The city of Jacksonville says the proposed contract with Cecil Commerce Center’s master developer is fair considering the hundreds of millions of dollars it will have to spend to bring the land to market.
Negotiations between Hillwood Investment Properties and the Jacksonville Economic Development Commission have upset developers who say the deal will depress surrounding land values. JEDC’s board is expected to vote March 24 on the contract regarding the development of 4,400 acres on the Westside. The contract requires Jacksonville City Council approval.
“This is not a land transition but an economic development relationship,” said JEDC Executive Director Ron Barton. “Our priority is creating jobs and building a tax base.”
He said Hillwood will need to spend nearly $272 million to make the center’s land and infrastructure ready for development. Because of uneven ground, wetlands and other development drawbacks, it is economically feasible to develop only about 2,800 acres of the property.
Of those 2,800 acres, about 800 acres will require wetland mitigation, Barton said. The Cecil property will be sold at three different prices depending on the condition of the property. The pricing schedule is as follows:
Property on high and dry sites and with little utility and infrastructure needs will sell for about $23,470 per acre. Bringing the property to build-ready condition will cost roughly $35,900 per acre.
The middle-grade land that is low-lying and has more significant utility and infrastructure needs will cost about $8,800 per acre. The cost of bringing the property to build-ready status is about $62,700 per acre.
The most troubled land, which is filled with wetland and requires significant utility and infrastructure investment, will sell for about $1,000 per acre. It will cost about $112,900 per acre to make these sites ready for development.
Under the proposed contract, the development schedule is split in three phases, with each phase having a mixture of each grade of property. Hillwood won’t be able to move onto the next phase until properties in the previous phase are developed.
Peter Anderson, vice president of Pattillo Construction Co., said the property is still undervalued and most Westside developers are faced with the same types of challenges, including wetlands and uneven ground.
“Why are they so afraid of getting an appraisal?” Anderson said. “If anyone was putting a bank note on the property, the bank would require an appraisal.”
He added that the whole property doesn’t have to be appraised, but the first parcel Hillwood wants to develop should be appraised.
Barton said appraisals are created through the pricing of comparable land and what buyers are willing to pay for the land.
But there is no property that is comparable to the center, nor is the market stable enough to gauge its value, Barton said.
Developer opponents “don’t know the market value of their own property, so it is hard for them to determine what the value of Cecil is,” he said.
Barton said there are few developers that can handle a project of such magnitude and the land isn’t of much value until a developer invests in it.