Author Topic: JEA hunt for headquarters site is silent on evacuation risk  (Read 14777 times)

thelakelander

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JEA hunt for headquarters site is silent on evacuation risk
« on: January 04, 2019, 11:13:19 PM »
Quote
JEA’s search for the site of a new headquarters building will move forward Tuesday when developers formally submit their proposals in the next step of a selection process that potentially could end with JEA relocating to an area that’s more vulnerable to hurricane-related storm surge flooding.

The criteria used by JEA for selecting a developer does not have any requirements about hurricane evacuation zones, even after large areas of downtown Jacksonville were overrun by storm surge during Hurricane Irma in 2017. JEA is an all-hands-on-deck operation when hurricanes threaten because the utility must restore power as quickly as possible while handling calls from residents.

JEA is inviting proposals from developers to submit their plans for new buildings or renovation of existing buildings on sites throughout the city. JEA says its preference is a location in the downtown area for the building, which would be 200,000 square feet in size for 760 JEA employees.

“This is a transformational opportunity for JEA and the future of the organization as they modernize their headquarters facility,” says the notice from CBRE, the firm hired by JEA to help attract proposals.

Full article: https://www.jacksonville.com/news/20190104/jea-hunt-for-headquarters-site-is-silent-on-evacuation-risk
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thelakelander

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Re: JEA hunt for headquarters site is silent on evacuation risk
« Reply #1 on: January 05, 2019, 09:38:26 AM »
It is kind a dumb if they move to a location that's more flood prone than where they're at. I think being suspect to flooding was one of the big reasons they were pushing for a new location in the first place.
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Kerry

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Re: JEA hunt for headquarters site is silent on evacuation risk
« Reply #2 on: January 07, 2019, 07:30:30 AM »
Anything for Khan.
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thelakelander

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Re: JEA hunt for headquarters site is silent on evacuation risk
« Reply #3 on: January 07, 2019, 08:05:33 AM »
I'm all for Khan moving his Flex-N-Gate corporate headquarters to the Shipyards. That would be a great anchor for that project.
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Kerry

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Re: JEA hunt for headquarters site is silent on evacuation risk
« Reply #4 on: January 07, 2019, 10:10:44 AM »
Lol - awesome idea.
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KenFSU

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Re: JEA hunt for headquarters site is silent on evacuation risk
« Reply #5 on: January 07, 2019, 12:04:19 PM »
I'm still placing my odds right at 50/50 for JEA and Lot J.

The complicating factor is the subsidies.

Lot J will likely be financed in part through REV grants.

As a public entity, JEA is largely immune from property taxes, so there wouldn't necessarily be increased property tax value for the city to capture and rebate.

Unless the city opens the piggy bank in some other way, or issues a REV grant inclusive of the office component regardless, which there are no guarantees of, it might actually be more advantageous to Iguana to pass on JEA and find a private, tax-paying business to occupy the space.

We'll see what happens and what terms (if any) are laid out in their proposal.

vicupstate

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Re: JEA hunt for headquarters site is silent on evacuation risk
« Reply #6 on: January 07, 2019, 01:15:14 PM »
^ Isn't one of the options for JEA to lease space for a period of time? If so, the owner of the building would pay property taxes during that period. 
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KenFSU

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Re: JEA hunt for headquarters site is silent on evacuation risk
« Reply #7 on: January 07, 2019, 01:24:43 PM »
^JEA's looking for a shortish-term lease, with a guaranteed option to buy.

MusicMan

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Re: JEA hunt for headquarters site is silent on evacuation risk
« Reply #8 on: January 07, 2019, 10:36:06 PM »
Concerning Lot J:  Is there anywhere else in the USA where a cities major utility has located it's headquarters in the parking lot of a stadium, such as this?  Asking for a friend.

Kerry

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Re: JEA hunt for headquarters site is silent on evacuation risk
« Reply #9 on: January 07, 2019, 10:37:31 PM »
What is the actual demand for downtown office space?  Khan seems to be running out of potential tenants.
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thelakelander

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Re: JEA hunt for headquarters site is silent on evacuation risk
« Reply #10 on: January 07, 2019, 11:16:39 PM »
No we still have a glut of empty office space in existing buildings.
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KenFSU

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Re: JEA hunt for headquarters site is silent on evacuation risk
« Reply #11 on: January 08, 2019, 10:00:25 AM »
What is the actual demand for downtown office space?

It's a mixed bag.

