Rough Ryder

The behind-the-scenes battle to put Miami's homegrown Fortune 500 Co. next to the Herald raises an old specter

In Miami irony is as much a part of the landscape as gridlocked traffic and palm trees. So it shouldn't come as a surprise that Knight Ridder, the media conglomerate that fled downtown Miami in 1998 for new digs in California after 24 years on Biscayne Bay, is now engaged in an effort to bring another Fortune 500 company, Ryder System, Inc., to 1 Herald Plaza.

To be more precise, Knight Ridder's real-estate advisor, Philip Blumberg, is the man putting together the deal to marry millions of dollars in public money with his plans to develop a $65 million corporate center next to the Performing Arts Center. Blumberg was also the one who, more than ten years ago, orchestrated Knight Ridder's donation of land for the arts center -- a gift that virtually assured it would be built there rather than at one of several other locations.

In the late Eighties Blumberg advised Knight Ridder to quietly acquire the property surrounding its headquarters building, so it would own a fifteen-acre swath of land between Biscayne Boulevard and the bay. "Years ago I recommended that Knight Ridder buy the land and [later] give it to the Performing Arts Center," Blumberg says, acknowledging his advice was based on the idea that the land around the center would increase in value. "For fifteen years it's been a great controversy within Knight Ridder: “Should we be in the real-estate business?'"

At the time the Performing Arts Center was a grand illusion that had been mired in controversy for a decade as various community leaders and public officials debated where it should be built and how much public money should support it. Then Knight Ridder, arguably the county's 800-pound gorilla in terms of clout and ability to influence public opinion, made its move. When the company offered to donate about three acres, it was a generous gift county and city officials found hard to refuse. With that and a land donation from the Sears company, the PAC's future -- and the renewal of a bedraggled Biscayne Boulevard corridor -- were seemingly assured.

But the implications of such a gift caused trouble for the Herald; to many observers it seemed the paper had a major conflict of interest in reporting on or editorializing about a Performing Arts Center that clearly would benefit Knight Ridder's land holdings. The apparent conflict was so uncomfortable for the Herald, in fact, that executive editor Doug Clifton found it necessary in 1993 to write an apologetic editorial.

Nearly a decade and many false starts later, the dirt is just now being overturned on PAC, the cost of which has ballooned to the current estimate of around $255 million just for the buildings. And so the corresponding economic boon anticipated by Blumberg and Knight Ridder has yet to be realized.

Enter Ryder, honking its horn. This past November Ryder announced it was looking for smaller facilities for its headquarters, currently at 3600 NW 82nd Ave. Alarm bells went off in the business community when Ryder CEO Gregory Swienton mentioned the company was considering southern Broward County. "If a company like Ryder, born and raised in Miami, is going to move, that sends a signal to every other Fortune 500 company that may be considering relocating their headquarters or a satellite here," explains Bryan Finnie, director of the county's Office of Community and Economic Development.

Immediately Blumberg saw an opportunity. If he could get the county, the city, and the state to kick in economic incentives, he could offer Ryder a new headquarters right in downtown Miami, on the languishing Knight Ridder property. He put together a development plan and began shopping it around the city and county as the "Biscayne Center Project," to be developed by Blumberg's company, American Ventures Realty Corp.

City and county officials were happy to get behind any proposal that could keep Ryder from moving to Broward. After talking to Finnie, Blumberg proposed that the project could use eight or nine million dollars in federal funds funneled through the county. The city could contribute millions in tax incentives over ten years. Blumberg also hired überlobbyist Ron Book to work the state angle. Book, Blumberg, and attorney Al Dotson, Jr., went to Tallahassee to lobby for a change in a state business incentive that would let Ryder enjoy up to $7.5 million in tax breaks.

City Commissioner Johnny Winton, who supports Blumberg's plan, acknowledges the irony of the proposal on Knight Ridder land. "I've been trying to figure out the last time we lured a major world headquarters to the city," Winton speculates. "It's probably been over 30 years. We've lost some -- some went bankrupt, some moved to San Jose [a catty jab at Knight Ridder's 1998 departure]."

Some observers view this activity with amusement. While the Miami Herald is cheerfully pounding away on the county for letting lobbyists turn the airport into the county's biggest political cookie jar, there are a few who note with interest lobbyists working on behalf of Knight Ridder to shake the loose change from municipal coffers. Blumberg, Dotson, and two others are registered with the county as lobbyists for "Biscayne Center Project," but prominent lobbyist Rodney Barreto (who has taken multiple hits in Herald stories) believes it would be more accurate if they disclosed on registration forms that one of the interests they represent is Knight Ridder: "I think there's a question on this one: Is the Herald/Knight Ridder hiding behind Phil Blumberg?" Barreto asked.

Blumberg counters that he registered as a lobbyist for the Ryder complex he wants to develop under his company's name because he would be the developer. Knight Ridder, he says, is just the landowner in the deal.

County Manager Steve Shiver remembers that Blumberg recently showed him a rendering of a proposed Ryder complex near the Performing Arts Center. He said it was a brief conversation. "I was not aware the Miami Herald was involved. I'm sure they'll editorialize in favor of it," he quips. "I find it funny that they are often quick to come down on lobbyists and hold public officials to an extremely high standard [in dealing with] lobbyists -- yet they are hiring their own lobbyists to push their agenda."

Blumberg argues that he has been forthright about ownership of the land. As for Ryder, the company is playing it close to the vest. David Bruce, director of corporate communications, says the company has no urgency to move and plans to review all the options carefully.

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