The District wants $26 million in public incentives

[marcuscnelson]

If the deal is configured this way (ex. city buys land and builds most of the infrastructure), what's the point of Rummell's involvement?

Profiting.

[Noone]

Lets simplify this whole project.  It's 30 acres. That should hold 100 single family homes.  At $350,000 per home that puts $35,000,000 into the tax role, and a nice community could thrive there. You might be able to get more for a nice 3/2 with 2000 sf there. Add some community amenities like a pool, fitness center, riverwalk  and marina and it would sell out quickly.   A monthly HOA ( lets say $200) would be paid to JEA and provide income for the next 100 years ( in addition to the income from selling the parcel).   ($20,000 per month)

JEA needs to move on and stop pretending to be a real estate developer. 

This whole enterprise again illustrated why the RFP process is ridiculous.

Maybe I'm too greedy for wanting more than a glorified subdivision directly on our downtown riverbank, but I want more than a glorified subdivision. Obviously Rummell isn't panning out, but I'd think we should be able to at least get a decent bit of density.

Didn't Rummell's plan for The District include townhouses on a section of it already?

Yes, it includes townhomes. This proposed deal sounds like the city is buying the land and building the infrastructure, while Rummell serves as a master developer, essentially flipping individual parcels to other groups to construct individual projects that align with the master plan.

In other words, the city assumes the lionshare of the risk and Rummell gets all the profits.

+1

[thelakelander]

DIA approves paying up to $45 million in incentives to free District developers of the risk...

The District would have 1,170 residential units, 200 hotel rooms, 200,000 square feet of office space, 285,000 square feet of retail space, and a 125-slip marina. It also would extend the Southbank Riverwalk and have a public park on the riverfront. The total investment would be about $433 million, according to a DIA presentation to the board.

The city's would have a substantial financial role. It would pay up to $26.4 million for improvements that would be usable by the public. The city also would pay JEA, which currently owns the property, a total of about $18.6 million in annual installments through 2040. The city then would have Elements be the master developer.

The purchase of the land with payments stretching through 2040 would mark a significant change from JEA's original intent to sell the land in a straight transaction. Elements offered to buy the land for $18 million three years ago, but the deal never closed.

Full article: http://jacksonville.com/news/metro/2018-01-08/downtown-panel-wants-jea-shoulder-some-risk-district-development-deal

[thelakelander]

No, the school board building will still be there. DCPS is not involved in this.

[thelakelander]

More details. This thing could tie up the Southbank TIF in the same manner that has the Northbank TIF in the red:

https://www.jaxdailyrecord.com/article/amid-concerns-downtown-investment-authority-approves-deal-to-buy-land-proposed-for-the-district

[vicupstate]

While DIA unanimously approved the project, members said they wanted detailed answers about the structure of the deal, the financial ability of both the master developer and its potential partners to see the project to completion, and the use of funds from the Southside TID to pay JEA.

I realize they will  have a another vote on this eventually, but if JEA approves it, they will be under a lot of pressure to not kill the deal. If there is so much trepidation about this deal, they should have tabled it till the next time they could meet.

Is it a safe assumption that since this project is on the launch pad that the Shipyards is definitely on the back burner? I can't imagine anyone thinking this project and Shipyards could both happen simulataneously. 

[Tacachale]

Is it a safe assumption that since this project is on the launch pad that the Shipyards is definitely on the back burner? I can't imagine anyone thinking this project and Shipyards could both happen simulataneously. 

Other signs point to the Shipyards being on the backburner as well, at least for the time being. The hints dropped by the Mayor as well as the Jags about an entertainment district closer to the stadium for one, and tying of the development to removing the Hart Bridge ramps (which isn't happening soon) for two.

[Steve]

While DIA unanimously approved the project, members said they wanted detailed answers about the structure of the deal, the financial ability of both the master developer and its potential partners to see the project to completion, and the use of funds from the Southside TID to pay JEA.

I realize they will  have a another vote on this eventually, but if JEA approves it, they will be under a lot of pressure to not kill the deal. If there is so much trepidation about this deal, they should have tabled it till the next time they could meet.

Is it a safe assumption that since this project is on the launch pad that the Shipyards is definitely on the back burner? I can't imagine anyone thinking this project and Shipyards could both happen simulataneously. 

Normally, I'd agree about pressure. However, I don't think DIA will be under too much pressure in this case. Ultimately, JEA can only apply so much pressure. With City Council members questioning this whole thing the pressure would be less as I think this might have a hard time clearing Council anyway.

Now, with that said I don't fully understand this whole thing yet. I've read the articles posted here a couple times, but I need to read through this when I'm not multi-tasking here....this is a little complex.

[Tacachale]

While DIA unanimously approved the project, members said they wanted detailed answers about the structure of the deal, the financial ability of both the master developer and its potential partners to see the project to completion, and the use of funds from the Southside TID to pay JEA.

I realize they will  have a another vote on this eventually, but if JEA approves it, they will be under a lot of pressure to not kill the deal. If there is so much trepidation about this deal, they should have tabled it till the next time they could meet.

Is it a safe assumption that since this project is on the launch pad that the Shipyards is definitely on the back burner? I can't imagine anyone thinking this project and Shipyards could both happen simulataneously. 

Normally, I'd agree about pressure. However, I don't think DIA will be under too much pressure in this case. Ultimately, JEA can only apply so much pressure. With City Council members questioning this whole thing the pressure would be less as I think this might have a hard time clearing Council anyway.

The pressure will mostly come from the administration.

