Developer low-balls Riviera Beach
threatens seizure by city
By Stephen Deere
South Florida Sun-Sentinel
Posted May 18 2006
-- Mike Mahoney admits he has his price, but $231,000 doesn't even come
Mahoney, who owns a custom T-shirt shop on Broadway, is one of about 30
Riviera Beach property owners who received written offers from attorneys
representing Viking Inlet Harbor Properties LLC, the private company
heading up Riviera Beach's massive $2.4 redevelopment project.
Considering that others have been offered more than $700,000 for small,
two-bedroom homes, Mahoney thinks the notice is a little, well,
"I'm not going to jump on it," he said.
The property where Dee's T-shirts sits is worth $165,000, according to
the offer Mahoney received.
The notices also contain a not-subtle hint that if they don't sell, the
city's Community Redevelopment Agency could initiate eminent domain
proceedings against them, despite a new state law that says governments
can't take someone's property for private development.
In recent months, the project -- considered the epicenter of a national
debate over property rights -- has taken some strange turns, including
the city's attempt to rush it forward to ensure they have a firm legal
basis for challenging the new eminent domain law.
And while the redevelopment plan has made some ordinary folks rich, it
may send others to court to save their homes or businesses, or at least
to get a better deal.
Less than five months ago, real estate developer Wayne Huizenga Jr.
began buying up prime property along Riviera Beach's waterfront within
the CRA boundary. Huizenga, son of billionaire Miami Dolphins owner H.
Wayne Huizenga, has plans to open a megayacht-building business, and in
some cases he paid homeowners more than three times the market value for
That was then. Now the offers are lower. Much lower.
Initially, Huizenga failed to consult Viking, which has bought more than
100 properties, said Robert Healy, the New Jersey-based company's CEO.
"He did a very unwise thing by running in there and making those kind of
offers," Healy said. "I got him on the phone and said `What are you
doing?' ... Then I get a call about a week ago."
Huizenga, Healy said, wanted help. Realizing he couldn't afford to keep
shelling out large amounts of cash, Huizenga asked Healy to help him
acquire more property using the threat of eminent domain from the city's
Alex Muxo, a senior vice president with Huizenga Holdings Inc. who
usually handles media inquiries, could not be reached for comment.
"I got to tell you the truth. We aren't making any $700,000 offers on
$125,000 houses," Healy said. Although attorneys for Viking are making
the offers, Huizenga still would pay them, Healy said.
Business owners such as Mahoney, 49, are balking, especially in light of
what others received.
So is Virginia Merchant, owner of a Sea Shell City, a souvenir shop.
Just a few months ago, Viking offered her roughly $2 million for the
acre where her store sits, she said. The deal fell through, and just
Tuesday she received another offer: $800,800.
"They say they [originally] overpriced," she said. "But I know some
people got their money, and they are really happy."
Besides the substantially lower offers, Viking has another problem. The
CRA's threat of eminent domain may no longer be a legitimate threat.
The city's redevelopment boundary encompasses 858 acres and plans call
for new hotels, condominiums, marinas and shops, and rerouting U.S. 1 to
make room for a new harbor, but the Florida Legislature recently passed
a bill prohibiting governments from seizing property for private
City leaders signed an agreement with Viking last week to ensure their
contract was in place before Gov. Jeb Bush signed the bill into law,
which he did May 11. Mayor Michael Brown argues that because they have
invested millions in the plan under the old statutes, they should still
be allowed to follow previous eminent domain law.
"We are not trying to short-circuit [the governor]," said council member
Elizabeth Wade. "He is trying to short circuit us. ... You might say we
fast-tracked it, but this contract has been in the works for eight
months. I don't think we fast-tracked it."
Russell Schweiss, a governor's spokesman, said Bush and state
legislators likely would not decide if Riviera Beach is protected under
the old law.
"That would probably be something decided in court," he said.
But the governor has strong feelings about Riviera's attempts to
circumvent the new law.
"He feels the actions of the city are reprehensible," Schweiss said.
Wade said that if the CRA attempted to use eminent domain it would be on
a case-by-case basis, and she didn't fault anyone for trying to get as
much money as possible from Viking or Huizenga.
"Some people were close to negotiations if the hammer from the state
hadn't come down," she said. "I applaud these people. They should get as
much as they can."