Terra Partners with Jungle Island Owner for Residential Redevelopment on Watson Island

Aerial photo Watson Island Miami Beach circa 2023

David Martin’s Terra is teaming up with the owner of Jungle Island to redevelop a portion of the city-owned site into a residential project, The Real Deal has learned.

The project’s approval hinges on a voter referendum, potentially taking place later this year. Sources informed TRD that if the project proceeds, Jungle Island, a waterfront eco-adventure park on Miami’s Watson Island, would close.

In 2018, ESJ Capital Partners, an Aventura-based firm led by founder and CEO Arnaud Sitbon, secured voter approval to amend the city charter. This amendment allowed ESJ to modify its lease to build a hotel, introduce new attractions at Jungle Island, and expand retail, restaurant, and meeting spaces. The proposed hotel had a maximum height of 130 feet.

In 2021, the Miami City Commission approved a development agreement and a unique area plan (SAP) with Jungle Island, including a land use change to permit commercial development. SAPs apply to projects covering at least nine acres.

ESJ faced a 2023 deadline to obtain a building permit, a requirement that would trigger $250,000 annual rent payments to the city. Upon completion of the planned hotel, this payment would increase to $1.2 million annually plus 5 percent of gross revenue.

However, ESJ has yet to advance with the hotel project. Recently, the firm engaged in discussions with local developers to build a for-sale residential project on the site, eventually securing a partnership with Coconut Grove-based Terra, according to sources.

The developers need to own the land where the condo will be built to construct a condo on the 18-plus-acre site at 1111 Parrot Jungle Trail. According to a statement from ESJ and Terra, ESJ has been negotiating with the city to return nearly 13 acres for a waterfront public park in exchange for purchasing 5 acres for the residential project.

ESJ and Terra stated that their plan would “return most of Jungle Island to the community as a public asset for all to enjoy free of charge” while generating city revenue through property taxes from condo sales. They also noted that their proposal would create less traffic than previously approved plans.

ESJ acquired Jungle Island for $60 million in 2017, assuming the lease with the city of Miami and park debt owed to Miami-Dade County and the U.S. Department of Housing and Urban Development. Bern Levine, who owned Jungle Island (formerly Parrot Jungle) since 1988, sold the theme park seven years ago after relocating it to Watson Island from Pinecrest in 2003.

Watson Island, positioned between Miami’s mainland and Miami Beach, is also the site of another significant project. Last year, Merrimac Ventures and BH3 Management partnered to take over the lease for nearly 11 acres on the island’s west side. The previous developer, Mehmet Bayraktar’s Flagstone Property Group, encountered years of delays and litigation with the city. Voters had approved Bayraktar’s project in a 2001 referendum, but only the mega yacht marina was completed, with plans for luxury hotels, retail, public space, and a garage left unfinished.

Any substantial changes to Merrimac and BH3’s plan would require voter approval through another referendum.