In what’s been termed “the last chapter of the Shipyards transaction,” two City Council committees approved a settlement agreement this week of $23 million for the City’s unsecured claim in the long-troubled 40-acre riverfront development.
The agreement does not guarantee payment because Landmar Group LLC is in bankruptcy proceedings and any payments are contingent upon the outcome of third-party litigation. The City agreed to a 2004 development agreement with Landmar on the property.
The land, which is on the Downtown Northbank of the St. Johns River between Metropolitan Park and The Plaza Condominimums at Berkman, was returned to the City from Landmar in lieu of foreclosure. Even with the deed, the City was left with an unsecured claim of $37 million.
The Council Rules and Finance committees approved the measure Monday and Tuesday, respectively, which will now head to the full Council Sept. 27 for a vote.
Landmar entered a deal with the City in 2004 after a failed City deal with the TriLegacy Group to develop the property in which the City issued $46 million in bonds for public improvements.
Landmar, as part of its deal, completed $19 million in public improvements, mainly in the form of a bulkhead, John Germany of the Office of General Counsel told the Rules Committee Monday.
The land’s true value did generate discussion among Rules members. Germany told the group the land’s 2009 appraised value was $20 million although the Property Appraiser’s Office has set the value at $29 million.
Rules members asked for clarification and information before Tuesday’s full Council meeting.
The $20 million based on the 2009 value combined with the $23 million agreed-upon settlement would be close to the $42 million in bonds remaining and, as Germany said, “a pretty good deal for the City at this point.”
Rules member John Crescimbeni questioned Germany whether the City could continue to litigate for the $37 million unsecured claim.
While Germany said it could, he said years of litigation would cost legal fees and still mean the courts would determine the City’s recovery.
There was no discussion on the measure Tuesday during the Finance Committee meeting.
The Rules Committee voted for the measure 6-1, Finance 7-0. Crescimbeni, who serves on both committees, opposed the item Monday before approving it Tuesday.
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