Laura Street Trio in Trouble? Updated status of six key Downtown projects

[simms3]

I'll hand it to Atkins, he's very good at keeping this project in the news after years of no movement.

Yes.


Always hopeful for these two projects, but:

Bank of America tower sold last year for $88M

These two projects combined will cost at least $77M by estimates above


The article does a bad job at discussing sources and uses here.  It lumps in public sources with private equity, improperly.  Not sure exactly what kinds of tax credits are being used here, but that $77M may effectively be reduced by all or part of the public sources depending on their structure. 

Even so, 110 market rate units and a smaller Courtyard hotel with 131 keys above some commercial space, a restaurant, and a bodega for nearly the same price to buy Jacksonville's tallest, arguably most prestigious office tower is an imbalance that can only get worked out with a lot of public subsidies.

I would be for such subsidies WAYYYYYY before spending another dime on the NFL team/stadium, as I seem to be reading in the headlines now.  But  $77M is a very large sum of money for any project in Jax.  I believe 220 Riverside came in at < $40M for nearly 300 units, a garage, and a couple restaurants, and I believe that likely includes the land.  220 Riverside will get significantly higher rents than the 110 smaller units proposed for the Barnett Bank building.  As for the Courtyard by Marriott, 131 keys is terrifically small (Marriott's not on the hook for any of the development, but speaking for penciling out the development and eventually selling it...).  The kind of spend needed to rehab those buildings to a quality that Courtyard requires, above and beyond just being able to receive a certificate of occupancy from the city is ridiculous, to say the least.  And then what rates will they get?  The lowest in the country...Jax has basically the cheapest hotel rooms in the country and a market that has historically been overbuilt with terrible occupancy (hence all the woes with hotels downtown and everywhere all over the city).

I'm hopeful for a shit ton of cheap or free money to get this done (i.e. City please step up).

And Aundra Wallace and Jax chamber, how many trips are you going to take to Oklahoma City?  What are you trying to learn from that place?!?!  Whatever you've seen there yet to date, it's not like there's any evidence of it here, and why not just go to Portland OR or some other city?

[CCMjax]

Everyone who's been following this knows the city will have to subsidize a portion of it.  They need to subsidize that before subsidizing more at the stadium in my opinion.  The stadium stuff can wait if they can't do it at the same time.  One of the "Greatest Streets in America" isn't so great when you see the vacant shells of the Trio and Barnett.  It's kind of a joke.  We are talking about $12 million for the city to chip in to save its two most iconic historic buildings on its most iconic street?  That compared to $45 million for an amphitheater and practice field?  If Shad Khan really wanted that done now he would probably be willing to throw down more than half.  He has billions. 

[thelakelander]

No reason to compare the stadium stuff with the Trio. The money being identified for the stadium stuff can't be used to fund the Trio. You'll need another pot of cash.

[Tacachale]

No reason to compare the stadium stuff with the Trio. The money being identified for the stadium stuff can't be used to fund the Trio. You'll need another pot of cash.

Yep. Another thing is that obviously Khan's good for his share of the stadium projects. The Laura Street Trio needs to be airtight before the city commits to putting money toward that. It's an important project but the right folks need to be at the helm.

[edjax]

I think the city just may be a bit leary dealing with Mr. Atkins. 

[CCMjax]

I think the city just may be a bit leary dealing with Mr. Atkins.

I have wondered this as well.  Does he have a history?  I can't seem to find much other than a few project he was previously involved with.  Seems like a project more structured for a larger development outfit with more cash but I wish him the best of luck.

Since the stadium stuff and laura st are two different pots, and Khan already has some involvement with Barnett, maybe the city could negotiate with him in ways that would get his investment involvement in both if they help him with the stadium plans?  Not sure completely how all that public/private investment typically works but just a brainstorming thought.

[Apache]

I think the city just may be a bit leary dealing with Mr. Atkins.

I have wondered this as well.  Does he have a history?  I can't seem to find much other than a few project he was previously involved with.  Seems like a project more structured for a larger development outfit with more cash but I wish him the best of luck.

