The subject property (hereinafter referred to as the “Property”) is prominently located at 5462 Grand Boulevard, at the southeast corner of Grand Boulevard and Gulf Drive, directly across Gulf Drive from Historic Gulf High School (a/k/a Schwettman Education Center). According to the Property Appraiser’s records, the Property is described as Parcel ID 08-26-16-0240-00300-0010 and Parcel ID 08-26-16-0250-03504-0080; approximately 0.69 acres in the aggregate; occupied by a 3-story office building of approximately 13,310 SF; and currently valued at $401,302 in the aggregate.
It is critical to highlight that the Property includes the two lots on the east side of George Street, contiguous to Historic Gulf High School’s remote parking lot.
Unfortunately, this key site on our City’s premier local north-south thoroughfare has had multiple unresolved code violations since 2019; and this ultimately led the City to seek relief through court action, which it won pursuant to a Uniform Final Judgment of Foreclosure dated January 18, 2024. The Judgment of Foreclosure has ordered a public sale, via online auction, on March 18, 2024.
As you may know, in such an auction, the effective opening bid will start with the amount owed to the City, which is currently estimated at $241,000. Further, if no other party bids on the Property, the City could acquire title to the Property for that amount owed plus miscellaneous fees; and should it elect to bid, would only have to “come out of pocket” for that amount over $241,000.
Given the Property’s prominence on Grand Boulevard and strategic location in relation to Historic Gulf High School and the remote parking lot, staff believes that the City and Agency are being presented with a special opportunity to assemble a catalytic redevelopment site which would not only squarely address the running code violations on the Property, but also enable the City, Agency, and our community to plan and then implement a transformational project for both sides of Gulf Drive, creating a destination for our City and helping to revitalize all of the Schwettman Oaks Neighborhood.
The Agency has ordered an appraisal of the Property to help guide the City’s participation, if authorized, in the online auction. It is anticipated to be complete by close of business, March 8. Consequently, staff has structured this request with a cap of $575,000 or appraised value, whichever is less, and that cap represents the total maximum bid amount inclusive of any City credits, such as the aforementioned $241,000 (e.g., $575,000 = $241,000 + $334,000).
When considering valuation of the Property, its current state of vacancy and physical condition, and the difference that active property ownership and reinvestment can make, it is interesting to compare the building on the Property to the building at the northwest corner of Grand Boulevard and Gulf Drive, 5509 Grand Boulevard. Even though the buildings are very similar in size and architecture, the Property Appraiser values the building at 5509 at $22/SF and the building at 5462 at $13.17/SF.
As you may know, auctions and associated court actions can be fluid and dynamic, leading to other opportunities. For example, another desirable outcome might be a responsible property owner taking possession of the office building but conveying the vacant lots contiguous to the remote parking lot to the City and/or Agency.
If the Property is acquired, staff would outline a proposed procurement process, to be considered at a future meeting of the Board, by which a multidisciplinary planning firm would be selected to lead a community-oriented master planning process for the Property, Historic Gulf High School, and the surrounding Schwettman Oaks Neighborhood. Such a master planning process would include several opportunities for citizen engagement and would be expected to result in the Board’s adoption of a master plan for the sites and surrounding area, which would then be implemented through subsequent action.
RECOMMENDATION:
Staff recommends that the Board authorize the City of New Port Richey to utilize Agency funds to acquire 5462 Grand Boulevard, New Port Richey, FL 34652, at a cost not to exceed appraised value or $575,000, whichever is less, for the purposes of effectuating the redevelopment of the Property in accordance with the Community Redevelopment Plan.
BUDGET / FISCAL IMPACT:
This request would have a direct cost equal to the acquisition cost, not to exceed $575,000. The adopted Agency Budget includes $1 million for property assemblage.
This request would also impose additional costs to the Agency and/or City, including: zero property taxes being collected for the duration of public ownership; master planning; property maintenance; abatement of code violations; design, permitting and completion of renovations; and marketing the Property for sale.
However, within the next five years, it is anticipated that the redevelopment of the Property would create incremental taxable value on the Property, lift values in the surrounding neighborhood, and create other public benefits, thereby producing a significant return on investment, which can be better quantified as part of the annual reporting process after master planning is complete.