Carnesella's client to have sensitive Grove residents informed about the pedestrian-friendly, modest scale of the plan.

Despite the aggressive sales pitch, Abrams, like many city employees who have seen the plans, says she is convinced the kiosks and the brightly colored table umbrellas will never appear. According to this cynical view, Carnesella's plans are really a diversion designed simply to get the city permit procedure rolling. The true intent is to develop every available square inch of valuable commercial property. Current regulations would allow Peacock to build 18,000 square feet on the corner, which would necessarily mean a two-story building that would incorporate the existing restaurants. Abrams says she is betting that Carnesella will soon show up at the city's planning, building, and zoning department with plan "revisions" that in fact will represent something completely new: a retail project on a scale to match its prodigious neighbors.

Rumors have been circulating for months that Peacock has been talking to Blockbuster about competing with Spec's in a new store on his corner lot. Peacock does admit that one of his options is a two-story building and that he has spoken with Blockbuster and other chain stores, but no one has signed a lease. Carnesella, however, dismisses the idea of a two-story building and says he has counseled Peacock against the idea because a single tenant would have to pay an exorbitant rent if the project is to be financially feasible. City building officials still tease Carnesella by asking him when he will bring them the real plans. The joking frustrated him enough that he drafted a letter to the city guaranteeing that the plan for the kiosk plaza was the only development intention for the property. Peacock and Carnesella signed the letter, though Peacock candidly suggests he'd ignore it in a heartbeat. "Blockbuster would be better," he says. "You could pack your bags and go on vacation and you wouldn't have to worry [about the rent]."

In any construction and permitting process, allowances must be made for revisions resulting from unforeseen problems. But critics say the City of Miami's plan-review procedures have a tendency to stretch the rules, often when it comes to approving changes after the fact, sometimes after they have literally been set in concrete. In addition, city officials can make mistakes; they might, for example, inadvertently overlook some change in a revised building plan. It is a system that relies heavily (and precariously) on the honesty of builders and developers. "When you have plans that go incrementally [through revisions], it is hard to catch everything," admits Sergio Rodriguez, director of the planning, building, and zoning department. As if those dangers weren't enough, there is also the maddening issue of interpretation -- the precise meaning of this or that phrase in a regulation. As Carnesella says with a sly smile: "I don't draft the ordinances. Go to a rabbi or a priest, they can read the Bible in 50 different ways."

The long-frustrated members of the Coconut Grove Civic Club contend that city officials too often interpret the rules in a manner favorable to developers, and that many of those officials enjoy cozy relationships with the very people they are supposed to scrutinize. "We have regulations that people are supposed to follow," says Joyce Nelson, the club's president, "but for some reason everyone wants a variance or a special exemption to build outside the zoning limits. That's what people are upset about."

Naturally, the Civic Club is not held in the highest esteem by developers, who say the city's bureaucracy is slow enough as it is; the last thing they need is a bunch of meddlesome activists. "They appeal most of the projects," Carnesella says. "The Civic Club, as a normal process, is banging the heads of everyone, which is normal in Coconut Grove."

Ever true to its mission, the Civic Club attempted to limit the potential for development on Peacock's property. It also tried to rein in the Spec's project next door. In both cases it failed. But in a novel turn of events A odd even for the iconoclastic Grove A the developers themselves have picked up where the Civic Club left off. Peacock and Comras (along with tenant Spec's) have been battling each other, using parking and building ordinances as weapons, in what has become the city's biggest zoning war in recent memory.

Spec's went to court to challenge Peacock's waiver from Coconut Grove's parking ordinance, which allows him to build on his corner lot without providing on-site parking. (Anyone who has ever been anywhere near the Grove understands that parking is a very serious issue.)

Peacock retaliated by challenging a special design permit for Comras's new building because a portion of it intrudes into the public right of way reserved for sidewalks and utilities. That portion is the pointed section of the old Kennedy Studios building jutting out toward Grand Avenue. It has come to be known as the "nose." Initial plans showed the nose being incorporated into the new building essentially intact, but after a series of revisions, large windows were added and the roof gave way to an outdoor deck. For the tenant, Spec's, the glass nose is one of the building's most attractive features.

When city officials investigated, they made an unhappy discovery: Peacock was correct. The nose of the new building did encroach on the right of way, meaning that the Comras building permit had been issued in error.

