Downtown Melbourne undergoing skyline-shaping growth boom, despite COVID-19 pandemic

More than $70 million in high-profile commercial and housing construction is reshaping the historic district

Cari Ann Bisset, catering sales manager at The Landing Rooftop, stands on an 11th-floor outdoor terrace atop Hotel Melby. In the background at left is the Highline apartment complex. TIM SHORTT/ FLORIDA TODAY (Florida Today)

MELBOURNE, Fla. – By the end of March 2020, Florida’s COVID-19 restrictions had largely reduced downtown Melbourne to a ghost town — and 68% of Melbourne Regional Chamber poll respondents didn’t think they could afford to operate another month with no new sales, according to News 6 partner Florida Today.

Only one year later, workers are applying finishing touches to The Landing Rooftop, the restaurant-lounge-event venue atop Hotel Melby. Rattan chairs circle the fire pit amid palm trees on the breezy outdoor terrace, and employees are undergoing training sessions this week.

The Landing Rooftop opens to the general public on April 8 for dinner and evening cocktails during its first week, said Cari Ann Bisset, catering sales manager. Hotel Melby also opens on April 8. The $42 million Tapestry Collection by Hilton boutique hotel — which city officials have labeled “a game-changer” — is projected to inject $8.8 million into the surrounding area per year, excluding lodging costs.

Eleven stories below The Landing Rooftop, downtown Melbourne’s economy has proven surprisingly resilient throughout the COVID-19 pandemic. In fact, more than $70 million in high-profile commercial and housing construction is reshaping the historic district:

  • Hotel Melby was constructed atop a former city-owned asphalt parking lot on Strawbridge Avenue. Groundbreaking occurred in July 2019.
  • The $31 million, eight-story Highline apartment complex opened to tenants in August amid the pandemic. About 80%of the 171 studio, one- and two-bedroom apartments are leased, exceeding expectations. Rents range from $1,289 to $2,700 per month.
  • Meg O’Malley’s Restaurant & Irish Pub, a downtown anchor business shuttered since the dawn of the pandemic, may re-open by early May after undergoing extensive renovations.
  • Crews are remodeling Ember & Oak and building the resurrected County Line Saloon, two of the historic downtown’s larger venues.

That said, the COVID-19 pandemic has taken a heavy fiscal toll and triggered layoffs and furloughs at many downtown restaurants and retailers — some of which remain closed on Sundays and Mondays.

And despite downtown building growth, City Hall officials are still grappling with panhandling, homelessness and aging infrastructure — issues that have persisted for decades.

“The next phase, I’m sure, will be a gradual change in some of the retail and restaurant and entertainment places that are down here,” Highline developer Sam Zimmerman said during a 321 Millennials meeting March 5 at his apartment complex.

“Inevitably, there will be greater demand for this space,” Zimmerman said, addressing the group near the second-story poolside fire pit.

“New Haven Avenue’s going to up its game. It’s just inevitable,” he said.

“It’s a place that is on a tremendous — and I would say inevitable — upward trajectory.”

Melbourne Main Street Executive Director Kim Agee started her job roughly six weeks before the pandemic struck. She said only a handful of downtown businesses went under because of COVID-19, and “we’ve actually had tons of new businesses move in — it’s kind of crazy.”

Why? Agee credited close proximity to Orlando Melbourne International Airport and an apartment housing boom in surrounding Melbourne, West Melbourne and Palm Bay.

As the crow flies, the Orlando Melbourne International Airport passenger terminal lies less than 2 miles from Meg O’Malley’s.

More than 20,000 people work on airport property during weekdays: think Northrop Grumman, L3Harris, Embraer Executive Jets, Collins Aerospace, STS Mod Center, Thales, GE Transportation, Southeast Aerospace, Satcom Direct and Avidyne Corp.

The airport generates an estimated economic impact of nearly $3 billion per year. In February, the Milken Institute ranked the Palm Bay/Melbourne/Titusville metropolitan area No. 2 in the nation for economic growth — and the airport is a key driver.

What’s more, Aerion Supersonic is building a $375 million global headquarters at the airport, with plans to start manufacturing business jets by 2023. The company’s order backlog for supersonic planes has surpassed $10 billion. And projected employment may reach 675 workers by 2026.

During an April 2020 news conference amid COVID-19 shutdowns, Florida Gov. Ron DeSantis said these Aerion jobs will pay an average of $105,000 per year.

That’s a clientele downtown businesses seek.

Recent downtown business grand openings include Fiesta Bar & Grill (Feb. 26), the furniture store Vintage Mimosa (March 4), and Let’s Plant It! (March 13). Glitter Alley and Essential Elements Wellness are expanding into adjacent storefronts, and Agee said there are “very few” vacancies along New Haven Avenue.

During the 321 Millennials meeting at Highline, Agee said a new wave of housing is bolstering the New Haven Avenue commercial district.

In February 2020 — one month before COVID-19 rattled Florida’s economy — Melbourne Main Street officials tracked 11 Melbourne, West Melbourne and Palm Bay apartment complexes that had opened, were under construction or were planned within 6 miles of downtown. Total number of apartments: 3,897.

“Where are those people going? They’re coming here,” Agee said.

In February, a FLORIDA TODAY public records request revealed that a national developer wants to build a six-story apartment building, five-story apartment building and four-level parking garage at the aging Orange Court Apartments site — generating chatter downtown.

