City pursues First Street parcel for workforce housing project

One small parcel remains between two larger properties the city has acquired for a workforce housing project. Staff is instructed to pursue a letter of intent to purchase.

By Andrew Warfield
| 5:00 a.m. April 8, 2026

The proposed site of a city-owned attainable housing development across First Street from City Hall. The red X marks the location of the city's credit union office, which is now being considered for purchase by the city.

Sarasota
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Nearly two years have passed since the Sarasota City Commission approved the purchase of two parcels on First Street across from City Hall with the goal of building workforce housing apartments there.

Since then, little progress has been made on the initiative introduced by former City Manager Marlon Brown, with the exception of preliminary negotiations between the city and First Street Credit Union. That's the lone holdout in a potential assemblage of three parcels that stretch between Orange Avenue and the back of a strip of businesses fronting Lemon Avenue.

On Sept. 16, 2024, the city closed on 1590 and 1544 First St. for $7.3 million, and since has held commercial leases on those properties. Central to the site, the credit union at 1558 First St. held out, prompting preliminary plans of two towers wrapping around the parcel — measuring 65 feet by 100 feet, or 0.15 acre — which is regarded as likely a higher construction cost than a single building.

During their April 6 meeting, Wayne Appleby, the city’s economic development and real estate manager, updated commissioners on the status of that negotiation and sought approval to proceed to a deal to be brought back for consideration by August 2026.

Sarasota Economic Development and Real Estate Manager Wayne Appleby updates the City Commission on the First Street Workforce Housing project.

Appleby also proposed the commission hire a real estate consultant to help guide the city through the process.

In the end, commissioners voted 4-1, with Jen Ahearn-Koch opposed, to instruct Interim City Manager Jennifer Jorgensen to negotiate and present a non-binding option agreement to purchase the credit union building and parcel and to proceed with hiring the consultant. On Feb. 25, a letter of intent was executed between previous Interim City Manager Dave Bullock and First Street Credit Union, which allows for exclusive negotiations between the parties to reach an option to purchase agreement.

Bullock's tenure in the city manager's office ended in early March, when he resumed his retirement.

Commissioners expressed frustration with the lack of any progress since the property purchase, a sentiment shared by Appleby and staff. And don’t forget, he added, the city is on its third interim city manager since Brown’s retirement in October 2024.

By the time the option-to-purchase agreement is brought back to the commission, new City Manager Karie Friling will have begun her tenure.

“There's a whole lot more due diligence to be done, and we have to remember we've had three different city managers,” Appleby said. “We restart the conversation every time we get a new city manager. There’s a number of reasons why it's dragged on. I feel the same frustration. That's why the real estate consultant firm is being brought on, so that it can work with you.”

The housing project is envisioned as a public-private venture with funding assistance from local foundations. The commission’s vote to approve the purchase of the first two parcels included direction to work with the Barancik Foundation, Community Foundation of Sarasota County and the Gulf Coast Community Foundation for funding assistance.

Since then, according to Appleby’s presentation, the foundations and city representatives “determined the best path forward was to remain collaborative partners in advancing the project … and to delay a funding agreement until the project was more defined and identified the income levels of the housing units.”

That’s where the expertise of a real estate consultant is needed to guide the city in finding the balance between aspirations and fiscal reality, particularly with regard to balancing the rent structure with self-sustainability without government subsidy.

“You're going to have to balance all your wishes,” Appleby said. “That (consultant) is going to tell you what's going to cause a subsidy for you every year, so if you lower your wishes, maybe it's not everything (you) want, but (you) can live with it. That’s the sweet spot if you can get there.”

Should the project eventually move forward, the model calls for the financial burden to be shifted to the selected developer and operator. The city has received two unsolicited bids for the project from Sarasota-based affordable housing providers One Stop Housing and Community Assisted & Supported Living.

Letter of intent terms

The letter of intent is a non-binding document outlining terms agreed to by the city and First Street Credit Union to be included in a future option agreement. Terms would be in effect upon an executed option agreement.

Option period: Initial one-year period, which may be extended for an additional four years at one-year increments.
Option fee: Following a 90-day due diligence period, a $50,000 non-refundable fee will be paid by the city. For each subsequent year the city extends, a fee of $15,000 will be paid.
Assignment: The city may assign the option agreement to the eventual selected developer at any time within the five-year option period. The remaining financial burden would shift to the developer.
Exercise option: The city or the selected developer may exercise the option at any time within the five-year period.

author

Andrew Warfield

Andrew Warfield is the Sarasota Observer city reporter. He is a four-decade veteran of print media. A Florida native, he has spent most of his career in the Carolinas as a writer and editor, nearly a decade as co-founder and editor of a community newspaper in Mecklenburg County, North Carolina.