According to Peacock, the technicalities hide the true motives behind the backstabbing. Spec's went after his parking waiver, he says, because the company feared he was negotiating with Blockbuster and others. "Why would Spec's appeal my parking permit?" Peacock asks. "What do they care? They care because they don't want a Blockbuster or a Peaches there."

John Fletcher, an attorney for Spec's, claims his client was simply worried about the parking situation in Coconut Grove. But when the city in December took the extraordinary step of ordering Comras to tear down the glass nose, Spec's realized that the cost of concern for parking was perhaps too high. "What Spec's started out to do escalated into global warfare and came around and bit their landlord in the ass," says Fletcher. "That makes for a bad relationship between a landlord and tenant." The city's action brought a halt to construction, which drove up Comras's costs. Moreover, Fletcher adds, without the flashy glass nose on its new home, Spec's might no longer be interested in the building, and Comras would be stuck with a vacant, half-finished project.

Richard Peacock could just as easily have sympathized with Comras as launched an attack on the company. After all, he has had his share of problems with the city. In 1990 he opened Grove Calloway's with the understanding that it would include his family's historic Peacock House, which had stood on the McFarlane side of the Peacock property for 50 years. Preservationists and city officials agreed to the project, but no one was quite ready for the end result. All that remained of the old home was the roof, the attic, and a bit of framing. In its place stood a gaudy, loud restaurant and rum bar that bore zero resemblance to anything authentically historical.

Civic activists were appalled, but by the time city officials realized they had overlooked changes in Peacock's revised plans, it was too late. Their only legal recourse was to issue permits for the new building as it existed; the old one was long gone. Today there is nothing but dirt. After several businesses failed on the site, the city last year forced Peacock to demolish what remained.

In February 1994, Stephen Helfman, a Comras attorney, made a trip to the public works department's executive offices on NW Second Street in downtown Miami. Because his clients were building in Coconut Grove, which is designated as a protected area, a special design permit had been required. But the department's chief civil engineer, Leonard Helmers, had refused to approve the permit. Helmers had taken one look at the size of the Comras project and decided the city would need wider sidewalks to accommodate the anticipated crowds of shoppers. Unfortunately, the nose presented a problem; it stuck out into the public right of way, just as it had when it was part of the old Kennedy Studios. But a much larger building would mean many more people. So Helmers withheld approval.

Attorney Helfman, on Comras's behalf, went to see Jim Kay, who is deputy director of the public works department. In the development world, Helfman is a big gun; his firm spends most of its time representing cities. Helfman himself is the city attorney for Key Biscayne and Miramar, and deputy city attorney in Bal Harbour and Homestead. "I am very familiar with right-of-way issues and encroachments," Helfman says confidently.

The attorney had a request. "He was nice about it," remembers Kay, who has dealt with Helfman often. "Helfman said, 'We have a development going here and we would like to keep the old Kennedy Studios and make a few modifications to it, maybe a few windows.' I thought about it and I said, 'Okay, as long as you're not doing anything major to it, we will let you keep [the old building] out there.'" Comras, however, would have to sign an agreement with the city to give up the property if the city ever needed it. Then Kay formally overruled Helmers and granted Comras a waiver from the city's right-of-way regulations. But Kay, it turns out, never looked at the actual building plans. And he says Helfman did not mention that nearly all of the old Kennedy building would be demolished, an alteration so substantial that granting a waiver should have been impossible. (Certain existing buildings that intrude upon the public right of way can be "grandfathered" into a new project if the existing structure is not altered. Otherwise it must be removed.)

Helfman had earned his money -- he had secured for his clients the coveted design permit. Comras then began the more routine process of obtaining actual building permits. In June a city bureaucrat apparently missed the developer's demolition plan, which showed all but one wall of the old Kennedy building being knocked down. And in October, when Comras submitted a revised set of plans, Lourdes Slazyk, the city planner who reviewed them for design changes, admits she overlooked a proposed door on the second floor that could have turned the roof of the nose into a deck, which could violate the city's zoning ordinance.

