Miami looks at canceling Watson Island land deal

Just a month after the City of Miami approved the sale of a 3.2-acre Watson Island site to a developer, the commission is set to reconsider the deal amid concerns about valuation, deal structure and timing before new leadership takes office.

On Jan. 8, commissioners will revisit the Watson Island sale under an agenda item sponsored by District Four Commissioner Ralph Rosado, who cast the lone dissenting vote when the deal was approved 4-1 on Dec. 11. Mr. Rosado says reconsideration is needed to protect the rare waterfront property, make sure the city gets a fair return and ensure public land is managed responsibly.

The site at 888 MacArthur Causeway is part of Watson Island, a city-owned island on Biscayne Bay just east of downtown. In 2024, voters approved allowing the sale of land on the island for at least $25 million.

The 3.2-acre site was approved for sale to a joint venture between BH3 Management and Merrimac Ventures for $29 million, accompanied by a $9 million public benefits package. That package is to fund affordable housing, infrastructure improvements, waterfront access enhancements, arts programming and job training initiatives, with staged contributions tied to building permits and certificates of occupancy.
The sale cleared the way for a mixed-use development including condominiums, hotels, retail and expanded public spaces. Developers committed to public amenities, such as a 2.2-acre promenade along Biscayne Bay open at no cost, a maritime and art gallery, small business kiosks and skills training programs.

Mr. Rosado was the lone dissenting vote on Dec. 11, citing concerns that the city had not negotiated the best possible deal. In a Dec. 29 op-ed in the Miami Herald, he explained his reasoning, highlighting several issues with the sale. He argued that independent appraisals did not fully account for the unique value of waterfront land, noting that “waterfront land like Watson Island does not attract ordinary development” and that the city was not leveraging its full negotiating power.

He also criticized the deal structure, saying the buyer is the existing ground leaseholder and that “one-party negotiations almost always suppress value.” Mr. Rosado said the appraisal process collapsed decades of projected income and reversionary ownership into a present-day figure that “represents just a floor, a starting position, not a final valuation.”

The commissioner also raised concerns about timing of the sale, which coincides with the transition to a new mayor and city manager. He wrote that a permanent conveyance before new leadership takes office “undercuts the spirit of thoughtful, deliberate governance” and that pausing the sale “is not obstruction; it is common sense.”

Finally, Mr. Rosado questioned the agreement’s safeguards. While the deal includes a roughly 10% share of profits if the property is flipped, he said it “invites speculation by allowing a private party to capture most of the upside, while the public watches from the sidelines.” He called for careful consideration to protect public assets, ensure transparency and maximize long-term value for residents.

In a Dec. 29 memorandum to outgoing City Manager Arthur Noriega, Mr. Rosado formally reiterated his request to withhold execution of the sale until the Jan. 8 meeting. He emphasized that the pause is procedural, intended to protect the city’s and residents’ interests, and not to block development.

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