A $48 million incentive package for Gateway Jax’s Publix-anchored Block N7 project is headed back to the drawing board after the chair of the Jacksonville City Council Finance Committee expressed resistance to a completion grant that makes up most of the proposed funding.
Council Ordinance 2026-0541, which contains the incentives for the $138.6 million project at 119 W. Beaver St., was deferred in the Aug. 4 Finance Committee meeting.
Finance Committee Chair Will Lahnen said the deferral, which was requested by the Downtown Investment Authority, would allow for a restructuring of the incentives, which comprise a $19.6 million Recapture Enhanced Value Grant and a $28.5 million completion grant.
Lahnen said he hoped the DIA and Gateway Jax would “find a way to where we can avoid a big cash completion grant.”
Now in his fourth year on Council, Lahnen has been a leading proponent of dialing back completion grants for Downtown revitalization and economic development projects citywide.
He and like-minded Council members say that after years of committing grants to projects with little regard as to when they would come due, Council strained the city’s ability to pay them.
They prefer to fund projects largely or entirely through REV Grants, which are tax rebates.
With REV Grants, the city essentially forgoes a portion of revenue it could receive, while completion grants involve payouts from the city’s operating funds and therefore stretch existing funds.
Noting that the city has approved nearly $40 million in completion grants for four other Gateway Jax projects, Lahnen said he also was open to possibly restructuring the timing of payouts for those projects to free up funding now for Block N7.
In August 2024, Council approved $98.58 million in incentives for Gateway Jax’s first four projects in its more than $750 million Pearl Square district. Those comprised $59.63 million in REV Grants and $38.95 million in completion grants.
Construction is underway on all four of those projects. Gateway Jax says its first building, the seven-story Vandeveer apartments and retail development, is set to be complete and welcome its first residents late summer this year. For Vandeveer, Gateway received a $9.06 million REV Grant and a $4.63 million completion grant.
The developers are working on other projects, including transformation of the long-vacant Ambassador Hotel at 420 N. Julia St. into Hotel Merrydelle, part of the Marriott Tribute Portfolio.
In May 2026, the DIA board recommended approval of $10.1 million in loans for that project. City Council has yet to decide on those incentives.
Gateway Jax comprises principal Bryan Moll, JWB Real Estate Capital and DLP Capital. At full build-out, its development would expand beyond Pearl Square and involve more than $2 billion in investment.
In response to a request for comment, the development partnership said in an email it was committed to helping revitalize Downtown Jacksonville and was “grateful for the collaborative efforts of the City Council, the City of Jacksonville administration, and the Downtown Investment Authority (DIA) to finalize a development incentive package for the remainder of Pearl Square.”
“We look forward to reaching a resolution that best supports all parties and produces a true ROI for the City of Jacksonville and its residents,” Gateway Jax said.
For the Block N7 project, Gateway Jax plans to replace the former First Baptist Church main auditorium with a mixed-use, 15-story tower that would include 500 apartments, 400 integrated parking spaces and a 31,000-square-foot Publix.
The grocer and Gateway Jax announced in September 2025 that Publix had committed to the project.
In June 2026, the city issued a permit for the demolition of the auditorium.
During a May 19 tour of Gateway Jax’s projects, CEO Bryan Moll said the Publix was critical to the success of Pearl Square. Without a full-service grocery store to serve the district’s residents, commuters and visitors, he said, “it would be much more difficult, if not impossible, to do what we’re doing at this scale.”
Gateway Jax did not immediately respond to a request for comment about the deferral.