COJ and UF take first major step towards LaVilla campus

[marcuscnelson]

What if Gateway just leased the Interline buildings until UF built their permanent ones?

UF rejected this idea.

Weren't interested in a lease.

A little surprising, given they seemed poised to lease space in the JEA building initially.

Why not?  Do they feel they need to own those parcels down the line?  If not, what is wrong with leasing?  Sometimes, decisions need to be made made on reasonable options available... we don't always get exactly what we want, especially if other options could work and the asking party doesn't have full leverage.

The last time someone told UF that they abandoned West Palm Beach.

[Tacachale]

What if Gateway just leased the Interline buildings until UF built their permanent ones?

UF rejected this idea.

Weren't interested in a lease.

Why not?  Do they feel they need to own those parcels down the line?  If not, what is wrong with leasing?  Sometimes, decisions need to be made made on reasonable options available... we don't always get exactly what we want, especially if other options could work and the asking party doesn't have full leverage.

There's nothing wrong with renting, in fact UF is doing that now at the JEA building. They want to get started on the campus immediately, which in a town known for not striking fast enough while the iron's hot, is a great thing. This is the only available building in the campus area, so it's the solution.

[jaxlongtimer]

What if Gateway just leased the Interline buildings until UF built their permanent ones?

UF rejected this idea.

Weren't interested in a lease.

Why not?  Do they feel they need to own those parcels down the line?  If not, what is wrong with leasing?  Sometimes, decisions need to be made made on reasonable options available... we don't always get exactly what we want, especially if other options could work and the asking party doesn't have full leverage.

There's nothing wrong with renting, in fact UF is doing that now at the JEA building. They want to get started on the campus immediately, which in a town known for not striking fast enough while the iron's hot, is a great thing. This is the only available building in the campus area, so it's the solution.

We get they want the Interline building to move fast.  But, that still doesn't explain why leasing isn't an option that would meet that requirement.  Do they see these buildings as a permanent part of the ultimate campus or can they live without them once the permanent buildings are built?

[Tacachale]

What if Gateway just leased the Interline buildings until UF built their permanent ones?

UF rejected this idea.

Weren't interested in a lease.

Why not?  Do they feel they need to own those parcels down the line?  If not, what is wrong with leasing?  Sometimes, decisions need to be made made on reasonable options available... we don't always get exactly what we want, especially if other options could work and the asking party doesn't have full leverage.

There's nothing wrong with renting, in fact UF is doing that now at the JEA building. They want to get started on the campus immediately, which in a town known for not striking fast enough while the iron's hot, is a great thing. This is the only available building in the campus area, so it's the solution.

We get they want the Interline building to move fast.  But, that still doesn't explain why leasing isn't an option that would meet that requirement.  Do they see these buildings as a permanent part of the ultimate campus or can they live without them once the permanent buildings are built?

This'll be a permanent part of the campus. It'll be a few years before other buildings can be constructed, and they have ambitious plans for the programs. The project will be done in phases, with benchmarks between them.

[Jax_Developer]

The price tag to purchase the Interline building will balloon if UF does in fact invest hundreds of millions in such a tight proximity. Hence, from UF's perspective, why lease something today that you know you are going to buy tomorrow for more?

I don't think anyone for a second believes the UF property is worth the same as the Riverfront parcels... But at this point, the city has invested hundreds of millions downtown & we need something to show for it. UF is the best chance for that (outside $$ coming in) so I really don't see the holdup over the land valuations. The city isn't hurting for DT land lol and the increased tax income should mean something in the equation.

[CityLife]

If I was a council person, I would like to have current and independent appraisals of Interline and each Riverfront Parcel before making any kind of land swap. Take all of the entities involved and their prospective plans to improve Downtown out of the equation and imagine that COJ was making a land swap elsewhere Downtown without having a current appraisal of the properties involved.

That said, this is a unique situation and there seems to be a fairly simple solution to the deal that protects all parties. In UF's land swap with COJ, they have to complete construction on parcel A and start construction on Parcel B before commencing any work on the Prime Osborn. COJ could structure the Riverfront parcels/Interline land swap similarly, but instead tie it to the development of Gateway Jax. Gateway appears to be getting a favorable deal here to open the door for UF, but presumably also because of their other plans downtown. So give Gateway one of the parcels directly for the Interline Building and allow them to have the other parcel for free once they have hit certain benchmarks for Gateway (similar to the Prime Osborn deal). As a very small carrot/olive branch to Gateway for this deal, it would keep them from paying property taxes on one of the Riverfront parcels for a period of time.

As with the revised Laura Street Trio deal, there are probably 20 different ways to structure a deal that protects all the parties and ensures benchmarks are met.

