Carmen Macri
What is really happening with the Laura Street Trio?
Words by Carmen Macri
In the very heart of Downtown Jacksonville lies the very vacant Laura Street Trio. The buildings have been deteriorating for more than 30 years with graffiti covering the walls and overgrown weeds taking over the landscape. But the question remains, why? To put it bluntly, the real issue lies with Jacksonville’s own missteps in developing the buildings (shocker). Steve Atkins, the owner of the historic site, isn’t fully at fault for the city’s indecision. That responsibility falls squarely on the city itself and the Downtown Investment Authority (DIA).
The story goes like this.
In 2013, Atkins of SouthEast Development Group, purchased the Laura Street Trio with plans to transform it into a 143-room Marriott Bonvoy Autograph Collection Hotel, featuring 29,000 square feet of retail space. The project would include a high-end, “sophisticated Southern” restaurant, a 4,400-square-foot bodega, a rooftop bar and a parking garage. At its core, the goal is to jumpstart the development of Downtown Jacksonville—after all, it needs to start somewhere, so why not there?
After some time, a conversation took place between Atkins and the City of Jacksonville discussing budget prices and a realistic timeline for the pricey project. Negotiations were seemingly going well … well enough that the city had reached a developing agreement with Atkins. Well, then Jacksonville decided to bring in the Downtown Investment Authority (DIA) in 2017 to join in on the conversation as, essentially, an overseer dictating how much they believe the city should be spending on this project (if anything).
When DIA got involved, they denied the previously approved budget for the project but “left the door open for future discussion.” The city and the DIA did not agree with the fact Atkins requested a private loan for $150 million from Capitol One with the city as its guarantor. The proposed deal included a $150 million private loan from Capital One with the city guaranteeing repayment by setting aside $22 million and adding more money as needed to cover the yearly payments — if the developer (Atkins) could not pay them. The city would also offer $22 million in mostly forgivable loans from the Downtown Preservation and Revitalization Program, up to $14.5 million in property tax rebates and a $2 million forgivable loan.
However, the City Council Auditor’s Office, the DIA and the city’s finance department all raised concerns about the financial risks of the city guaranteeing the Capital One loan. General Counsel Michael Fackler also pointed out that the state Constitution doesn’t allow the city to use its credit for private projects like the Laura Street Trio redevelopment.
But that raises the argument that money would eventually get pushed back into the city with the development of the Laura Street Trio by the site itself and by enticing other companies or investors to want to develop the surrounding area — which is in dire need of developing… just look at the dozens of vacant buildings, empty lots and abandoned storefronts (R.I.P. Mags Cafe).
While that specific deal might seem a bit unconventional, Atkins isn’t expecting the city to foot the bill: It’s more of a safety net and the only real way to secure the funds for the project. However, the city’s refusal wasn’t without a counteroffer. They asked Atkins to change one of the core elements of the Trio project, suggesting he convert the planned hotel into additional apartments—because, apparently, Downtown needs more apartments right next to the two buildings already on the block. You see the issue? Naturally, Atkins declined, arguing that another apartment complex isn’t what the city actually needs.
“To imagine that the city could do a more effective job of development of this site by focusing solely on rehabbing the historic buildings or by isolating one of the uses, without more (uses), is interesting, considering the amount of time, effort and resources the city deployed in mustering water features at the water fountain on the Southbank, a magnificent development indeed considering everything else that’s gone vertical in the area over the years besides squirts of water,” Atkins wrote in an April 3 email to DIA CEO Lori Boyer.
Ah, yes, the $7.95 million fountain. Because why not pump our money into a useless fountain than, I don’t know, a development that might actually bring more money into the city?
Agreements were seemingly met in 2017 and 2021, but construction was not completed either time. Something that often gets glossed over in city council meetings and, in my opinion, another reason for the refusal: DIA wanting a private investor to jump in and save the day.
When developers take on a major project, they do what they always do — hire a construction company to handle all the heavy lifting (pun intended). Around two years ago when Atkins believed he was finally getting the Laura Street Trio show on the road, he hired Turner Construction Company to start planning and staffing the project. Normally, in any construction job, workers get paid as the work progresses. The company receives an initial payment to cover materials, planning and staffing of the job. Then another payment during the process to, you know, pay the workers, with the final payment coming after the job is complete. The cash grants that Atkins would be receiving would be paid before and during construction — that was a part of the deal. But DIA didn’t want to follow that standard process. They want to hold onto the grant money and wait until the job is finished to pay Atkins and Turner — potentially hoping a private investor would come in and take the bill off their hands. Well, I don’t know if you’ve been Downtown recently, but no private investor is going to pour money into this underwhelming city (no offense). It is going to have to come internally.
“Unfortunately our downtown has taken a great decline, it is concerning,” said Atkins in a recent interview with First Coast News. “It is something that should reinforce the needs of this project.”
A member of Turner Construction, who wished to remain anonymous, had his own thoughts about the Laura Street Trio.
“It’s gone through so many iterations and negotiations,” the source said. “We’re a good company. We can build. We can do this. We want to do this.”
He also recalls that throughout this project, there have been several times when it seemed like work was finally about to start. Turner Construction had recruited workers from across North America with some even relocating specifically for this job. But after endless back-and-forth with the city and repeated broken promises, most of the original team has been left in a holding pattern with some even taking on projects in other cities while waiting for this one to get off the ground. And from the source’s understanding, a big issue lies with the timing of payment. DIA firmly believes that should they move forward with Atkins’ developments, and the grant money should be distributed after the work has been done.
“I think that they feel there should be a lot more private equity brought in. They think that they’re paying too much for this,” the source explained. “We like this project so much because you are both preserving a historical part of Downtown Jacksonville, and revitalizing it at the same time.”
From my understanding, it’s difficult to find a private equity partner right now that would want to come in and make that much of an investment because this project would kind of be like kickstarting Downtown and now we seem to be at a deadlock. Atkins refuses to compromise on his project, and the city, led by DIA CEO Lori Boyer, won’t budge on its budget. Many now think it’s time for Boyer to step aside, pointing to the stagnant state of Downtown as proof. How many projects have been abandoned under Boyer’s watch? The Laura Trio is just one of many. How many false starts does Jacksonville have to endure before we call it quits — Boyer being the one to step down?
Nate Monroe, columnist for “The Florida Times-Union,”said it best in a recent article about this very subject: “Downtown looks and feels utterly dead while the DIA dithers around with low-stakes fights over storage units and park plans that never seem finalized. Meanwhile, the rest of Jacksonville thrives. There’s more exciting development happening on a half-mile stretch of Mayport Road than in all of downtown.”
Jacksonville might need to bite the bullet and finally move forward with the Laura Street Trio project. Downtown won’t see any real progress until someone takes the leap to develop it — simple, right? As the saying goes, high risk, high reward. The worst-case scenario would be the city foreclosing on the property, which seems likely. That would lead to the complete demolition of the historic buildings — an option that’s cheaper for the city but they won’t admit that. They will pretend to go down swinging for the Trio.
Update:
On Sept. 9, a City Council meeting was held to discuss the future of the Laura Trio. While no real development plans were agreed upon, it was announced that Jacksonville-based Live Oak Contracting would be joining Atkins in the project.
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