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Sarasota Thursday, Sep. 30, 2021 3 months ago

Parking details complicate sale of St. Armands Circle lot

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Before a buyer can redevelop the Fillmore Drive parking lot, the city must determine what costs it’s willing to bear.
by: David Conway Deputy Managing Editor

How much is it worth to convert a spot in a parking lot to a spot in a parking garage?

The answer to that question could significantly affect the potential sale price of the Fillmore Drive parking lot on St. Armands Circle, City Attorney Robert Fournier said in a Sept. 22 memo.

On Monday, the City Commission will hold its third discussion in the past six months about selling the Fillmore Drive lot to JWM Management, a developer interested in building a hotel, grocery store and residences on the 1.98-acre site. In August, the commission voted 4-1 to invite any prospective purchasers to submit their proposals for acquiring the land from the city.

Before city staff returns to the commission with the details of any offers, however, Fournier wants to address a major variable related to the property. Fournier wrote that city officials now anticipate that an offer from JWM Management will include a charge back to the city for the cost of building a parking garage and maintaining the 268 public spaces in and near the Fillmore lot.

Based on a cost estimate of $30,000 per space, that could result in the buyer receiving a credit of $8.04 million toward the purchase of the land at its fair market value. Fournier said that if the appraised value of the land were less than $8 million, it’s possible the city could end up owing the purchaser money.

“Presumably, this is a result that the City Commission would not want to happen,” Fournier wrote.

Another factor complicating a potential sale is the bond associated with the St. Armands paid parking program, used to fund the construction of the Adams Drive garage. The terms of the bond prohibit the city from taking action that would negatively affect the revenue the parking district is expected to generate.

As a result, the only way the city and a developer could permanently reduce the number of public parking spaces on the site is to defease the bonds. Duane Draper, the city’s bond counsel, said the city could have to pay more than $1 million to nullify the bond provisions. That cost would decrease untIl October 2027, when the city could defease the bonds at no expense.

Fournier will ask the commission to provide guidance Monday on how it would prefer to address the parking variables related to the sale of the Fillmore Drive lot.

The full agenda for Monday’s meeting is available on the city website.

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