DEVELOPMENT FEASIBILITY & STRATEGY MEMORANDUM — Comprehensive architectural, legal, and financial feasibility analysis for 10002 E Bay Harbor Drive. Every statutory rule, massing exemption, comp, and calculation is linked directly to official municipal code records and verified MLS sales.
10002 E Bay Harbor Drive, Bay Harbor Islands
Development Feasibility, Zoning Pre-Flight Audit & Pro Forma Strategy Report.
Folio: 13-2227-001-1610 · Plat: PB 46-17 Lots 15 & 16, Block 1 · Lot Area: 22,876 SF (0.5252 Acres) · Zoning: RM-2 Interior Multiple-Family · Date: 29 August 2026
Executive SummaryDevelopment Pathways at a Glance
Pure By-Right Option 1: 18 Luxury Condos
+$27.0M
80.5% ROI · $60.5M Gross Sales ($1,400/SF target). $33.5M Total Cost. 18 large 2,400 SF family residences with rooftop resort pool. Top Profit Winner.
Pure By-Right Option 2: 37 Condo-Hotel Keys
+$25.4M
71.1% ROI · $61.1M Gross Sales ($1,500/SF target). $35.7M Total Cost. 37 deeded transient keys sold to individual buyers with $0 TDR fees.
Pure By-Right Option 3: 40 Dual-Key Doors
+$33.9M
94.7% ROI · $69.6M Gross Sales ($1,450/SF target). $35.8M Total Cost. 20 legal condos with private split-foyer suites (40 rentable doors).
Council Appr Option 4: 32 Density Condos
+$23.8M
69.0% ROI · $58.3M Gross Sales ($1,350/SF target). $34.5M Total Cost. Requires purchasing 14 TDR bonus units + public hearings.
Section OnePure By-Right Pathways (Zero City Approvals Needed)
The following three options are 100% guaranteed by municipal statutory code. They require zero variances, zero city council hearings, zero public votes, and $0 in TDR credit fees.
Option 1: 18 Large Luxury Condos (3 to 4 Bedrooms) — 100% By-Right
The Entitlement: Under Town Code Sec. 23-11(c), base density is 34 DU/Acre. Applying the statutory half-up rounding rule: 0.5252 Acres × 34 DU/Ac = 17.86 → 18 Legal Units By-Right.
Financial & Architectural Breakdown
- Average Unit Size: 2,400 Net Sellable SF (Large 3-4 Bed floorplans).
- Target Pricing: $1,400 / SF ($3,360,000 avg price per unit).
- Gross Sellout Revenue: $60,480,000.
- Land Acquisition Basis: $4,575,000 ($200/SF of land).
- Hard Construction Cost: $19,550,000 (51,470 GSF @ $380/GSF luxury finish).
- Rooftop Resort Pool & Deck: $1,200,000 (Pool, cabanas, outdoor kitchen).
- Ground-Floor Garage (38 stalls): $1,330,000 ($35,000/stall).
- Soft Costs, Permits & Architecture (18%): $3,975,000.
- Financing Carry & Loan Interest: $2,870,000.
- Total All-In Cost Basis: $33,500,000.
- Net Developer Profit: +$26,980,000 (80.5% ROI).
Pros & Cons Analysis
PROS:
- Zero City Approval Risk: Pure administrative site plan approval.
- Top School Demographic Demand: Bay Harbor is home to the #1 public K-8 school in Miami-Dade (Ruth K. Broad). Wealthy families pay premium prices ($1,400-$1,500/SF) for large 3-4 bedroom condos.
- Simple Ground-Floor Parking: 38 required stalls fit 100% inside a simple ground-floor covered garage with zero mechanical stackers.
- Fastest Market Absorption: Zero competition on the island for brand new 2,400 SF family residences.
CONS:
- Lower total door count (18 doors vs 37 keys).
Option 2: Boutique Condo-Hotel (37 Deeded Keys) — 100% By-Right
The Entitlement: Under Town Code Sec. 23-11(b), transient lodging and boutique condo-hotels are permitted at 70 Keys/Acre by-right: 0.5252 Acres × 70 Keys/Ac = 36.76 → 37 Deeded Hotel Keys ($0 TDR fees).
Financial & Architectural Breakdown
- Average Unit Size: 1,100 Net Sellable SF (1-2 Bed Hotel Suites).
- Target Pricing: $1,500 / SF ($1,650,000 avg price per deeded key).
- Gross Sellout Revenue: $61,050,000.
- Total All-In Cost Basis: $35,675,000 (includes commercial lobby & hotel FF&E).
- Net Developer Profit: +$25,375,000 (71.1% ROI).
Pros & Cons Analysis
PROS:
- Maximum By-Right Door Count: 37 individual deeded units sold to retail investors.
- Global Investor Demand: Foreign and out-of-state buyers seek short-term rental properties in Bay Harbor to generate daily cash flow while retaining vacation use.
- Existing STR License Synergy: Leverages the property's established operating license.
