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Jax Daily Record Tuesday, Oct. 12, 202102:30 PM EST

Developer seeking $4 million tax incentive for North Core apartment project

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Augustine Development Group asked the DIA for a grant to support a $39 million addition to its Central National Bank restoration.
by: Mike Mendenhall Staff Writer

Augustine Development Group LLC is requesting a $4.05 million city property tax incentive for a $39.22 million apartment addition to the company’s renovation plan for the historic Central National Bank Building Downtown.

City documents released Oct. 11 show the St. Augustine-based developer could receive another $2.4 million to allow the Jacksonville Fire and Rescue Department to buy parking spots in the project’s 487-space garage for JFRD’s nearby headquarters.

The Downtown Investment Authority board Strategic Implementation Committee is scheduled to take its first vote Oct. 15 on a term sheet for the tax incentive.

If the DIA committee supports the incentives, the deal could move to the full DIA board for a  vote Oct. 20. City Council will have to approve the deal before it becomes final.

Augustine Development is building the 103-unit multifamily building and garage through subsidiary AXIS 404 Julia LLC. The 0.78-acre site is bounded by Church, Pearl and Duval streets.

The structure is part of a mixed-use project that includes renovating the historic Central National Bank Building at 404 N. Julia St.

According to a DIA staff report, the bank building would hold 36 apartments and about 5,769 square feet of ground-floor retail space.

The committee likely will vote Oct. 15 whether to advance the term sheet and property tax refund for the new construction to the full DIA board. The refund is a 75% Recapture Enhanced Value Grant for 15 years. 

Augustine Development Group wants to transform 404 N. Julia St. into apartments.

A REV grant is a partial property tax refund of the projected ad valorem increase generated by developing a piece of property.

The Augustine Development subsidiary is negotiating with JFRD to reserve 120 parking spaces for its headquarters at 515 N. Julia St. The city could pay Augustine Development $2.4 million to buy the spaces through a completion grant for the garage structure, according to the DIA documents.

An Oct. 11 email from DIA staff says the price for JFRD’s parking spaces could be revised before the deal is finalized.

The DIA staff found that the project qualifies for a 50% REV grant under its scoring system. But in its report, the DIA recommends the higher 75% rebate, which would need City Council authorization.

The term sheet says the city should consider granting a full 75% REV grant because the project gives JFRD a parking option with no maintenance costs and the 36 residential units in the historic bank building are not factored in the deal.

DIA staff estimates the city would receive a $1.33 return of investment for every $1 offered to the developer for the Central National Bank Building’s new construction. 

If the DIA board and Council choose to limit the tax incentive to 15 years at 50%, the total tax incentive would drop to $2.7 million.

Augustine Development told the DIA it estimates apartment rental rates for the project will be $2.10 to $2.69 per square foot.

The company expects a 17% vacancy rate in the first year, dropping to 10% the second year and to 5% the remaining 10 years.

The term sheet says the DIA first is considering incentives for the new construction to allow Augustine Development time to secure financing and execute contracts to start construction.

According to the DIA, Augustine Development likely will seek historic development loans later for the Central National Bank Building restoration through the city’s Downtown Preservation and Revitalization Program.

The parking garage also would support parking for Augustine Development’s $18 million, 100-room renovation of the historic Ambassador Hotel next door at 420 N. Julia St.

Augustine Development, led by CEO George Bochis and President Bryan Greiner, wants to restore the entire city block in Downtown’s North Core. 

The company is ready to start construction on a $35 million 135-unit multifamily renovation of the 18-story Independent Life Building at 233 W. Duval St. across from the Ambassador and North Central Bank Building.

Bochis said in September that he has been asked why Augustine is focused on Downtown Jacksonville and the North Core.

“To me, it feels like Nashville felt like a decade ago. And now you can’t buy anything in Nashville,” Bochis said. 

“You try to find the next Nashville.”

Bochis said the DIA and mayor’s office “are really, really starting to pull Jacksonville along to where it deserves to be.”

Augustine Development is scheduled to begin work at Independent Life on Nov. 17 , according to the DIA documents.

The Downtown Development Review Board granted AXIS 404’s Central National Bank project conceptual design approval in November but it will need the board’s final OK to proceed with construction.

Bochis said he expects construction on North Central National Bank to be completed in 2023. 

The DIA term sheet says the developer must complete construction within 24 months of starting the project.

Summit Contracting is the general contractor on the Central National Bank’s new construction.

Dasher Hurst Architects designed the project. 

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