The $3 million in grants and a loan would help finance 78 apartments and commercial space.
A City Council committee advanced $3 million in taxpayer-backed incentives for a Tampa-based developer’s plan to transform the former Jacksonville Jewish Center in Springfield into apartments and office space.
The Council Neighborhoods, Community Services, Public Health and Safety Committee voted 7-0 on June 15 to sign off on Ordinance 2020-0187.
It includes taxpayer-backed financial incentives for a $14 million project with 78 market-rate residential units and 8,000 square feet of commercial office space on the 2.12-acre site in the historic neighborhood north of Downtown.
Developer Springfield Lofts LLC wants to renovate the existing structures at 1341 Pearl St., 235 W. Third St. and 205 W. Third St. and add new construction.
The incentives include a $1 million Recaptured Enhanced Value Grant at 75% over 10 years; a $1 million completion grant; and a $1 million, 20-year development loan repaid with 3% interest.
Springfield Lofts is a subsidiary of Tampa-based real estate firm GNP Development Partners LLC, which purchased the property in January 2016 through Fore Independent #15 Skyscraper Holding LLC and Springfield Lofts.
Joshua Pardue and Mark Gerenger are GNP Development co-principals.
The incentive deal will go to the Council Finance Committee on June 16 before the full Council considers the legislation June 23.
The former Jewish center is designated as a historic contributing structure in the Springfield Historic District north of Henry J. Klutho Park.
Kirk Wendland, executive director of the city’s Office of Economic Development, said both the completion grant and city-backed loan will not be paid until the developer completes construction on Springfield Lofts.
Wendland told the committee June 15 that the money is meant to supplement short-term private financing that GNP Development Partners is trying to secure.
The bill, introduced by Council President Scott Wilson on March 11 at the request of Mayor Lenny Curry, asks city lawmakers to waive the public investment policy, which limits REV grant tax rebates to 50% of the increase in ad valorem taxes and requests the project to create at least 10 permanent jobs.
City economic development officials said that rehabilitating the property will reduce blight in Springfield and promote the park and the city’s planned Emerald Trail system.
“We believe this is a very meaningful project to continue to enhance the Springfield area,” Wendland said.
“There’s still some blight in that area. … (The project) rehabilitates a historic structure that has seen significant blight and will just continue to go further into disrepair.”
Council Auditor Kim Taylor said an amendment approved by the committee adds language to the bill decreasing the completion grant award proportionally if the developer invests less than $14 million.
If GNP Development Partners spends less than $10.5 million on the project, the grant would be void.
The developer also will have to be current on its city-backed loan payments to receive the REV grant, according to the amendment approved by the committee.
Several Neighborhoods committee members paused on approving the incentive package, despite the unanimous vote, targeting the $1 million completion grant.
Council member Danny Becton, who is not on the committee, called the grant June 15 a “giveaway” to the developer.
Council members Michael Boylan and Joyce Morgan cautioned Curry administration officials about waiving the city’s investment policy rules for the Springfield project. Morgan, who represents a large portion of Arlington east of Downtown, said she and other Council members could use the precedent to seek REV and completion grants for blighted properties in their districts.
Boylan suggested administration officials consider supplementing the completion grant with another $1 million in loans.
Wendland said the incentive package is “a matter of helping the developer make the numbers.”
“When these discussions started, it was a lot more grant-oriented than loan-oriented. We pushed it more toward the loan than toward the grant. At a $2 million loan only, I don’t think we see the project going forward.”
Wendland said Pardue is counting on rising rents in the Springfield area and the continued growth of the neighborhood to make the project financially viable.
The developer has paid property taxes late on the three parcels in prior tax years, according to information included in the committee’s June 15 agenda.
The city reports the developer is now up to date on property taxes associated with the project site and the administration plans to waive a $129,108 demolition lien on the property left by the prior owner, according to the agenda documents.
In a Feb. 6 interview, Pardue said developers will renovate three structures and build two new buildings. Pardue hopes to begin construction by late 2020 and anticipates a year for completion. The entire project is 94,000 square feet.
The developer is considering office and coworking space for the project’s commercial component.
Pardue said he is considering a commercial fitness center accessible to Springfield Lofts residents and the public.
GNP Development is deciding what type of commercial uses are viable in the location.