[CityLife]

Following up on my above post, it looks like the DIA does not have to follow the typical land disposition process used elsewhere in COJ:

https://library.municode.com/fl/jacksonville/codes/code_of_ordinances/422374?nodeId=TITVADPE_CH122PUPR_PT4REPR_SPCCOREREPRDI

Boyer argued the two pieces on and near Riverfront Plaza are closer in value to the vacant Interline building than it might first appear.

One site is about 1 acre and sits in the northeast corner of Riverfront Plaza – a spot a previous developer had envisioned would house a high-rise. The other site served as a parking lot for the former Landing just east of the plaza and is partially covered by the Main Street bridge off ramps. That location is larger but, Boyer argued, is “considerably less desirable due to the (Main Street) bridge ramps and utility encumbrances,” which drives down the value.

Together, Boyer estimated both pieces of land are worth a combined $4.3 million to $5.6 million.

But that is considerably lower than previous estimates of those sites’ value outlined in prior development agreements and other city records. In 2007, for example, Toney Sleiman, the former owner of the Landing, agreed to pay the city $4.7 million for the east parking lot site, a price based on a 2006 appraisal, according to legal filings. In its effort to force Sleiman out of the Landing so it could be demolished, the city paid him back a portion of that sale price in 2019.

Last year, a proposed term sheet from a previous developer – which the DIA never advanced – estimated the east parking lot to be worth about $6.3 million.

In 2022, the DIA estimated the 1-acre site at Riverfront Plaza was worth $3.4 million.

Together, that would put the high-end estimate of the sites’ value near $10 million.

Boyer argued that the land swap would obligate Gateway to build certain elements into its development, like a hotel, that restricts the land’s value.

Gateway purchased the Interline building for $4 million, but its owners – and Boyer – argue it’s worth significantly more, somewhere between about $5.5 million to as much as $9 million. Arguing that the building has “development potential,” Gateway has advanced the higher end of that range, although the DIA said in a report it takes some “exception” to “values included in that appraisal.”

It’s not clear if the DIA’s estimates of the riverfront sites’ value included their “development potential.”

In sum, Boyer said she did not view the land swap as an incentive provided to Gateway because the trade would result in the city “receiving fair market value” for its two properties.

Boyer also said she anticipates that, if the land swap is approved, Gateway would ask for incentives to support its future development plans along the water.

It seems like Boyer is grasping at straws a bit here, but it does have to be extremely difficult to conduct appraisals on all the properties at play given the current and anticipated projects near them. Should the present value of the Interline building include the potential increase in value due to proximity of UF's new campus, if the UF campus doesn't happen without the land swap? Tough call. Either way, imo COJ has to find a way to make the land swap happen, while ensuring that Gateway delivers.

[Jax_Developer]

The DIA should be able to dispose of property under market value for uses that have greater benefits than whatever is being given as that discount. That reasoning is why the downtown incentives provide an ROI calculation for incentive requests & why (technically) the DIA would need city council's approval on any negative ROI calculated for DT incentives.

Holding up a $200M campus extension would be one of those things, in my opinion, that isn't worth leaving some money on the table for. The sales tax alone will eclipse any given benefit if things work out the way people say they will. The focus needs to be on implementing terms for the Gateway team to execute so that the city/taxpayer is protected for that immediate value given away.

[heights unknown]

The latest "straight skinny" on the "land swap" deal. Still some knots and snags to undo before smooth sailing and cruising. All in all? Looks like (maybe) a go.

https://www.msn.com/en-us/money/news/land-swap-deal-for-uf-campus-and-riverfront-park-development-moves-forward-full-purchase-proposed/ar-AA1zoy4v?ocid=msedgntp&pc=U531&cvid=79828e8ceeb14365d078d2c27f2790c9&ei=16

[Zac T]

Ironic that Ron Salem wants to purchase the property outright given his public grievances about the upcoming budget deficits. Seems he's only intent on counteracting anything the mayor does

[Ken_FSU]

Someone get this man a seat on the U2C, because Ron Salem has gone full-clown in the last year or two.

If I’m Gateway, i stop this whole Salem thing dead in its tracks and say that I’m not selling my privately owned investment property to the City. $4 million? GTFO with that nonsense.

This land swap is an absolute layup for the city, where everyone comes out for the better and a strained general fund spends $0.

Truly moronic that Salem would try to torpedo it, just to grind his personal axe and build his own goofy clout.

We get it, you hate the mayor.

But you’re only making yourself look like a petulant child with the constant undercutting and witch hunts.

[heights unknown]

Well put and amen Ken, amen.

[Steve]

So disappointed with Salem.

This feels like he's exploring a Mayoral Bid in 2027.

[Houseboat Mike]

Ken, Heights, Steve....you literally all said the things that were bouncing around in my head. And people wonder why Jacksonville has a perpetual image complex? Things like this....that is why. Good lord.

[jcjohnpaint]

Me too and he is from all I am hearing