FORT LAUDERDALE — Two suitors are in the running to lease pricey space to the Fort Lauderdale Police Department until the agency’s new headquarters opens in the next two or three years.
One has more space but comes with a higher price tag, to the tune of an extra $473,512 in yearly taxpayer dollars — a potential cost of an additional $1.42 million for the benefit of getting an extra 9,438 square feet over what might turn into a three-year lease.
A vote could come as early as Wednesday when commissioners will decide on a winner. If they don’t vote on Wednesday, commissioners are expected to approve the deal at their next regular meeting on Sept. 19.
Their choices, according a document obtained by the South Florida Sun Sentinel:
Sheldon Gross, the leaseholder of the Kaplan building at 1515 W. Cypress Creek Road, is offering to lease 46,591 square feet for 24 months, with two one-year renewals. The cost per year: $1,444,318. Gross has also requested a security deposit of $120,360.
Harry Spitzer, the manager of Cypress Corporate Center at 1901 W. Cypress Creek Road, has 37,153 square feet available with a two-year lease. The cost would come to $970,806 a year. Spitzer is not requesting a security deposit.
The city will not have to pay property taxes while leasing space in either building because government-run operations are typically tax-exempt.
But investigators with the Broward Property Appraiser’s Office are looking into why the Kaplan building has not gotten a tax bill since 2010.
Both Commissioner Steve Glassman and Mayor Dean Trantalis have said they are worried about any possible debts in the form of back taxes being passed along to the city.
During a public meeting on Tuesday, Glassman argued the rent was too high at the Kaplan building.
“I’m telling you right now, this is a bad deal,” he said. “You are all considering a $470,000 increase over what we should be paying, plus a $120,000 security deposit. I think we really ought to do our due diligence.”
Trantalis said he spoke to Property Appraiser Marty Kiar and was told there might have been a gap in time prior to now where the Kaplan building might have been subject to real estate taxes.
“This is something the Property Appraiser says he would still need time to investigate,” Trantalis said. “My concern was were they paid or unpaid. And if they were unpaid, (Gross) could say I’m passing this through to all the tenants even though it was accrued before your tenancy.”
Commissioner John Herbst argued that will not happen.
“There’s no way a prospective tenant is responsible for past property bills,” he said. “Just like they’re not responsible for past water bills.”
No matter what the Property Appraiser’s Office finds, it should not affect the Kaplan lease deal, Herbst says.
Herbst, who has been urging the commission to lease space from the Kaplan building for months, told the Sun Sentinel he wants the police to be in a building large enough to suit their needs. But he says he’s not negotiating for the Kaplan building behind the scenes.
“I’m not acting as a go-between,” Herbst said. “At the end of the day, I am not here as a deal maker.”
Herbst, whose district includes the Cypress Creek Road area, says he has good reason for preferring the Kaplan building over its competitor.
“The other building is not a hurricane-rated building at all,” Herbst said.
The Kaplan building, on the other hand, has a new roof and windows made of impact glass that can withstand 120 mph winds, Herbst said.
The 20-year-old Kaplan building sits next to Fort Lauderdale Executive Airport on land owned by the city.
Four years ago, Sheldon Gross purchased a leasehold interest on the building and one next door for $36.5 million. At the time, Kaplan was the sole tenant in both buildings.
The lease on the building at 1515 W. Cypress Creek Road ends in 2073, Gross says. The building would revert to city ownership at that time.
On Friday, Herbst told the Sun Sentinel he believes Glassman was bringing up questions about whether the Kaplan building owed back taxes in an attempt to scuttle the deal.
“In an abundance of caution, Sheldon (Gross) sent the city additional language saying if there were back taxes owed, the city would not be responsible,” Herbst said. “That’s one more item the city attorney’s office has to review.”
On Aug. 22, city staff recommended the commission approve a lease with the 1901 building.
Herbst argued the Kaplan building had more space and was a better fit for the police.
In the end, commissioners tentatively approved a deal to lease space in the Kaplan building even though no lease had been drafted. The vote was 4-1, with Glassman dissenting.
This week, Glassman said he doesn’t like the idea of saddling taxpayers with an extra $470,000 a year to lease space at the Kaplan building.
“1515 looks to me like it’s $1.44 million a year,” he said during Tuesday’s commission meeting. “Plus 1901 has no security deposit. 1515 is asking for a $120,000 security deposit. I need someone to explain to me why we seem to be jumping through hoops, bending over backwards with 1515 when the 1901 (building) seems a much cleaner deal. No worries about leases. No worries about taxes. Someone needs to help me understand why we’re moving forward on this path.”
Susannah Bryan can be reached at email@example.com Follow me on X @Susannah_Bryan