One of the interesting points brought up is that if this were to happen, we likely aren't seeing much office/residential/hotel for a while, since we'll need to wait on the absorption of this space.
The one exception might be hotel-IF the city builds the convention center. I think with this development and a convention center, Jacksonville can transform very quickly into a pretty decent convention city.
I think Jax could be a decent convention town.
I'm worried all we'll end up with is a practice field on the riverfront.
^If were just going to divide it up and sell it off, we could do it ourselves and keep 100% of the profit and 100% of the tax revenues, instead of 20% and 0%.
Taca, the city has already stated that there's no interest in dividing up the parcel.
There is no "interest" because Shad Khan is guiding the process and playing puppetmaster.
I do agree with Taca that the city could act as master developer and keep 100% of profits. However, I think in that scenario just about anyone would seek property tax abatements of some sort. I think pretty much everyone is asking for the REV Grant from COJ these days. I don't think Khan should be punished for being wealthy and should qualify for abatements just as any old Joe would. However, I do think that the 80-20 proposition is ridiculous. That needs to get a lot closer to 50% before the city takes it on....unless of course Khan has a few aces up his sleeve (like a major corporate relocation).
The city could. Other cities do have very strong agencies with competent people who know how to properly develop these things or get these things developed. I don't believe Jacksonville is such city. In fact, I would guess that overall the city has some of the least competent people working for it.
Khan seemingly came up with a process to move forward with development, and he has the wherewithal to find people to develop it. He will implement, so he's asking to be paid for this. If the city were competent, this would all have been done years ago.
The City's basis in the Shipyards is the $36.5M given to TriLegacy. That's it. It owns the Shipyards strictly as a secured creditor (oh, and under state and federal regs, as a secured creditor, it becomes entirely liable for the contamination if it does not actively try to convey the property in a commercial feasible manner).
Under Khan's proposal, the City's basis in the property is $36.5M plus whatever capital costs Khan is seeking. Seems to me, the 20% that goes to the City plus future tax revenues eventually covers the City's basis in the property.
If the City breaks even on this deal, it's a win. That property has been idle for far too long.
But my understanding is that future tax revenues go to Khan/Shipyards development groups? Also, how much is all of this land worth? Let's say 30 out of 53 acres gets sold at $2M/acre. City makes $11-12M back, which is chump change. Future tax revenues are certainly not going to be all that much either, and won't be realized for many decades (and it sounds like they will be used to pay off a loan secured by TIF bonds issued by the city, in other words, Khan pulls tax revenue out up front, city gets paid back many years later).
My question with the TIF is that if it's all 1 district and Khan wants all TIF to go to the Shipyards - does that prevent other developers from benefiting the way Khan wants to benefit? And what if a successful Shipyards plays a role in doubling the value of other buildings downtown. He gets all of that incremental tax revenue as well? What's the time period? When does the district expire?
