Exclusive: Developer claims political revenge in project rejection


Developer Michael McCloskey says he went to City Commissioner Keith James seeking support for a multimillion-dollar downtown project and instead got a profanity-laced tirade in which James said he’d never support the project because the developer supported his and the mayor’s opponents.

McCloskey, who has been seeking city support for the 500,000-square-foot Health and Wellness Campus for two years, said he met with James in the commissioner’s City Hall office at 2:30 p.m. Monday, to update him on the project and enlist his support. That’s not how it worked out, the developer said Wednesday in an interview with The Palm Beach Post Editorial Board.

McCloskey said that after he finished the update James told him:

“Are you through? What f******* universe do you live in? Really? What f****** universe do you live in that you think that after how you behaved during the election, raising as much money as you did for my opponent, running around with Kimberly (Mitchell) and Jessica (Pinsky) that you could come in my office and ask for my support of your project?”

Mitchell, a longtime city commissioner, stepped down to run against Mayor Jeri Muoio, a James ally. Pinsky and her husband, political consultant Richard Pinsky, were active in Mitchell’s campaign.

“If you had a golden goose that was laying golden eggs up and down Okeechobee Boulevard, I wouldn’t vote for the project,” James allegedly told the developer. “Now get the f*** out of my office. And you can quote me on that.”

McCloskey said he would be willing to testify under oath that James said that, verbatim.

James said his recollection is “vastly different.”

“I don’t recall making those statements like that,” the commissioner said, adding that he had concerns about the project price and incentives from the start.

“You’ve got a developer who must be seeing the life of his project flash before his eyes. He’s not happy with seeing Keith James elected. … I think he’s got a bone to pick with me.”

James, 57, a Harvard Law graduate and a commissioner since 2011, handily won re-election, as did Muoio.

“To me it’s a little bit curious: Running to the press to talk about a private meeting and somehow throwing me under the bus before the vote,” James said. “I can’t figure this out. It’s a mystery to me why Mr. McCloskey would go to this extent.”

John Carey, Palm Beach County inspector general, said upon hearing of McCloskey’s account that he wants to evaluate it and submit it to the county Commission on Ethics for evaluation, “and consider what, if any, actions either one of our offices might take, or should take.”

“It’s disturbing to hear things like that,” Carey said.

Former Commissioner Mitchell, who had supported McCloskey’s project, said Wednesday she found his account of the meeting credible.

“It’s not his office, it’s the people’s office and you’re there to do the work for them,” Mitchell said of James. “Your work is to make the best decision based on the facts for the people of West Palm Beach. Period.”

McCloskey proposed the medical project to the city on May 9, 2013, hoping to build on what is known as the “tent site,” at Okeechobee Boulevard and South Dixie Highway. The city had taken back the site a few months earlier from the developer of the failed Digital Domain animation studio project.

The project includes as prospective tenants nonhospital medical facilities run by Jupiter Medical Center, Miami Children’s Hospital, Caron addiction treatment center and New York’s Mount Sinai Medical Center, as well as The Fresh Market grocery.

James has voted for or against the project at various stages.

At a meeting on May 13, 2013, James and the Community Redevelopment Agency — a board made up of the city commissioners — decided not to put the project out for a request for proposals. “Let’s strike while the iron is hot,” McCloskey recalled James saying.

He voted against moving ahead with the project in July 2014. “I said I want to go out to a full-blown request for proposals,” James recalled.

But in October of that year, he voted with the majority when the agency approved a term sheet with the general outline of the project.

At that point, city staff put out a public notice of the city’s intention to sell the property, allowing 30 days for any other developer to propose an alternative project. When no alternatives arose, the city and developer were to hammer out a final development agreement within 60 days.

The deal was for the developer to buy the site for $13.5 million. As an incentive for job creation, up to $8.5 million would be reduced from that amount to be given through the developer to companies that moved into the project, at $25,000 a job.

Muoio, however, objected to the incentives, telling McCloskey she didn’t want that money going to him but directly to the companies. Last month, he said, though the money was intended to go to the companies all along, he told the city he would agree to eliminate the incentives altogether from his proposal. “So now it’s a straight-out purchase of land,” he said Wednesday.

But at an April 23 agenda review meeting of the City Commission, he said, there was no discussion of his new terms. Instead, the focus was on the mayor’s decision to publicly request new proposals for the property.

The proposal comes before the CRA again on Monday.

James said he continues to have doubts about the project and is concerned about the developer’s “financial wherewithal.” Not enough information has been presented to agency on that, he said.

The developer lists as his financial partner Mount Kellett, a $7 billion private-equity firm.

According to city spokesman Elliot Cohen, city staff will present the McCloskey project to the agency as the best deal they could arrange within the parameters set by the board. But staff also will say that it’s not the best deal possible, because without putting it out as a public request for proposals, they don’t have alternatives to weigh.

Muoio was out of town Wednesday and said through Cohen that she would let James speak for himself on the matter. Muoio has been consistent in wanting to request outside proposals, Cohen said.

Muoio was on the board of directors of St. Mary’s Medical Center for six years, until March 31, when her second term there expired. St. Mary’s and Good Samaritan Medical Center have strongly opposed the downtown medical campus proposal. McCloskey noted that she failed to disclose that early on, when the project was first presented, but she has denied any impropriety.

McCloskey said neither West Palm hospital has returned his calls.

He said Wednesday that there were months in which competitors could have proposed alternatives but didn’t.

“I thought we were bringing something terrific,” McCloskey said of the medical campus concept. “We’re kind of shaking our heads, saying, ‘Now what’s the problem?’”

As for his encounter with James, McCloskey said in 25 years as a developer in West Palm Beach, he’d never heard a private citizen say anything like that to him, let alone a public official. “A city commissioner. In City Hall. To a taxpayer.”



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