by Bradley Parsons
Staff Writer
The City has tripled its asking price for a West Adams Street land parcel, a move City officials and area property owners said could establish the low end of the real estate market around the new Duval County Courthouse.
The City bumped the price from $5 to $15 per square-foot for 752 W. Adams St. In 2002, with the location of the courthouse undecided, the Downtown Development Authority endorsed the lower price in an effort to stimulate development in the LaVilla District at downtown’s west end. But with the courthouse destined for the area, $5 seemed a “ridiculous” discount for property sure to surge in value, said Council Finance chair Warren Alvarez.
“It’s the cheapest it’s ever going to get; we should have gotten $18,” said Alvarez. “The City’s investing $300 million (in the courthouse) down there, you think that isn’t going to kick up the land value?”
Alvarez estimated the land could sell from $20 to $24 a square-foot after the courthouse opens in 2007.
The new price didn’t make the potential buyers happy, said Alvarez. Local attorneys A. Russell Smith and Harold S. Lippes, who would have spent $91,500 for the parcel, saw that price increase to $237,000. Including the land, the pair still plan to spend about $1.6 million to build an 11,000 square-foot office building on the site. Smith and Lippes’ law firms would move into the building, leaving about 7,000 square feet available for lease. The deal requires Council approval.
“They’d like to buy it at $5; they weren’t happy,” said Alvarez. “But it’s not our job to make them happy; our job is to protect the City’s interests.”
Even at the increased price, Finance Committee member Jerry Holland said the land was a bargain. The current price reflects a compromise between an $18 per square–foot rate proposed by Alvarez and $11.25 offered by Smith and Lippes. The City spent $11 per square–foot to demolish the previous building and clear the lot.
“The applicants had one appraisal and we had our appraisal, and it got to the point where we thought, we can continue to trade appraisals, or we can get something in the middle. They realized the value is still very much there,” said Holland.
The higher rate pleased area landowners, who are watching the market carefully in anticipation of the courthouse’s arrival. The Elkins Building at 701 W. Adams St. already houses the law firm of Spohrer Wilner Maxwell and Matthews. Elkins Constructors vice president Jim Gajewski said the firm moved to LaVilla to be near the courthouse. Gajewski recently spoke to Spohrer about extending their lease.
Increased interest in the local real estate market was obvious, Gajewski said. He said another law firm had bought a nearby abandoned auto shop with an eye toward renovation.
The City’s increased asking price for West Adams Street land was more evidence of an improving market, he said.
“When you start getting around $15, $18, $20 [per square-foot], you’re starting to get closer to Riverside prices now. As a property manager, it’s great. Now, if I’m a developer, it’s obviously a different story.”
Elkins built its building three years ago, before the courthouse location was announced. Gajewski said the location’s accessibility to interstates and City Hall were the primary benefits then. If prices continue to rise, Gajewski said Elkins would consider vacating the building and selling or leasing the space.
“In the long run, we may look at it as a contractor and decide the area is better suited to cater to the legal profession,” he said. “We’re very satisfied with what we have built, but down the road it could be a different deal.”