by Mike Sharkey
Staff Writer
Someone in Florida either won or shared the $24 million state lottery Wednesday night. Thursday, dozens of folks who wanted to be in on the ground floor — and especially the top floor — of Phase I of the $860 million Shipyards project were supposed to enter a lottery for one of the condominiums that will be part of Phase I.
No such luck, but that’s not a bad thing.
Shortly after receiving approval for Phase I of the 10-year, two-phase project from the Downtown Development Authority’s Design Review Committee in late September, representatives from TriLegacy — The Shipyards development company owned and operated by the Spence family — decided to use a lottery system to determine who got one of the first 100 condos on the site. While the response to the lottery system was a bit on the tepid side, the number of people wanting a riverfront condo has proven to be overwhelming.
Hamilton Traylor, the chief financial officer for ICS Logistics — the parent company of TriLegacy — said he and other TriLegacy officials decided a couple of weeks ago to scrap the lottery plan for several reasons. One of the main reasons was economics. With the stock exchange in daily limbo, those with a lot of money are looking to invest in other areas, one of which is real estate — a proven commodity in the Jacksonville area.
“We have concluded that having the lottery tomorrow [Thursday] is not in our best interest right now,” said Traylor Wednesday afternoon, adding that Thursday’s lottery was actually a rescheduled date. “We made the decision shortly after we postponed the other one. We realized it was not the best way to go about it.”
Other factors have contributed to the lottery cancellation and subsequent rethinking of exactly who will end up with a condo and how they will be determined. Surprisingly, one of the main factors is that more people are seriously interested in the million dollar condos than Traylor or anyone else at TriLegacy could have imagined. Also, people have expressed more of an interest in the condos in the $300,000 range than those in the $750,000 range.
Originally, Phase I called for less than 10 units of the million dollar variety. Traylor said customer demand has dictated that the design of Phase I may now be significantly altered to accommodate the desire for more million dollar units.
“What we are finding out from some people is that the interest was not in the midpoint [condos], but in the upper end and the smaller units that have relative prices that are less,” said Traylor. “People tended to gravitate to one end of the spectrum or the other. And, everybody wants to be closer to the river.
“It surprised us. We had planned for six to eight units in the million dollar-plus range. After reconfiguration, there will be significantly more. I wouldn’t be surprised if that number doubled.”
Potential buyers also had questions regarding the type of materials that would be used in everything from the external facade to the kitchen tile. The marina and accompanying boat slips also concerned several potential buyers. Toss in the fact that the on-site Prudential sales office opened 10 days later than expected combined with the impending holidays, and it’s not difficult to understand TriLegacy’s logic.
“The people said, ‘I’m putting this kind of money up, I want to know what I’m getting. And, I don’t want to stand in line to get it.’ Why lose good customers over this?” said Traylor. “We had really rushed to beat the holidays on this and, starting next week, people will not be interested in buying a home.”
Traylor said the fact that the lottery did not happen and may not happen should not be viewed as a negative about the fledgling project. Instead, he thinks it’s more of a reflection of the amount of interest and the amount of money people are willing to spend to live downtown.
“The good thing is we are getting live feedback about what people want,” said Traylor. “We are going to redraw the units and there are lots of questions about the marina and what else is going to be there.”
Traylor also pointed out that there will not be any delays in construction and the first phase will still be done in time for the 2005 Super Bowl. Traylor said both Jeff Spence, the managing principle of TriLegacy, and his father Carlton, would prefer to slow down the process right now and make sure everything is done properly and everyone is happy. The uniqueness of The Shipyards project is also making a firm time line virtually impossible to establish.
“It takes time to work through all these things,” said Traylor. “We have always said, ‘We want to get it right rather than just get it.’ It’s a market no else has ever attempted and we want to be patient.”