With Jacksonville City Council’s agreement to a $ 26.67 million taxpayer funding program, developer Steve Atkins said everything is in place to begin restoration of the historic Laura Street Trio.
Council voted 16 to 1 on September 14 to approve a repayable and deferred principal loan to help Southeast Atkins Development Group convert vacant downtown buildings into a 145-room Marriott Autograph hotel with a restaurant, lounge, store on the ground floor and a bodega grocery store.
After the vote, Atkins said it will be hard work but the trio must be “put back into service”.
“This is a really important project for our city,” he said.
“This is something we absolutely must continue to focus on – the history and development of our downtown area. And not just individual projects, but on a large scale. We will continue to talk about it in the months to come.
“I think when it’s finished I really, really believe it’s going to be the crown jewel of downtown,” Atkins said.
After the bill was passed by the council’s finance committee on September 8, Atkins said he expected site work to begin in early November on the estimated $ 70.48 million project.
Atkins worked for nearly a decade to restore the Florida Life Insurance, Bisbee, and Marble Bank buildings that make up the Trio northeast of Laura and Forsyth Streets.
The Downtown Investment Authority approved a $ 24.656 million incentive program in March with a five-year forgivable loan of $ 9.377 million; a code compliance loan with forgiveness of $ 10 million over five years; and a principal deferred loan of $ 5.279 million.
“This is a bill that has been waiting for 20 years. If you love Jacksonville, you love this city, and you love our history, you have to love this project, ”said Council Member Matt Carlucci.
“This is the most important historic corner of Jacksonville, Florida, downtown.”
$ 2 million added
Bill added a $ 2 million forgivable loan to the city’s pledge to help SouthEast honor an outstanding bridging loan on the property that was left over from the company’s previous attempt to secure financing project through the city.
City officials and Atkins said the lien on the trio is a $ 4 million bridging loan from the nonprofit Local Initiatives Support Corporation Jacksonville tied to SouthEast’s renovation of the Barnett National building. Bank completed in 2019.
This structure is in front of the Trio.
According to LISC Jacksonville Real Estate and Lending Program Officer Charles Shealy, SouthEast’s construction lender on Barnett US Bank would not approve a second lien on that building.
LISC issued the Barnett Labor Loan against the Trio, held by Atkins through Laura Trio LLC, to secure the bridge loan.
In 2017, the Board approved $ 9.8 million in grants and a tax rebate for SouthEast and its then development partner, The Molasky Group of Companies, to renovate the Barnett and the Trio.
However, that deal fell through after the DIA said SouthEast missed a construction deadline for the project parking lot. The garage project was then taken over by VyStar Credit Union and is under construction.
In September 2019, the DIA and SouthEast begin to renegotiate the city agreement to ensure the renovation of the Trio.
According to Atkins, the loss of the Barnett grant made it difficult to repay the entire LISC loan on the trio.
City officials said the lien prevented SouthEast from obtaining its construction funding.
LeAnna Cumber was the only board member to vote “no” on the Trio’s $ 26 million deal. Council member Rory Diamond was absent.
Cumber argued that the Council was awarding the South East $ 2 million for a project it defaulted on and she did not like that the extra money was not approved by the DIA.
Cumber noted that the Council was reluctant to approve incentives in January for the Lot J project from Jacksonville Jaguars owner Shad Khan for this reason.
She also challenged the incentives pushing the developer’s equity in the project below the 10% threshold required by the downtown preservation and revitalization program, which required the council to attach a policy waiver to it. ‘amendment.
She said SouthEast had “no skin in the game.” She said the $ 24.67 million approved by the DIA is “essentially free money” for the city developer.
“Now that we’ve just given them another $ 2 million, there’s hardly any money they’re putting into that,” she said.
“Now I have… philosophical reasons why we shouldn’t donate money for historical properties. I think if the private sector doesn’t see that this is something we should be doing and that it won’t make money, then I would rather, for the most part, just tear them down (the Trio) and build something ‘other who make money. “
A DIA staff report released in March shows SouthEast plans to invest $ 6,802,635 in equity as well as $ 25.67 million in debt financing. The project is expected to receive $ 9.461 million in historic federal tax credits.
The developer is working with investment bank Piper Sandler Companies on the Trio renovation.
Atkins said Barnett’s renovation was over budget by $ 17 million, reaching $ 55 million of the estimated $ 38 million. He said that without the city’s incentives, SouthEast would have to claim federal tax credits for the new market to complete the project.
Past and future trio
The Trio Buildings, constructed between 1902 and 1912, are historic structures and contribute to the Downtown District of Jacksonville National Register, making the Adaptive Reuse Project eligible for the DIA Historic Incentive Program.
Atkins declined on September 14 to say who will operate the winery. The restaurant and bars will be managed by hotel operator Winegardner and the Hammons hotel group of Cincinnati.
According to Atkins, foundation work on the addition will be completed concurrently over 10 to 11 months with the structural remediation of the existing Trio buildings. This would ensure it is safe to start vertical construction, he said.
According to a legislative backgrounder with the bill, the historic Trio buildings would house 86 hotel rooms while the remaining rooms would be in the planned addition at the northwest corner of the property.
Atkins said on September 14 that SouthEast would not formalize leases with third-party retail operators until the project is closer to opening.
Dasher Hurst Architects designed the project and Danis Construction is the contractor.
The full project will take 24 months, Atkins said.