[KenFSU]

Now, with that said I don't fully understand this whole thing yet. I've read the articles posted here a couple times, but I need to read through this when I'm not multi-tasking here....this is a little complex.

I think it sounds slightly more complicated than it actually is.

Original plan was for Elements to purchase the property directly from JEA for $18.6 million, and then likely ask the city to provide $46 million in public infrastructure (utilities, roads, riverwalk extension, maybe public parkspace, etc.).

The new plan has Elements putting that same $18.6 million immediately toward public infrastructure, asking the city for $18.6 million less in infrastructure improvements ($26.4 million), and having the DIA purchase the land from JEA for $18.6 on a twenty-ish year loan, to be paid paid back annually using a 75/25 combination of revenue directly generated from the District and the Southbank TIF.

The actual numbers seem to be about the same.

On the surface, it seems like an iffy deal for JEA, but Elements also bid $6 million higher for the land than anyone else, so they'd likely see far less cash if the property went back to market.

What I actually kind of like about the new proposal is that, if everyone agrees that the District as imagined would be a huge net win for the southbank, it holds all parties responsible for doing their part to get shovels in the ground quickly and make the project a success.

In terms of the Shipyards, I think it's closer than people think. The only minor roadblocks standing in the way of the project breaking ground are:

1) The execution of a development agreement between Iguana and the city
2) The $90 million state-funded removal of the Hart Bridge Ramps, which isn't even in the FDOT's five-year plan.
3) The multi-year, $45 million+ remediation of the Shipyards Property, Met Park, and the area under the ramps, which the city hasn't even properly estimated, let alone contracted, yet.
4) The negotiation of a land swap for Metro Park, and the construction of a new park in-kind on said contaminated land
5) The completion of Berkman 2, which may or may not be structurally sound by this point.

No joke, wouldn't be surprised to see the Shipyards going vertical by March.

Kidding aside, though Lamping has said that the Shipyards will proceed with or without the removal of the Hart Bridge ramps, the mayor has a line item in this year's budget indicating removal is the long-term plan, and there's still no plan at all in place to begin environmental cleanup. Realistically, it's going to be a long time before this one breaks ground.

10-1 that Khan just continues piecemealing his original Shipyards plans in and around the stadium like he's done with Daily's Place. I bet the Cordish Jacksonville Live-ish entertainment complex, and potentially a hotel, break ground in the stadium district, opposite the Hart Bridge ramps, before we see any movement on the Shipyards proper.

Could see the Shipyards itself ending up mostly residential/office.

[thelakelander]

Originally, there were no public expectations of the city funding infrastructure for this development.

[MusicMan]

Thanks for the clarification Lake. I don't remember any promise from the COJ to provide $46 million in infrastructure support. Can KenFSU document that?

"While DIA unanimously approved the project, members said they wanted detailed answers about the structure of the deal, the financial ability of both the master developer and its potential partners to see the project to completion, and the use of funds from the Southside TID to pay JEA."

The catch phrase above is 'the financial ability of both the master developer and it's potential partners to see the project to completion'.....
Well so far they could not even close the original deal/bid they put forth, and have all the "partners" for this deal even been identified? 

Satisfying this particular set of issues seems damn near impossible to me.

[vicupstate]

What I actually kind of like about the new proposal is that, if everyone agrees that the District as imagined would be a huge net win for the southbank, it holds all parties responsible for doing their part to get shovels in the ground quickly and make the project a success.

Considering the city is one of those partners, and would be responsible for certain aspects only it could do, that statement should not be of any comfort to anyone. 

[KenFSU]

Thanks for the clarification Lake. I don't remember any promise from the COJ to provide $46 million in infrastructure support. Can KenFSU document that?

Shouldn't be a surprise, we've been talking about it since 2015:

https://www.metrojacksonville.com/forum/index.php?topic=23712.0

Sure, no concrete promises were ever made, no numbers were publicly specified (not to say they weren't discussed behind closed doors), but the final step was always going to be to negotiate a development agreement with the city. Do you really think anyone is going to commit to a 30-acre, $440 million riverfront development, on the Southbank, in 2018 Jacksonville, without public subsidy?

That's insane.

Particularly when, right across the river, the city was prepared to hand Shad Khan the Shipyards for free, pay $35 million for remediation, and build out the infrastructure along Bay Street, including riverwalk extension.

Atkins got an $8 million subsidy for the Trio and Barnett (~10% of project cost, similar to what we're talking above), including a similarly odd agreement involving the city paying for a parking garage and leasing it back to Atkins over the next couple decades, I believe.

The city just handed over nearly $10 million to Edward Waters College, of all places.

We ponied up $45 million for half of the $90 million in stadium improvements recently made to Everbank under the guise of splitting half the cost of an amphitheater with Shad Khan (reality check: we realistically got a $30 million amphitheater and subsidized the cost of the club upgrades and practice field). 

Cowford Chophouse? Subsidized (~10% project cost).

Carling and 11E? Subsidized.

It's the nature of the current downtown landscape.

Have zero problem with anyone thinking the benefit doesn't outweigh the cost, but surprise at the developer asking for public incentives? Come on. This ain't Manhattan, and the precedent has long since been set.

[thelakelander]

I'd pass. It's essentially the Southbank and San Marco. It's a completely different animal (market) from the Northbank and inner city neighborhoods like Brooklyn or even EWC. Might as well give East San Marco money. But I'm a guy that would pass on the Shipyards too. I also don't see $440 million being committed to that site anytime soon. No matter how the amount of incentives, the market is the market.