Two weeks before Christmas, Bruno Carnesella went to the Coconut Grove NET office and complained about the Comras construction. Office director Christina Abrams remembers Carnesella saying, "Comras has knocked down the whole [Kennedy] building. How can they have grandfather status when the building is gone?" Some weeks earlier, code enforcement officer Bryan Harms had noticed the Kennedy Studios building being demolished. He called downtown with disturbing news: The city apparently had approved plans that would violate its own code. But the information, Harms says, stirred little interest until Carnesella made his complaint. Carnesella, though, scoffs at the idea that he could make the city spring into action. "This thing exploded and now everyone say this is Bruno," he protests. "If I had this kind of clout, I would be the happiest man in town."

On December 15, the nose situation came up at a regular meeting of members of the planning, building, and zoning department held by Sergio Rodriguez, the department's director. The 9:00 a.m. gathering had worn on till noon, and Rodriguez sprang for pizza to keep the officials, who were becoming increasingly nervous as the nose controversy rose toward the city manager's office, from using hunger as an excuse to leave the room. When Rodriguez asked for a review of the city's actions, someone at the table called it a "comedy of errors."

According to three participants, it was clear there was enough blame to go around: The building division missed the demolition, which violated both the South Florida Building Code and the public works section of the city code, Jim Kay's waiver notwithstanding. In addition the design permit was transgressed when the city's Lourdes Slazyk missed the new door to the nose's proposed deck. "The conclusion was there were probably omissions in the way we reviewed the plans," Rodriguez admits. "As far as I was concerned, if there were mistakes, we must uphold the law." The group decided that the public works department would lead the offensive against Comras: The building permit would have to be rescinded and the nose torn down.

The next day Comras was ordered to demolish the nose within seven days or the city would revoke the building permit, cut electrical service to the construction site, and order workers off the property.

Helfman responded in writing with a blistering attack on the city's "perplexing and confusing" decisions, which could have no "conceivable purpose...other than to intentionally delay the project." The city, Helfman says, is frightened it may have made a mistake, but even if that's true, it is not the fault of the developer, who nevertheless has had to pay for the delays.

"My clients have used the system to help themselves," Helfman almost shouts over the telephone. "They have gotten permits every step of the way, and my advice has been to follow every goddamn one of them. If something is to your benefit, use it A but follow the rules."

However, following the rules, and even bending them your way with a little gentle persuasion, wasn't working this time. Helfman was irritated. He didn't know exactly what had prompted the city's new get-tough attitude, but he suspected the NET office's vague reference to "complaints from area residents" could be reduced to one name: Richard Peacock.

The developers' squabble escalated into full combat with a little push from the pesky Coconut Grove Civic Club. The club had viewed Peacock's parking waiver as a threat to the Grove's Parking Trust Fund, which had the practical effect of limiting development because it required new buildings to provide on-site parking. When the fund was created in 1993, existing businesses had 1000 fewer spaces than the city required. They were allowed to buy mythical spaces from the fund, which would later be used to build a parking structure.

Peacock had been allowed 62 fund spaces as part of his plan to renovate Grove Calloway's. But instead of being renovated, the building had been torn down. Now Peacock had new plans -- the ones Carnesella described with such enthusiasm -- and the obvious question was this: With the old building gone and a new project envisioned, was Peacock still entitled to his 62 spaces? The city decided it had no provision for taking back parking spaces (even though Peacock was behind in his payments to the fund). This opened the possibility that anyone could tear down a building, put up a new one, and avoid providing on-site parking. "The parking fund is a hot issue," says Christina Abrams. "If [the Peacock spaces] were allowed, it would apply all over the Grove, and that would be a problem."

Last November the Civic Club attacked Peacock's waiver by appealing to the city's zoning board. But Peacock hired respected land-use attorney Stanley Price, who convinced a court that the club had no right to appeal because it was not a nearby neighbor of the property. The new Spec's building, however, was right next door. The company hired an attorney to pursue its own appeal against Peacock. When the city told Spec's the deadline to appeal had passed, Spec's attorney took the city to court. That case will be heard in March, and while the parking issue remains unresolved, Peacock will be unlikely to find a tenant for anything he might build.

Three days before Christmas, Peacock responded by piling on with the city regarding Spec's nose. Through his attorney, he requested that the city hold a formal zoning appeal hearing about the subject. Now both projects were hopelessly tied up in red tape. Mortgage payments, contractors' bills, and attorneys' fees were going up much faster than staircases and umbrellas.