North American Properties proposes to build at least 197 apartments at the 2-acre property, near the intersection of Melbourne Avenue and Melbourne Court and next to Holmes Park. This downtown complex was not included in Melbourne Main Street’s list.

Naomi Mirsky is managing principal of Willow Street Capital, the Miami-based firm that built Hotel Melby. She said they targeted downtown Melbourne years ago after a risk analysis showed the local hotel market had historically fared “extremely well” during economic downturns.

Why? Mirsky cited the blend of business travelers and tourists, along with a diverse, stable mix of nearby businesses and low supply of hotel rooms. For example, she said Melbourne hotels fare better during recessions than Orlando-area hotels that rely on Walt Disney World visitors.

“There’s a high demand. There’s a lot of business in the area, and it keeps coming. We’ve got a lot of new openings. We’ve got TUI,” Mirsky said.

TUI, the United Kingdom’s leading holiday travel conglomerate, will start flying an estimated 156,000 trans-Atlantic passengers to the airport every year, starting in spring 2022.

A boost in tourist traffic would help Melbourne’s downtown restaurants and retail shops recover.

“We have so many offices and office buildings that are close to here. And when people went home (to work remotely), they weren’t coming in for lunch,” Agee told the 321 Millennials.

“They weren’t coming in for drinks. They’re not coming in for dinner at happy hour: ‘Oh, I’ll swing downtown because it’s on my way home’ " Agee said.

After operating Matt’s Tropical Grill beachside from 1994-2004, Matt Nugnes opened Matt’s Casbah in 2008 inside the former New Haven Avenue brick gas station that once housed the Pop’s Casbah diner.

The coronavirus pandemic slammed Matt’s Casbah register receipts, forcing Nugnes to pare back his menu, eliminate dishes that cost $35 and up, and shut down Sundays and Mondays.

“50% is an understatement,” Nugnes said of his coronavirus losses.

“Just because you were open and allowed to seat 50% doesn’t mean you can even potentially cover your bills. As an owner and a chef, I put my apron on and I’m back in the kitchen. That’s the only way this is going to work,” he said.

Matt’s Casbah used to employ about 50 people and open seven days per week. Nugnes now employs about 30 workers and opens five days per week. However, he said his restaurant now operates more efficiently: “We’re actually showing better than pre-COVID numbers.”

He looks forward to Hotel Melby opening a block away.

“That thing’s going to do things for downtown that downtown hasn’t even realized yet,” Nugnes said.

Mayor Paul Alfrey has announced plans to conduct a Melbourne City Council special meeting on May 4 seeking “outside-the-box” solutions to combat panhandling and homelessness. In a Tuesday Facebook post, he said both are on the rise, generating complaints.

William Miller, a downtown resident, said homeless people are squatting in a wooded lot off Melbourne Avenue — and he fears they might ignite fires that could threaten nearby homes.

“You don’t see this on beachside. You don’t see it in Vero. We see it in downtown,” Miller said during the March 23 City Council meeting.

“We need to find out what we’re missing and solve this problem. It’s a safety problem. It’s a health problem,” Miller said.

“I can’t enjoy my property without feeling threatened by these meatheads,” he said.

The upcoming special meeting will also discuss ways the city helps homeless people find jobs and housing, Alfrey said on Facebook. Vice Mayor Tim Thomas said panhandling may be on the rise because of the COVID-19 pandemic — particularly among young people.

Downtown parking remains a perennial problem. Long-term, City Hall officials may have to consider building another parking garage, Economic Development Manager Doug Dombroski told the Downtown Redevelopment Advisory Committee on March 5.

Dombroski said the New Haven Avenue streetscaping that extends from the post office to U.S. 1 dates to the late 1980s and early ’90s. Sidewalks are narrow, and tree roots pull up asphalt and pavers. He said more than $70,000 in redevelopment funding is budgeted to address those issues.

Agree told the committee she has received comments about poor downtown lighting and lack of safety after dark. Regarding sidewalks, she said a pedestrian tripped, fell and broke her ankle in late February between Vernon and Waverly places.

Committee member Lisa Herendeen shared a similar experience: She took a tumble after tripping over bricks one night while walking her dog along New Haven Avenue.

“It’s not fun,” Herendeen said.

In February, the Melbourne City Council unanimously approved development of Alligator Reef Bar & Grille, a future beachy-themed bar featuring an outdoor deck, food truck, fire pit and maximum occupancy of 80 people.

Alligator Reef Bar & Grille will occupy a former residential home at 614 E. New Haven Ave. that was last leased as a real estate office. However, residents in the pink quadplex next door lobbied unsuccessfully against the project — fearing increased noise, blockage of their shared driveway, loitering and late-night safety risks.

Council Member Mark LaRusso served two terms from 2004-12, then won election again in 2018. He recalled how his first 2004 vote — alongside the late mayor Harry Goode and past mayor Kathy Meehan — extended downtown open-container hours from 9:30 p.m. to midnight during special events.

“Half of Melbourne downtown was shuttered,” LaRusso said during the Feb. 9 Alligator Reef Bar & Grille discussion.

“We decided as we moved forward that downtown Melbourne, in order to rejuvenate, was going to be an entertainment and dining location from stem to stern,” LaRusso said.

“So over 17 years, it’s changed. More residential. More things that challenge us,” he said.