City to revisit State Street garage sale

As Joe Hembree considers his plans to develop a pad property at the State Street garage, he’s run into a roadblock: It’s too small.

Hembree, president of commercial real estate firm Hembree and Associates, bid $688,000 for the 5,041-square-foot property. His winning bid was more than $300,000 higher than the next closest price submitted.

Hembree’s vision includes a six-story structure including retail on the first story, office space on the second floor and about 18 600- to 800-square-foot residential units on levels three through six.

But as it stands, Hembree says, his project isn’t economically feasible. He made a number of requests to help facilitate his plans, including the shared use of a garage stairwell and the use of garage spaces for residential tenants of the pad site. The most significant request, however, is Hembree’s interest in incorporating more city-owned land into his project.

That land is located on the western end of the existing Northern Trust bank parking garage, fronting nearby Pineapple Park. Hembree visualizes this as a two-story mezzanine structure, acting as a liner building for the garage and adding activity to the park. The roof could also include amenities for the pad site apartments.

Although the City Commission voted to allow staff to negotiate with Hembree, commissioners expressed a hesitance to change the terms of the sale Monday. Prior to the 3-2 vote that authorized staff to re-examine the sale, the dissenting commissioners signaled even stronger emotions about the continued negotiations.

“I’m sure we’re going to get sued somewhere down the line,” Commissioner Shannon Snyder said.
“I predict this will blow up in our face,” Vice Mayor Susan Chapman added.

In addition to worries about encroaching on Pineapple Park, there were also concerns other bidders would object to the sale of additional land. City Attorney Robert Fournier said he didn’t believe a separate sale of adjacent land would be a legal issue, but that failed to soothe Snyder.

“If I was bidding on one contract and realized it opened the door to another piece of property, and I didn’t get the opportunity to bid on that — oh yeah, I’d be (taking legal action) in a heartbeat,” Snyder said.

Hembree said without the proposed addition of land, nearly a third of the property is devoted to necessary features such as stairwells. There are also design challenges inherent to a shallow building, such as designing apartments that include windows in both bedrooms and living rooms.

Hembree would pay for the modifications: In a letter to the city, he said his team would increase its bid by an additional $200,000 if his requests were granted. Although he did say the project was not guaranteed to go through even if the changes were made, he said his goal was for the development to mesh with the adjoining park property.

“We’re going to do the best we can with the park,” Hembree said. “It’s in our best interest; it’s in your best interest.”

If the city declined to renegotiate the sale, Hembree believes the issues with the site would persist with a different developer.

“Probably, if we walk, the next person’s going to have the same problem,” Hembree said. “We’re trying to do a project that the city would be proud of.”

Commissioners Paul Caragiulo and Suzanne Atwell both said the city needed to further examine Hembree’s requests. Although he was skeptical of the changes, Caragiulo said permitting staff to bring back a renegotiated contract would give the commission — and citizens — an opportunity to weigh in on the proposal.

“I agree this is really dicey territory,” Caragiulo said. “This probably would at least allow us the time to look at this process and look at what is developable and what isn’t developable.”

DRAWING THE LINE
Although city staff said the land requested was separate from Pineapple Park, Commissioner Shannon Snyder and Vice Mayor Susan Chapman viewed it as an intrusion into city parkland.

“It looks like it’s not just the liner of the garage,” Chapman said. “It looks like it goes into the dolphin fountain park.”

The land in which Joe Hembree has expressed an interest extends more than 30 feet from the Northern Trust parking lot, jutting into an area lined with trees adjacent to the fountain.

Still, the area is not parkland, Deputy City Manager Marlon Brown explained. The land is a vacated right-of-way, the former site of Lemon Avenue and available for redevelopment.

As a result, the sales process would be less rigorous than what would be required when selling parkland — though that did little to comfort concerned commissioners.