Downtown Jax is at 14% vacancy, which is right in the middle among major cities in Florida (Tampa and Orlando hover between 10 and 12%, Miami is at 16% but can charge double our rates), but far from terrible, and well below a ton of major markets who have seen more speculative construction during this economic cycle.

The good news is, that 14% represents a nearly 20-year low for Jacksonville. 2018 saw a 5% decrease in vacancy year-over-year, and the rate should drop even more in 2019 as Vystar and the Times-Union move in.

New construction isn't unheard of at 14% vacancy, and in fact, it's happening in a lot of places.

I've got zero doubt that the Jaguars will be able to fill whatever office space they add at Lot J.

The problem is, whether it be JEA or someone else, there's a really good chance that it will come at the expense of the central business district. Could be an existing company in the downtown core choosing to relocating a mile toward the stadium to be a part of the shiny new development. Might be a suburban company finally interested in moving downtown, but choosing Lot J over another tower in the CBD.

Personally, I'm all for letting the market do its thing. If Khan's Lot J office complex and Bank of America Tower are on equal footing, let the tenants choose where they want to go, and live with the consequences.

My issue is that they're not on equal footing, and the city will likely be offering huge public subsidies for Lot J that will effectively give Cordish a competitive advantage in poaching businesses or prospective businesses from a northbank core that we're spending hundreds of millions of dollars to reinvigorate.

Hopefully the city is paying attention to what happened in St. Louis with Cordish's Ballpark Village. The city paid tens of millions of dollars in subsidies for the office component, with the promise of new jobs on the periphery of downtown. What happened? PricewaterhouseCoopers abandons the BOA office tower in the heart of dowtown St. Louis, moves 400 employees to the edge of downtown at the taxpayer's expense, and now pays 50 cents on the dollar for property taxes as part of the agreement. Cordish & PWC win. Downtown St. Louis loses. The St. Louis taxpayers lose.

Houseboat Mike

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Re: JEA hunt for headquarters site is silent on evacuation risk
« Reply #12 on: January 08, 2019, 10:03:46 AM »
I'm still placing my odds right at 50/50 for JEA and Lot J.

The complicating factor is the subsidies.

Lot J will likely be financed in part through REV grants.

As a public entity, JEA is largely immune from property taxes, so there wouldn't necessarily be increased property tax value for the city to capture and rebate.

Unless the city opens the piggy bank in some other way, or issues a REV grant inclusive of the office component regardless, which there are no guarantees of, it might actually be more advantageous to Iguana to pass on JEA and find a private, tax-paying business to occupy the space.

We'll see what happens and what terms (if any) are laid out in their proposal.

I noticed that they have removed all of the office trailers from the site in front of the Courthouse. Isn't that one of the sites they proposed?

KenFSU

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Re: JEA hunt for headquarters site is silent on evacuation risk
« Reply #13 on: January 08, 2019, 10:23:22 AM »
I'm still placing my odds right at 50/50 for JEA and Lot J.

The complicating factor is the subsidies.

Lot J will likely be financed in part through REV grants.

As a public entity, JEA is largely immune from property taxes, so there wouldn't necessarily be increased property tax value for the city to capture and rebate.

Unless the city opens the piggy bank in some other way, or issues a REV grant inclusive of the office component regardless, which there are no guarantees of, it might actually be more advantageous to Iguana to pass on JEA and find a private, tax-paying business to occupy the space.

We'll see what happens and what terms (if any) are laid out in their proposal.

I noticed that they have removed all of the office trailers from the site in front of the Courthouse. Isn't that one of the sites they proposed?

Yep, initial plan was to do a land swap with the city for that parcel.

JEA would have then built their own headquarters near the Courthouse, tried in earnest to sell the old building within a year, and if not, the city would demo the building.

Coincidence or not, right around the time that the Jags announced Lot J, the JEA seemingly abandoned the plan to build their own headquarters, and decided they wanted to lease space from a developer/landlord instead.

Unless someone submits a proposal today that involves that Courthouse property, or unless the JEA rejects all bids and goes back to the original plan, I don't think this space is happening.

vicupstate

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Re: JEA hunt for headquarters site is silent on evacuation risk
« Reply #14 on: January 08, 2019, 10:57:23 AM »
Unless there is a specific tenant driving it, I don't think new office construction is typical in cities' the size of JAX with a vacancy rate of 14%. Also, doesn't JAX have pretty low lease rates throughout DT? That isn't conducive to new construction. 
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