Since the stadium stuff and laura st are two different pots, and Khan already has some involvement with Barnett, maybe the city could negotiate with him in ways that would get his investment involvement in both if they help him with the stadium plans?  Not sure completely how all that public/private investment typically works but just a brainstorming thought.

I don't know him or his previous development history, but from reading his website, it looks like his core business is acquiring Tax Credits.

[marty904]

I don't know him or his previous development history, but from reading his website, it looks like his core business is acquiring Tax Credits.

You actually found a website for Southeast Group? I've searched high and low and have not been able to find an actual website for the company.  Would you mind sharing the link?

[Apache]

I don't know him or his previous development history, but from reading his website, it looks like his core business is acquiring Tax Credits.

You actually found a website for Southeast Group? I've searched high and low and have not been able to find an actual website for the company.  Would you mind sharing the link?

Oh no, not for Southeast Group. Pretty sure that entity was just created in '13 specifically for this project.

I was referring to the Urban Trust Capital site.

http://www.urbantrustcapital.com/

[RattlerGator]

No reason to compare the stadium stuff with the Trio. The money being identified for the stadium stuff can't be used to fund the Trio. You'll need another pot of cash.

Why do people on this board keep doing this? It's as if facts are irrelevant on this question.

[lowlyplanner]

Urban Trust Capital is a consultant on the project - they do specialize in helping developers make use of historic tax credits.  The way the IRS has written the rules makes it surprisingly difficult, particularly for large projects like this one...

The opportunity to get 20% of your rehab cost back is obviously very attractive, and often makes the difference between a viable project and no project.

[simms3]

No reason to compare the stadium stuff with the Trio. The money being identified for the stadium stuff can't be used to fund the Trio. You'll need another pot of cash.

Why do people on this board keep doing this? It's as if facts are irrelevant on this question.

Same bucket or different bucket, doesn't matter.  It's noticeable to all on this board how much money we do spend on certain things and how much money we don't spend on others.  Also noticeable that we do in fact spend a lot of money on a few things while also freaking out about the lack of money, budget issues, and a pending pension doomsday scenario.

Really can't ignore hypocrisy or these little facts.  Fact is somehow seemingly unlimited money is made available to the Jaguars (an organization already more capitalized than any other entity in the city - the last thing that absolutely needs more taxpayer money is in fact the Jaguars but alas it receives more taxpayer money than almost anything) but no money is made available to projects such as the Trio (would need chump change compared to the Jags, absolutely needs the money to work, and could in fact result in a more noticeable/positive change for the city than people realize).  Perhaps there is a middle ground that provides more level support for both.

I think I personally would be turned off less seeing more headlines about more $$$ going to the Jags if just one other thing in the city I'd like to see funded got funded.  The salt in my wound is the constant dog and pony show about how the city has no money (the city must have a whole publicly funded by taxpayer money endowment set up for the Jags then).  As someone already mentioned, Laura was recently named one of the 10 best streets in America.   (?)

[KenFSU]

New information coming tomorrow afternoon.  We have a breakfast meeting with the developer.

CAN'T WAIT.

[Tacachale]

I don't think the Trio is a matter of money. It's a matter of whether we can be sure the investment will pay off. This means that we have to be sure the proponents really can and will pull it off. We don't want to be in the position of putting $8 million into the project only to have it fail. It's an important project, but we've heard a lot of announcements for the last 4 years and still no movement.

[simms3]

I don't think the Trio is a matter of money. It's a matter of whether we can be sure the investment will pay off. This means that we have to be sure the proponents really can and will pull it off. We don't want to be in the position of putting $8 million into the project only to have it fail. It's an important project, but we've heard a lot of announcements for the last 4 years and still no movement.

I hear you.  And honestly, I'm skeptical, and this is also my own line of work, but I do believe that if priorities were on fixing downtown, there would be some acknowledgment that some money in the beginning is going to go down the drain.  DT Jax absolutely relies on public subsidy, and that notion.  It's so far gone no amount of private sector interest alone is going to bring it back.

But aren't the Jags kind of a sunk cost, and particularly unnecessary as they are so well capitalized as it is?  It's really a double standard.