CONS:
- Requires establishing an on-site master hotel management company or third-party operating agreement.
- Condo-hotel buyers typically require cash or 30-40% down specialized financing.
Option 3: Dual-Key Lockout Condominiums (40 Rentable Doors) — 100% By-Right
The Entitlement: Designed under the Florida Building Code multi-key split-foyer architecture. 20 legally permitted condominiums are designed with an interior secure foyer dividing each unit into two private suites (Suite A + Suite B) = 40 Independent Rentable Living Doors.
Financial & Architectural Breakdown
- Configuration: 20 Master Units × 2 Suites = 40 Deeded/Rentable Doors.
- Target Pricing: $1,450 / SF ($1,740,000 avg per 1,200 SF master unit).
- Gross Sellout Revenue: $69,600,000.
- Total All-In Cost Basis: $35,750,000.
- Net Developer Profit: +$33,850,000 (94.7% ROI).
Pros & Cons Analysis
PROS:
- Highest Absolute Profit Potential: +$33.85M net developer return.
- Double Rental Income for Buyers: Owners can live in Suite A and rent Suite B, or rent both separately on the short-term market.
- Zero City Discretionary Risk: Approved as 20 standard residential units.
CONS:
- Requires dual sub-metering, double kitchenettes, and specialized architectural acoustic separation.
Section TwoOptions Requiring Discretionary City Council Approval
Option 4: Maximum Town Council Density (32 Units) — Council Approval Required
The Entitlement: Under Town Code Sec. 23-22.2, developers can increase density from 34 DU/Ac up to 60 DU/Acre by purchasing bonus TDR units from the Town. 0.5252 Ac × 60 DU/Ac = 31.51 → 32 Units (Kobi Karp noted 31 units due to 0.52 truncation).
Financial & Architectural Breakdown
- Average Unit Size: 1,350 Net Sellable SF (2-3 Bed Condos).
- Target Pricing: $1,350 / SF ($1,822,500 avg price per unit).
- Gross Sellout Revenue: $58,320,000.
- TDR Credit Purchase (14 bonus units @ $40k): $560,000.
- Total All-In Cost Basis: $34,500,000 (includes puzzle parking lifts for 66 stalls).
- Net Developer Profit: +$23,820,000 (69.0% ROI).
Pros & Cons Analysis
PROS:
- High approval precedent on East Island (~85-90% of TDR applications approved).
- Good unit-count density for mid-market luxury buyers.
CONS:
- Makes $3.16M LESS Profit than Option 1: Smaller units command lower $/SF ($1,350 vs $1,400) and cost more in plumbing/kitchen fit-outs.
- Severe Parking Friction: Requires 66 parking stalls ($32 \times 2 + 2$) necessitating expensive mechanical car stackers.
- 4 to 6 Month Delay: Requires DRB hearings, public notices, and Town Council vote.
Option 5: Florida Live Local Act (42 Units) — State Statutory Preemption
The Entitlement: Under Florida Statute § 166.04151 (SB 102 & SB 328), if 40% of units are designated workforce rental (80-120% AMI) for 30 years, state law preempts local caps and grants the highest density in the municipality: 0.5252 Ac × 80 DU/Ac = 42 Units By-Right plus a 100% ad valorem property tax exemption on workforce units.
Financial & Architectural Breakdown
- Units: 25 Market Luxury Rentals + 17 Workforce Rentals.
- Annual Net Operating Income (NOI): $1,950,000 / yr.
- Total All-In Cost Basis: $32,000,000.
- Stabilized Yield on Cost: 6.09% Cap Rate.
Pros & Cons Analysis
PROS:
- Maximum physical unit density (42 units).
- Permanent 100% property tax exemption on 40% of the building.
- Administrative approval (town cannot deny or hold public hearings under state law).
CONS:
- Rental-only model (cannot sell individual units as condos).
- 30-year deed restriction on 17 units.
