The Downtown Investment Authority plans to reissue a notice of disposition for the East Bay Street riverfront property.
The Ford on Bay, the city-owned property along East Bay Street Downtown, will be back on the market.
The Downtown Investment Authority Retail Enhancement and Property Disposition Committee voted unanimously Aug. 13 to terminate negotiations with New York-based Spandrel Development Partners.
DIA CEO Lori Boyer proposes issuing a new notice of disposition in October, making bids due in early November, scheduling presentations from bidders before Dec. 1 and scheduling the board’s selection vote Dec. 16.
In February 2020, the DIA board approved a term sheet with Spandrel to develop the former City Hall Annex and Duval County Courthouse sites at 220 E. Bay St. and 330 E. Bay St.
Boyer said Aug. 9 that Spandrel sought to reduce its capital investment and the amount of retail space in its $136 million plan for the site. Spandrel also sought to change the residential component to workforce housing instead of market-rate apartments.
The DIA began negotiating with Spandrel in March 2020, but the developer was not comfortable proceeding with the project with the requirements in the term sheet, Boyer said.
“We came to the conclusion the changes they want to make require another notice of disposition,” Boyer said Aug. 13.
She said that changes in the real estate market also support the need for new terms.
Joe Ayers, senior vice president and co-lead of multifamily investment properties in Jacksonville at the CBRE commercial real estate firm, said the demand for market-rate multifamily housing in Jacksonville is “incredibly strong” because of the migration of people to Florida.
CBRE marketed the property for the original disposition and will continue to do so under a contract the firm has with the city, Boyer said.
Boyer recommends requiring market-rate residential in the new term sheet, as well as offering only the former courthouse site at 330 E. Bay St. based on discussions she has had with potential bidders.
A workshop will be scheduled to review and settle on new terms for the disposition of the property. Some changes discussed Aug. 13 include:
• Compliance with design standards and the Downtown view corridor requirement. The DIA would support a deviation from the view corridor requirement if the project is set back at least 100 feet from the waterfront instead of the previous 50-foot standard. The area 50 to 100 feet from the river can be used to create a plaza that would support resiliency and activation, Boyer said.
• Reduce the required Bay Street retail space from 80% to 35% and provide a scoring bonus for additional retail.
Ground-floor uses other than retail or restaurant would meet all transparency requirements. Tenant spaces such as gyms and community rooms or work-live units or offices could comprise the remainder of the frontage but bonus points will be awarded for additional retail or restaurants on Bay Street.
• Require a 10,000-square-foot restaurant on the riverfront with at least 7,500 square feet on the ground floor. The DIA wants a full-service restaurant that would provide a dining destination for boaters. “We don’t want fast-food or ice cream shops,” Boyer said.
• Financial incentives from the city will be limited to a multifamily market rate Recapture Enhanced Value Grant equal to a refund of 50% of the additional property taxes generated by the development for a term of 20 years, the same terms for incentives that were in the original notice.
Be the first to know the latest breaking news and information that business leaders rely on in this fast-paced changing Northeast Florida economy. Regional business news, trends and statistics needed to grow your business. Key upcoming events you won’t want to miss and much more. Click Here to Grow your Business NOW!