News Article | 6/3/2010

Cecil Commerce Center: The best option


It would be almost an understatement to say the city’s attempts to develop Cecil Commerce Center have been an abysmal failure.


When the Westside military base closed in 1999, city leaders promised to create 25,000 jobs over 20 years at the new aviation-oriented commercial and industrial park.


Since then, however, the city has worked out only two deals on city-owned land – one with Bridgestone Firestone, which employs just 250 people here, and another with Saft, a battery company that only recently broke ground.


Land controlled by the Jacksonville Aviation Authority has fared a little better, creating nearly 2,000 full-time jobs, says JAA spokesman Michael Stewart.


To its credit, the city admitted its failure and decided to turn over the job to experts in the private sector.


City Hall sent requests for proposals to 184 developers across the nation – including 56 from the Jacksonville area.


There were only five responses and, clearly, the best bid came from Hillwood, a respected Texas development company.


That’s when controversy erupted.


What critics say


– Hillwood isn’t paying enough for the land, which it is getting at today’s depressed prices.


– Those “bargain basement” prices will hurt other industrial parks in the city.


– Local developers shouldn’t be excluded from working deals at Cecil.


– The 25-year agreement is too long; something like 10 years would be more reasonable.


– The Jacksonville Economic Development Commission made a travesty of the process by voting in favor of the deal before letting critics express themselves.


They’re right on at least one point: The JEDC’s shabby treatment of the critics was callous.


But, that being said, local developers had their chance to bid.


And Hillwood makes a good case that 10 years isn’t enough time to complete a project of that scale.


If the critics have a valid point, it would be that Hillwood is getting the land at unreasonably low prices.


But Hillwood will have to provide new infrastructure. It also will absorb land-preparation costs, which will be substantial since Cecil is in wet, low-lying areas.


Those things alone will cost it about $260 million, The Times-Union has quoted JEDC Executive Director Ron Barton as saying.


When factoring in infrastructure and land preparation costs – up to $113,000 an acre in the worst-case scenario – property prices don’t seem so cheap.


Even if the prices are a little low, the trade-off could be thousands of badly needed jobs over time.


Fear of cannibalization


Critics do, however, raise another troubling point. They say Hillwood might fill up Cecil partly by enticing businesses to move there from industrial parks elsewhere in the city.


Let’s hope not. Moving jobs, not creating them, would destroy the intent of the project.


Hillwood Vice President Preston Herold, who plans to move here and head up the Cecil operations, says that won’t happen.


Hillwood doesn’t plan to do it, he says, nor has it done that at its other locations.


Besides, he says, his company has no incentive to lease its land at below-market rates.


That makes sense.


However, the City Council probably should add wording to clarify that the intent is to lure companies from elsewhere, not go after ones already here.


At any rate, the city has proven itself incapable of developing Cecil.


Good reputation


Hillwood’s signature developments are AllianceTexas in Fort Worth and AllianceCalifornia in San Bernardino.


Cecil would be branded AllianceFlorida, which Herold insists would give it instant credibility nationwide.


And, yes, Hillwood does have experience turning old military bases into commerce centers. AllianceCalifornia, in fact, used to be Norton Air Force Base.


The choice is clear:


– The City Council can reject the deal and doom Cecil to another disappointing decade like the last one.


– Or it can hire Hillwood, watch thousands of jobs be created and see large sums of additional tax revenues roll into the city’s treasury.


This city has two crises: Unemployment is almost 12 percent, and taxes are skyrocketing, year after year.


Job creation would put people back to work, and new properties on the tax rolls would put downward pressure on tax rates.


A few years ago, voters were asked whether they wanted to make the Cecil land available to the military, in case it wanted to reopen the naval air base – or if they wanted to keep the commerce center.


They voted for the commerce center … but only after being assured that it would be filled with tenants.


It’s long past time to fulfill that promise.



The Texas development company is best known for two projects:


– AllianceTexas, 17,000 acres, has created 28,000 jobs since 1988. It has 230 companies – 65 of which are on the Fortune 500, Global 500 or Forbes America’s Largest Private Companies list.


– AllianceCalifornia, 2,000 acres, has created 4,000 jobs since 2002. It has 11 companies – five of them on the Fortune 500, Global 500 or Forbes America’s Largest Private Companies list.


Source: Cecil Commerce development agreement


The price


Hillwood would pay:


– $23,470 an acre for 506 acres of “high and dry” land. Hillwood would spend about $36,000 more an acre getting the land ready.


– $8,819 an acre for low-lying, flood-prone land. It would cost another $62,700 an acre to get that land ready.


– $1,003 an acre for low, wet property with no infrastructure. Hillwood would spend another $113,000 an acre getting those sites ready.


Source: Florida Times-Union