On the Friday before Christmas, Christina Abrams had to leave her holiday office party for a hastily called meeting at city hall. Stephen Helfman had rattled enough political cages that the nose controversy had reached the ears of City Manager Cesar Odio. The planning, building, and zoning staff, Assistant City Attorney Joel Maxwell, and Abrams and an inspector from her office met with Odio while Helfman waited outside for a chance to argue his client's case.

According to three sources who attended the meeting, Odio was not very happy about the city's mistakes. This was another example of Grove developers outmaneuvering the city, a disgusted Odio said, according to one participant. The oversights in reviewing the plans were particularly frustrating. When one official told Odio that a city ordinance required architects to follow the rules even when city staff makes a mistake, Odio reportedly shot back: "If that is the case, why do we need a planning department?" (Odio did not return calls for comment.)

Maxwell, the assistant city attorney, surprised some at the table by saying the city had little hope of defending the order to tear down the nose should Helfman take them to court. Withdrawing a building permit would be difficult, Maxwell thought, according to two sources at the meeting. "He was advising us left and right to fold up and let them do what they wanted to do," recalls one of those sources. (Maxwell declined to comment on any issue concerning the Comras property.)

But department head Sergio Rodriguez and other officials pointed out that the city code clearly had been violated because the old Kennedy building had been dramatically altered as it was transformed into the Spec's nose. Rodriguez also noted that there was no appeal of the code. In effect the city would be agreeing to an illegal act. "We discussed that Comras had changed the building so much it was not what had been approved," Rodriguez recounts. "My position was [the nose] had to be demolished."

Odio agreed. Rodriguez recounts that when Helfman entered the room, the manager said, "'Steve, this is going to be a short meeting. We cannot violate our own city code because there is no appeal to the code." Abrams and others left the meeting heartened by Odio's firm backing of the city's tear-down order.

At the end of the first week of the new year, the three high-priced attorneys persuaded their clients that it was time to make peace. The situation clearly had gotten out of hand, and the cost of fighting each other and the city was prohibitive. "We didn't mean to start a friggin' nuclear war," chuckles John Fletcher, Spec's attorney. The principals sat down on January 10 and worked out a cease-fire. "I told them [Spec's], 'You quit bothering me and I'll quit bothering you,'" Peacock says. "Also we become friends and I don't appeal anything they do [in the future] and they don't appeal anything I do."

But that agreement has not been signed. Spec's still has one major problem: the city. "If Comras can't solve its dilemma with the city, then neither it nor Peacock can promise us anything," Fletcher says. Spec's wants to be assured use of the glass nose, as promised in its lease with Comras. Without the nose, Fletcher says, Spec's will continue the zoning war, presumably in an effort to pressure both Peacock and Comras to lean on city officials to keep the nose intact.

Helfman is already doing his best to keep the pressure on. Despite Odio's seemingly firm commitment, Helfman says he got the city to agree to delay enforcement of the tear-down order. Maxwell, the city attorney who opposed fighting the developer, has been circulating among various city officials a proposed settlement between the city and Comras. The proposed agreement, which was created by Helfman, offers the city unconditional surrender: The nose will remain, to be torn down only if the city provides 180-day notice that a contractor is ready to widen Grand Avenue. The city also must reapprove the revised plans and allow the building to be completed without further delay. Signature lines are provided for Comras and Cesar Odio.

For some reason, a copy of the agreement was not sent to the Coconut Grove NET office, where the complaints originated. Abrams, the NET office director, was surprised to learn of a proposed settlement agreement, but she insisted the city would stand by the law. "Don't forget that I am the city, too, and that settlement agreement has not been signed yet," Abrams said. "I like to think it won't be."

This past week the city was still negotiating with the industrious Helfman. His proposed agreement was clearly unacceptable as written, according to Wally Lee, director of the public works department. The city code would have to be amended to include a specific exception just for Spec's nose, Lee stated in a memo. But the city's law department was still trying to come up with an acceptable compromise, despite the protracted delay in rectifying a code violation. "This is the first case where we have had something like this," Lee said last week.

Not far from Abrams's office, workers last week were back on the job at the Spec's site. The city had given permission for continued construction A on everything but the nose, which had to wait for some sort of agreement to be reached between Comras and the city. "It doesn't make sense," Abrams said when she was read the proposed agreement. "There is this law that clearly states the [nose] should not be there. I can't see a way around it.

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