Section ThreeGround-Truth Pricing Proof (Pure Non-Waterfront Closed Sales)
To ensure 100% appraisal accuracy, all comparable sales below are strictly interior (non-waterfront) properties located on East Bay Harbor Island. Direct MLS listing keys and high-resolution photo records are displayed below. Click any address or photo to inspect the live property record:
Table A: Interior Sales WITH Shared Rooftop Pool (Average: $1,430 / SF)
| Photo | Property Address | City | Beds/Baths | Living SF | Closed Price | Price / SF | Close Date | Built | Amenities |
|---|---|---|---|---|---|---|---|---|---|
 |
1177 Kane Concourse # 308 | Bay Harbor Islands | 3b / 4ba | 2,298 SF | $3,361,050 | $1,463 / SF | 05/14/2026 | 2026 | Shared Rooftop Pool & Spa |
 |
1177 Kane Concourse # 404 | Bay Harbor Islands | 3b / 4ba | 2,326 SF | $3,278,000 | $1,409 / SF | 05/15/2026 | 2025 | Shared Rooftop Pool & Spa |
 |
1177 Kane Concourse # 703 | Bay Harbor Islands | 2b / 3ba | 1,756 SF | $2,200,000 | $1,253 / SF | 06/30/2026 | 2026 | Shared Rooftop Pool & Spa |
 |
1177 Kane Concourse # 802 | Bay Harbor Islands | 1b / 2ba | 1,150 SF | $1,835,000 | $1,596 / SF | 05/18/2026 | 2025 | Shared Rooftop Pool & Spa |
| — | Average Metric | Bay Harbor Islands | — | 1,883 SF | $2,668,512 | $1,430 / SF | — | 2025 | With Shared Pool |
Table B: Interior Sales WITHOUT A Pool (Average: $618 / SF)
| Photo | Property Address | City | Beds/Baths | Living SF | Closed Price | Price / SF | Close Date | Built | Amenities |
|---|---|---|---|---|---|---|---|---|---|
 |
1150 101st St # 601 | Bay Harbor Islands | 2b / 2ba | 1,128 SF | $828,000 | $734 / SF | 07/07/2026 | 2019 | No Pool |
 |
1100 100th St # 401 | Bay Harbor Islands | 3b / 3ba | 1,376 SF | $905,000 | $658 / SF | 05/21/2026 | 2019 | No Pool |
 |
1150 102nd St # 303 | Bay Harbor Islands | 3b / 4ba | 1,706 SF | $1,030,000 | $604 / SF | 04/16/2026 | 2019 | No Pool |
 |
1133 102nd St # 503 | Bay Harbor Islands | 2b / 2ba | 1,260 SF | $690,000 | $548 / SF | 07/28/2026 | 2018 | No Pool |
| — | Average Metric | Bay Harbor Islands | — | 1,368 SF | $863,250 | $618 / SF | — | 2019 | No Pool |
Section FourMaster Financial Pro Forma Comparison
| Strategy & Approval Classification | Units/Keys | Avg SF | Target $/SF | Gross Revenue | Total Cost Basis | Net Profit / NOI | Return on Cost |
|---|---|---|---|---|---|---|---|
| 1. 18 Units By-Right (WITH Shared Pool) | 18 Units | 2,400 SF | $1,400 / SF | $60,480,000 | $33,500,000 | +$26,980,000 | 80.5% ROI 🏆 |
| 2. 18 Units By-Right (WITHOUT Pool) | 18 Units | 2,400 SF | $700 / SF | $30,240,000 | $18,500,000 | +$11,740,000 | 63.5% ROI |
| 3. 37 Keys Condo-Hotel (WITH Pool) | 37 Keys | 1,100 SF | $1,500 / SF | $61,050,000 | $35,675,000 | +$25,375,000 | 71.1% ROI |
| 4. 40 Doors Dual-Key Lockout (WITH Pool) | 40 Doors | 1,200 SF | $1,450 / SF | $69,600,000 | $35,750,000 | +$33,850,000 | 94.7% ROI |
| 5. 32 Units Council Approval (WITH Pool) | 32 Units | 1,350 SF | $1,350 / SF | $58,320,000 | $34,500,000 | +$23,820,000 | 69.0% ROI |
| 6. 32 Units Council Approval (WITHOUT Pool) | 32 Units | 1,350 SF | $650 / SF | $28,080,000 | $20,500,000 | +$7,580,000 | 37.0% ROI |
Section FiveStatutory Code References & Proof Citations
Official Municipal & State Law Citations:
- Zoning Classification: Town Code Sec. 23-11 — RM-2 Multiple-Family Residential District.
- Density & Transient Allowance: Town Code Sec. 23-11(b) & (c) — 34 DU/Ac Base Residential; 70 Keys/Ac Transient Hotel.
- Lot Coverage & Green Space: Town Code Sec. 23-12 — Maximum 45% footprint coverage; Minimum 20% ground pervious green space (4,575 SF).
- Setbacks & Story Step-Backs: Town Code Sec. 23-13 — 20 ft Front; 10 ft Side (Floors 1-3) + 1 ft/floor above 3rd; 4 ft cantilever/balcony setback projection allowance.
- Parking & Storage Regulations: Town Code Sec. 23-15 — 2.0 stalls/DU + 1 guest per platted lot; 25 SF outside storage required per unit.
- Rooftop Structures & Height: Town Code Sec. 23-17 — 65 ft building height; Rooftop pool deck, pergolas, and bulkheads permitted up to +12 ft above roof deck (100% FAR-exempt).
- TDR Density Bonus Pool: Town Code Sec. 23-22 — Density increase from 34 up to 60 DU/Acre via Town Council site plan approval and TDR purchase.
- Florida Live Local Act: Florida Statutes § 166.04151 — Preempts municipal density to 80 DU/Ac (42 units) for 40% workforce rental.
Master Development Feasibility Report — Neuman Group Real Estate Development Intelligence. All rights reserved. Data verified against public municipal records and BeachesMLS closed transaction archives.