A Downtown Investment Authority subcommittee decided Tuesday to recommend that the city seek bids from prospective developers for the former City Hall and Duval County Courthouse properties being cleared along East Bay Street.
The DIA’s Strategic Implementation Committee agreed to begin the process of issuing a formal notice of disposition, which triggers a new search for development ideas for 220 and 330 E. Bay St.
A decision to issue the notice requires the approval of the nine-member DIA board, which meets March 20.
Before a notice is issued, the DIA is expected to hire a real estate consultant to help market the search, identify criteria and act as a liaison to the development community.
A similar strategy was used in 2018 when the city engaged real estate firm Jones Lang LaSalle Inc. to help solicit bids for the 8.3-acre site to become a convention center complex.
Mayor Lenny Curry ended that effort when he said it was not the right time for the city to pursue a convention center.
During Tuesday’s meeting, the committee considered proceeding with an unsolicited bid the DIA received in August, issuing a request for information or moving ahead with a new notice of disposition.
The DIA received the unsolicited bid from Rimrock Devlin DeBartolo that proposed transforming the properties into a mixed-use development dubbed Riverwalk Place.
Brian Hughes, DIA interim CEO, said selecting that bid wasn’t a prudent move for a city trying to cast a wide net for development ideas.
Hughes also is Curry’s chief of staff.
If the DIA chose the Rimrock proposal, it would have to issue a 30-day public notice so that other interested parties also could submit plans.
“I think that timeline excludes the potential for other good ideas,” Hughes told the group.
Hughes and committee members also decided against issuing the request for information, since that process wouldn’t conclude with negotiating a deal with a firm.
Committee Chair Ron Moody said that process would be a waste of time for the city and developers.
Board member Oliver Barakat suggested the DIA engage with a commercial real estate consultant because it would be important to have consensus on the process and programming of the site before the agency asks development firms invest in creating proposals.
“Since this site is so important and so close to the core, we need to make some guidelines,” he said.
Barakat said the consultant could identify uses the city wants incorporated in proposals, like creating greenspace, engaging with the waterfront, being sensitive to retail needs along Bay Street, parking, and integration into JTA’s smart cities innovation project.
“This should be a very desirable site and will get a lot of national attention,” said Barakat.
Next steps
If the DIA proceeds, Barakat said it could take two months to issue a notice of disposition.
A notice likely would be advertised for three to four months to allow development firms time to perform due diligence on the site, work with their partners and craft a proposal.
The timing also allows the DIA to complete its search to hire a permanent chief executive officer as proposals are presented to the board by fall.
In November, the DIA contracted with executive search firm Jorgenson Consulting Inc. to help identify the next CEO.
The DIA will score each proposal based on agreed-upon criteria and eventually hear proposals from development groups.
The DIA board could vote to begin negotiations with a firm or take another direction.
Hughes expects that process would conclude by year-end.
“Based on the committee’s recommendations, I think that’s where they want to head,” he said.
Jacksonville City Council members likely will have the final say if an economic development agreement advances with taxpayer-backed financial incentives.
Based on the timing, that decision would occur after a new council takes office July 1.
Council President Aaron Bowman said Tuesday he believes the DIA is making the best decision for the city.
“I think in the world we live in, where we want fair competition, we just can’t take an unsolicited bid,” said Bowman.
“I think also by opening it back up it to a national search, it will bring in ideas that we haven’t even thought about,” he said.
Starting over
The choice to issue a new notice comes three months after Curry asked the DIA board to table discussions about redeveloping the site as a convention center and hotel development.
He said it was premature to proceed without more amenities and lodging options for visitors.
That process began in January 2018 when the DIA issued the first notice of disposition and culminated in September when the DIA board considered three proposals.
Jacobs Engineering Group’s proposal outscored other submissions from Rimrock Devlin DeBartolo and Preston Hollow Capital LLC.
Dallas-based Jacobs Engineering’s proposed $598 million complex included a hotel, convention center, parking garage and retail and dining facilities along with 713,000 square feet of exhibition space.
Negotiations did not advance.
Rimrock Devlin DeBartolo then presented the DIA with the unsolicited bid for Bay Street development.
It also submitted a separate proposal alongside Jacksonville Jaguars owner Shad Khan’s Iguana Investments Florida Inc. and The Cordish Cos. to build a convention center on what is now Metropolitan Park.
The idea is one piece of Khan’s ongoing pursuit to develop property along the Downtown Northbank and next to TIAA Bank Field.
With the city planning to remove a section of elevated highway connecting Downtown to the Hart Bridge, a convention center on that property is at least two to three years away.
Khan instead is focused on the first phase planned for what is now parking Lot J, west of TIAA Bank Field.
No framework for a deal is available.
Khan’s company is one of three trying to secure JEA’s new headquarters campus. Khan is offering the Lot J mixed-use project that could comprise a hotel, parking garage, entertainment venue, retail and dining.
JEA is expected to choose its new headquarters site in early April.