Looking east down King Street, a rendering depicts the proposed Sebastian Inland Harbor. Rendering Courtesy of PQH Vargas
-Looking north along the San Sebastian River, this file photo shows construction on the Sebastian Inland Harbor, underway Saturday, August 18, 2007. by DARON DEAN, daron.dean@staugustine.com
San Sebastian Inlet developer hoping to revive project
Developer working to regain control of San Sebastian project from bank
Posted: November 30, 2011 - 11:31pm
By PETER GUINTA
peter.guinta@staugustine.com
A proposed 11-acre mixed-use development project at King Street and the San Sebastian River tanked due to the 2007 recession, but it’s trying to be revitalized by its original investor, St. Augustine officials said this week.
Mark Knight, city director of planning and building, said, “There are people with a strong interest in (this project). There are no contractual obligations or development plans yet, but they’re looking at it.”
The original architectural plans, drawn up by PQH Architects and Engineers of Jacksonville, showed a restaurant to be built just west of San Sebastian Winery, a surface level parking lot built on the Riberia Street side, office buildings and condominiums with retail on the main body of the property, and a 2-acre, 46-slip marina, containing a public river walk and plaza.
Other developers also presented ideas, such as putting a parking garage off Riberia Street and a clock tower in the shape of the St. Augustine Lighthouse at the corner of Malaga and Lorida streets.
Lorida Street has been renamed San Sebastian Drive since that time.
City officials calculated that the project, estimated to be worth $50 million after build out, would pay $600,000 to $700,000 per year in taxes.
But the property sits in a Community Redevelopment Area, meaning that the city must plow back that money into parking other project requirements the “reduce blight” in the CRA.
This week, Wallace Devlin of The Devlin Group, one of the developers, said that he’s discussing and negotiating with Wells Fargo and is hopeful to get back on track with the site.
“We have never stopped working on this project,” Devlin said. “It’s going real well. We’ve been working with architects and engineers all this time. I’m hoping for some good news.”
The marina dredged there in the early stages is “pretty much complete,” Knight said.
But Assistant City Manager Tim Burchfield said Wednesday that the marina basin may have to be redredged and the docks maintained after both seeing no activity for five years.
“The marina’s silted in some,” he said. “They would also need to build a dock house.”
City Attorney Ron Brown said that after the property was foreclosed, the bank formed Redus Financial Investments LLC, perhaps to act as an independent buyer in case the property went to the courthouse steps, he said.
The question being asked is: Who owns the bulk of the harbor property now?
Brown said, “We’d like to know that, too. It would be nice to get all that resolved.”
Part is owned by Devlin, Schueth & Grunthal own the King Street restaurant part and Matt Merritt of Ponte Vedra Beach and Rich Newton of Atlanta, partners in the Merritt & Newton Group, also own part.
Burchfield said, “The sooner something happens there, the better. Anything we get is better than what we have now.”
Sebastian Inland Harbor project time line
n St. Augustine acquired the property from the San Sebastian River to Riberia Street in the 1980s, paying $1 million for 12 parcels in anticipation of a large commercial development being built at the city’s main entrance corridor.
n The city negotiated with Gainesville developer Ken McGurn for five years, but the two sides never signed a contract.
n Just as the commission was about to sign with McGurn, St. Augustine developer Doug Randall came in at the last minute and offered $1 million more than McGurn was willing to pay.
n Some commissioners thought that unfair and city staff created a points system to rank those companies desiring to take on the project.
n The Vestcor Companies and Hutson Land Companies were the top choices, but both firms pulled out after the Sept. 11, 2001, tragedy, claiming that the times were now too uncertain to invest.
n The contract went to the city’s second choice: San Sebastian Harbor Partners LLC., which offered $3.75 million for the property. The company said it would codevelop the site with The Devlin Group of Ponte Vedra Beach taking on the residential and marina aspect, and Schueth & Grunthal, a Jacksonville real estate company, taking on development of the retail aspect. A fourth firm, Triarc International, of Celebration, would build a hotel and conference center on the site.
n Wachovia Bank, now Wells Fargo, loaned $20 million to the developers.
n When the recession hit in 2007, building stopped and the property went into foreclosure.
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