Jeremy's Notebook

ECUA Says Okay

July 25, 2013

ecuaDespite concerns about what might eventually be developed on the site, the Emerald Coast Utilities Authority voted this afternoon to take the next step toward selling its 19-acres of prime downtown Pensacola real estate to a Texas developer.

“It’s not going to be a pig lot, and it’s not going to be low income housing,” said ECUA Chairman Larry Walker, just before the board’s 4-1 vote.

Earlier in the day, Walker had discussed the possible sale with Pensacola City Council President P.C. Wu. The city official is among those who has expressed concern about the potential for a development in the heart of the city that didn’t jive with the community’s vision for the area—the ECUA’s vacant and remediated sewage treatment site sits across the street from the city’s recently developed Community Maritime Park.

“He said he was sure we would do what we thought was best,” Walker relayed the discussion. “Mr. Wu and I are good friends and we had a good, frank conversation.”

The ECUA’s affirmative vote today essentially acts as a counter offer to HT Land Co.’ s second offer on the property—Texas developer Aaron Wiese is offering $7.6 million, plus $150,000 escrow fee, of which $50,000 is non-refundable. The board voted to accept a few tweaks to the proposed contract, including a stipulation that the $50,000 non-refundable escrow fee be received prior to due diligence.

The ECUA board rejected HT Land’s initial offer (also $7.6 million, but minus the non-refundable escrow) last month. The board expressed concerns at that time that the buyer had not personally met with local officials.

Walker recalled describing Wiese as a “black hole.” The chairman today said he has since learned enough about the potential buyer to feel more comfortable.

“Basically, I am happy now,” Walker said.

The lone vote against moving forward with the sale was cast by board member Lois Benson. She said risking selling the property to someone who could be a “squatter” or a “flipper” or not adhere to community vision would be akin to “dropping the key to our city.”

Benson also expressed concern about not having met Wiese. The board member said she had spoken to a real estate agent who said the developer’s absence was “nuts.”

“We’re at a little bit of a disadvantage,” Benson told her fellow board members. “We haven’t been able to look at him, talk to him, kick the tires.”

Pensacola City Councilman Brian Spencer—speaking as a citizen—also raised that point. He asked the board to take some time and become “more familiar” with the buyer.

“I”m hoping that you all will press the pause button,” Spencer said.

Mike Russo, a local real estate broker representing HT, said that his client considered the ECUA property to be his “first choice,” but was also looking at other properties in the region.

“I’m not sure he’s going to hang in there as long as you’d like him to hang in there with this piece of property,” Russo said.

ECUA board member Dale Perkins didn’t appear bothered by the lack of face-to-face with the buyer.

“Big developers hire people to do things for them,” he said. “Really, really rich people don’t go to ECUA board meetings.”

There was also some discussion during today’s meeting about a set of conceptual plans for the property provided by the brokers. Both Spencer and Benson cautioned that the plans were conceptual and were not to be considered representative of the eventual development.

The renderings are of a mixed-use development, consisting of retail, residential and a hotel. Spencer said they conveyed the “ambitious development potential,” and Benson said the architect who designed the rendering referred to it as “a what-if.”

“I described it as robust,” Spencer said of the conceptual plans.

Russo informed the board that the plans had been commissioned because HT’s original plans would not have been appropriate.

“What he showed us would not have worked,” he said.

Russo said that Wiese was “excited” about moving in the direction conveyed by the conceptual plans—“he likes it”—and intended to develop a “very positive and very progressive” property. The broker did say that any development would hinge on a feasibility study.

Perkins remarked that it was not the ECUA’s role to dictate what the buyer should do with the property. He said the board’s decision to move forward with the contract shouldn’t be tied to HT’s intent.

“No developer is going to come up with a final site plan and say, ‘please bless this ECUA, and then if the city’s okay with it we’ll buy the property,’” Perkins said.

The contract approved by the board today contained a couple of provisions stipulating conditions under which the buyer could exit the agreement—if the there is found to be environmental issues with the property, or if the city of Pensacola altered the Land Development Code in a manner which precluded development.

“You can’t expect them to be responsible for it if the city changes codes and he can’t develop it,” said ECUA Executive Director Steve Sorrell.

A representative of the buyer informed the Pensacola City Council recently that any development would adhere to design and aesthetic requirements. The city planning department has signed off on the conceptual plans, and Mayor Ashton Hayward said this week that it appears the developer intends to work with the city.

Following today’s vote, Councilman Spencer said he was thankful for the recently adopted Maritime overlay district, which spells out standards for the area. Council President Wu will feel more comfortable when the city looks into changing the current zoning.

“Right now, the things we’re afraid of them building, they have the right to build,” Wu said yesterday. “I believe if they wanted to put a car repair shop and a cement plant up he could do it.”

Prior to the ECUA’s vote today, Benson mentioned the great efforts made to move the sewage treatment facility out of downtown—“we’re going to see moving the sewer plant in every one of our obituaries”—and cautioned against risking an unknown development on the property. Wu made a similar argument Wednesday.

“To go backwards,” the council president said, “would just be like sticking a knife in your heart.”

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