Concerns over what lies beneath a lot where a local developer envisions building the tallest tower between Miami and Atlanta have prompted the Downtown Investment Authority board to seek more information about the site and project.
During an Aug. 26 workshop, DIA board members raised questions about the feasibility of Cross Regions Group’s plans to construct a 720-foot condo tower with restaurant and retail space on a 1.6-acre parcel between the former Jacksonville Landing and the Hyatt Regency Jacksonville Riverfront garage.
A leading concern was how, or whether, a 54-inch sanitary sewer line that intersects the lot would be relocated to accommodate the tower. DIA CEO Lori Boyer also said underground testing had not been done on the site to determine whether other unmapped utility lines or infrastructure were present.
Under a term sheet provided by Cross Regions, the city would be responsible for moving the sewer line.
JEA executive Jordan Pope told board members that moving the line would be “complicated, complex” and “require significant study.” Parts of it are built on pilings, adding to the difficulty of moving it.
“It’s probably not impossible,” he said. “But a lot of that will depend on how much money somebody wants to spend.”
Other potential complexities include removing the easternmost Main Street Bridge ramp leading to Newnan Street, a requirement to meet Florida Department of Transportation 50-foot setback standards. In 2020, the department estimated the cost to remove the ramp at $3.3 million.
A $450 million project
The Cross Regions Group team is seeking to negotiate an agreement with the DIA to build the tower at a total investment of $450 million.
David Ergisi, president and CEO of Cross Regions, said he had lived in Jacksonville for 26 years and was committed to building a seminal project that would spark a turnaround for Downtown.
Ergisi said his company has 22 projects under development that together comprise a $1.4 billion investment. Those include the Fountains at St. Johns, a 100-acre, mixed-use development anchored by Ascension St. Vincent’s Health Center and including several restaurants, a 247-unit apartment community, a Jacksonville University campus, a Home2 Suites by Hilton extended-stay hotel and the TyMe Cancer Research Institute.
DIA board member Jim Citrano Jr. praised Ergisi as a “top-notch developer” but said he believed it was inappropriate to negotiate the project without the DIA knowing more about the site.
“I’m not sure we can determine what the highest and best use is until we have an understanding of the complexities, particularly the underground complexities,” he said. “Because that might change the highest and best use.”
Citrano called for a wider-scale market study of city-owned properties in the Downtown core and said he generally prefers the city to offer parcels through a request for proposals.
“I think you get the best results if you put it out to the development community and then determine the best route to take,” he said.
Take a ‘step back’
Board member Carol Worsham said she was concerned about the constraints of the site and encouraged the board to take a “step back” from entering negotiations on the project.
Daniel Davis, JAX Chamber president and CEO, showed up in support of Ergisi and his team, saying he hoped the board would move expediently on the project. Noting that the chamber offices abut the site, he said he was “tired of looking at a parking lot” and “don’t want to be here two to three years from now looking out my window at the same thing.”
Ergisi said Cross Regions had spent more than a year working with the DIA on the project.
Attorney Thomas Ingram of Sodl & Ingram, who represents Cross Regions, said the developer agreed that there was more work to be done on the proposal, “and we’re willing to do it as part of the negotiating process.”
“It’s not a race to negotiate this, and we have the expertise,” he said. “If it doesn’t work, it doesn’t work. We’re willing to invest a lot of money because we believe it will work. Between the city and the private side we’ve got the expertise to work these things out.”
The workshop ended with the board, in response to a suggestion by Boyer, asking staff to conduct site work and prepare a report on the project for the next meeting of the DIA’s Retail Enhancement and Property Disposition Committee in September.
Ergisi said he would continue to work with the DIA as opposed to taking the project elsewhere.
“I want what’s best for the city,” he said. “Whether we do it on this parcel or another parcel, I want to contribute to Downtown. I don’t want to take this tower to South Florida or Orlando. If at all possible, I want to do it here.”