The city of Jacksonville is opening a new round of talks aimed at resurrecting the long-dormant Laura Street Trio of historic buildings in the heart of Downtown, this time with a new lead developer who hopes to purchase the property.
In an agreement involving Mayor Donna Deegan’s office, City Council and developer Live Oak Contracting, Deegan’s administration said on Nov. 26 it would sit down with Live Oak for discussions designed to help facilitate the sale.
At issue is the city’s claim that the current owner, Steve Atkins of SouthEast Development Group, owes more than $800,000 in fines stemming from code violations that have accrued since he purchased the buildings in 2013. The claims led to a lien being placed on the property, which is an impediment to the Trio being sold.
On Nov. 14, the city refiled a foreclosure lawsuit against Atkins over the alleged code violations after the latest of several rounds of negotiations between the city and SouthEast dead-ended.
Mike Weinstein, Deegan’s chief of staff, said the discussions with Live Oak president and CEO Paul Bertozzi would involve the city delaying its pursuit of the fines in return for Live Oak committing to a timeline for redeveloping the Trio and then hitting its targets.
“There’s going to be milestones,” he said. “He’s going to have to buy the property by a certain date, which is the end of the year, then we’re going to negotiate when we have to have a development agreement, when he’ll have to start construction, when he’ll have to complete construction. If those milestones aren’t met, then we’ll go back and aggressively pursue the forfeiture.”
If the code violations are resolved, Weinstein said the next steps would include negotiating a new redevelopment deal and incentive package between Live Oak and the Downtown Investment Authority.
Council action
For Council’s part of the agreement, it passed a nonbinding resolution urging Deegan’s administration to go to the table with Live Oak as opposed to approving an ordinance that would waive the lien and fines after four years if the developer corrected the violations.
Council approved the legislation, Resolution 2024-0965, on a 17-2 vote after Bertozzi said the company’s lenders supported it.
Council member Kevin Carrico filed related legislation, Ordinance 2024-0966, that would require the lien waiver. He requested no action on it during the Nov. 26 meeting, but Council could take it up if the administration-led negotiations don’t bear fruit.
A 2006 city ordinance established procedures for the city to waive liens and fines after a developer addresses the underlying code violations.
“We expect an update from the administration probably in the Finance Committee (meeting on Dec. 3),” Carrico said. “If the groups aren’t agreeing in good faith on what we discussed, then we can still pass the ordinance.”
During a discussion of the Trio at the Nov. 25 meeting of the Council Special Committee on the Future of Downtown, Weinstein said the administration considered the ordinance an overstep of Council’s separation-of-powers authority.
After the Council meeting, Weinstein said the resolution was “the only way forward’ for the administration.
“A resolution encouraging us to act a certain way is absolutely OK,” he said. “An ordinance dictating how the executive branch functions and carries out its responsibility, that’s not appropriate. So if an ordinance passed dictating how we were going to do our function, we were backing away.”
Weinstein said that under a timeline established by Live Oak and its lenders, the agreement on the code violations needs to be reached by Dec. 6 to keep the potential transaction on track for closure by the end of the year.
The two no votes on the resolution came from Council members Terrance Freeman and Rory Diamond. Freeman said he voted no because he was unable to ask if the development team would still include SouthEast after the transaction.
Before Freeman could ask the question, Council voted to invoke a procedure that cuts off discussion in favor of an immediate vote.
Diamond did not explain his vote.
A new development team
Weinstein said he believed Live Oak would bring in a new development team.
“My understanding is the potential new owner will have a different group of people as opposed to the current group of people that has been working on this now for more than a decade,” he said. “That’s what some of the Council members are interested in, and that’s what the mayor’s interested in as well, that this new effort is going to be run through different people.”
Live Oak, which entered into a partnership with Trio owner Atkins and SouthEast in September, announced at the Nov. 25 meeting of the Council Special Committee on the Future of Downtown that it was negotiating to buy the Trio. That news came on the heels of the Deegan administration announcing it had permanently cut off negotiations with Atkins and SouthEast after several failed attempts to reach a redevelopment agreement. That prompted SouthEast to say it also was through talking to the administration and would deal only with Council.
Atkins proposed resurrecting the property as mixed-use development with a hotel, residential units and restaurants.
The resolution includes a request for Live Oak 13 Ancient City Living LLC, the prospective buyer, to demonstrate it has the “necessary financial and other resources” to bring the property into compliance and carry out the renovation “consistent with comparable incentives that have been advanced by the Downtown Investment Authority.”
Live Oak emerged as a development partner and investor in the Trio in September 2024, prompting hopes of a breakthrough in negotiations. Talks between the city and SouthEast had stalled several times, partly over concerns that Atkins hadn’t brought enough private equity to the project and was overreliant on city incentives.
Live Oak’s entry led to another round of talks in which the city and the development team agreed in principle to a set of terms for a new deal.
The mayor’s office said the developers came back from those talks with a proposal that ran counter to the terms by again seeking a high percentage of city incentives and requesting them as front-end grants that would put the city at undue risk if the project stalled.
Failed past efforts
SouthEast said it worked diligently to craft a new deal and was abruptly cut off by Deegan’s office. The developer said it was unfair to use incidents of vandalism and graffiti at the Trio as grounds for foreclosure.
Atkins has owned the Trio since 2013, and twice received Council-approved incentives for the project. In 2017 and 2021, Council approved respective packages of $5.8 million and $26.6 million, but construction fizzled both times.
The original incentive package involved only restoration and reuse of the three buildings. In later versions of the project, Atkins and SouthEast added new construction for a hotel and residential units.
Since 2017, the proposed costs of the project have climbed from $44.6 million to $211.7 million in the development team’s latest proposal to the city, which came in October 2024.
According to a city summary of the Trio negotiations, the development team’s asks for incentives grew from 13% of the total development cost in 2017 to 45.7% in October 2024.
As part of the October 2024 proposal, the developers sought $96.8 million in incentives, or nearly 17 times the amount in the agreement seven years ago. The total development cost in the latest proposal is 4.7 times that of the 2017 agreement.
The scope of the project has changed since 2017 to include not only adaptive reuse of the historic buildings but new construction for the hotel and residential element.
The Trio comprises the First National Bank Building, Bisbee Building and Florida Life Building and the southwest corner of Laura and Forsyth streets. The structures were built from 1902 to 1912 and are among the last remaining unrestored buildings constructed during the years immediately following the 1901 fire that destroyed much of Jacksonville.