Rather than trading two publicly owned riverfront properties for an office building that would be provided for the University of Florida graduate center campus in LaVilla, Jacksonville City Council member Ron Salem is proposing that the city buy the building outright.
At the Feb. 19 meeting of the Downtown Investment Authority board, Salem said he was filing legislation for the city to offer $4 million to purchase the Interline Brands Inc. building at 801 W. Bay St.
Later in the meeting, the board voted 5-2 in favor of the land swap, in which the city would provide property east of Riverfront Plaza, the city park now under construction, for the Interline building. Riverfront Plaza is the site of the demolished Jacksonville Landing.
With the vote and Salem’s legislation, the city is now pursuing the building on two different tracks.
Board members voting yes were: Chair Patrick Krechowski and members Sondra Fetner, Micah Heavener, Jill Caffey and John Hirabayashi. The no votes came from Scott Wohlers and Cameron Hooper.
The sale
The Interline building’s owners, the developers of the Gateway Jax project, purchased the property in October 2024 for $4 million from HD Supply Facilities Maintenance Ltd. of Atlanta.
Salem described the $4 million offer as a starting point for negotiations between the Gateway Jax team and Council members.
He said he formed the legislation after discussions with business operators and community leaders and with concerns about the exchange.
Wohlers and Hooper both supported an amendment to reject the land swap, with Hooper saying the process was being rushed and that the board was acting on insufficient information about Gateway’s business plan for the site.
Gateway committed to developing a tower with a hotel, residential units, retail and restaurants there. The development would be in line with plans developed by Chicago-based Perkins & Will, which won the contest to design Riverfront Plaza. Perkins & Will included a conceptual plan for an L-shaped building that includes a rectangular, 17-story tower structure and an attached six-story portion.
“It’s impossible in the current environment,” Hooper said. “The return on cost has got to be abysmal. It’s probably negative.”
Gateway: Property worth $8 million
During a presentation to the board, Gateway Jax principal Bryan Moll said the developers believe the property is worth $8 million, based on a recent CBRE appraisal. The DIA places the building’s value at $5.5 million, roughly the same value as the two properties the city proposes to swap. Those properties are in the northeast corner of Riverfront Plaza, now the name of the Landing site, and an adjacent parking lot to the east.
Salem’s proposal drew an immediate response from Mike Weinstein, Mayor Donna Deegan’s chief of staff, who said the mayor remained supportive of the land swap and saw “no reason to go back into our coffers and commit additional public money” for the campus.
Weinstein suggested that Salem was overreaching his authority as a member of the Council, the legislative branch of Jacksonville’s city government, in negotiating with Gateway.
“Nineteen part-time legislators who can’t talk to each other are not necessarily set up for negotiations,” Weinstein said, referring to open meetings laws that bar Council members from having offline conversations on official city business out of the public eye. “That’s the executive branch’s responsibility. There are a few members on this Council who continue to try to chip away at what the mayor is able to do and is authorized to do. And we’re just not going to let it pass.”
Salem responded to Weinstein's comment in a Feb. 20. text message.
"The Jacksonville City Council for the almost six years I have been a part of it have performed the role the Duval County voters elected us to perform," Salem said. "Since being elected, Mayor Deegan has sought to undermine the legislative process and has developed a disdain for accountability in her administration. This is what we were elected to do, and my city colleagues and I have not forgotten who we work for."
The Council committed $50 million in the spring of 2023 to bring the campus to Jacksonville and Deegan committed an additional $50 million in conjunction with the university announcing plans for the Florida Semiconductor Institute to be part of the campus.
Moll said the Gateway team, which includes JWB Real Estate Capital and DLP Capital, would entertain an offer to sell the building but also would move forward on the land swap by preparing its proposal for the disposition and doing due diligence on the Riverfront Plaza property.
“I think fundamentally we share in the same goal of getting this done so that UF can bring students to Downtown in the fall,” he said. “We would love to be able to have the opportunity to develop in Riverfront Plaza. If that doesn’t work out for whatever reason, the alternative is OK.”
Asked whether Gateway would consider selling the building for $4 million, Moll said: “We believe the value of the building is $8 million, and we have an appraisal that was done by CBRE, obviously a very reputable firm, that backs up that number.”
Responding to a concern voiced by members of a Council committee before the DIA board meeting, Moll said the developers would need a maximum of $20 million in completion grants to make the Riverfront Plaza development financially feasible. He said the project would likely also require an undetermined amount of Recapture Enhanced Value grants.
A REV grant is a refund on ad valorem tax revenue generated by a new development, whereas completion grants are paid from the city general fund.
Campus critical
However, Moll said, the partners believe the campus is critical for Downtown revitalization, “and we are not going to stand in the way of UF.”
Weinstein said Deegan supported the land swap partly to spur development at Riverfront Plaza. Construction is underway on the first of two planned phases of construction, with the second phase spanning the eastern portion that includes the site of the proposed Gateway development.
“We need a building. We need a hotel. We need some things that are active down there,” he said.
In explaining his support for the exchange, Krechowski said he didn’t want to “look out my window and see a beautiful park with an empty, dirty unoccupied space that has a chain link fence around it.”
The DIA board’s agenda included the land swap among DIA resolutions to place four city-owned parcels up for disposition for the UF campus. The board voted 7-0 on the dispositions for the four properties and for a disposition of the Interline building contingent on the city acquiring it.
The properties include the historic Jacksonville Terminal train station, the connected newer portion of the Prime F. Osborn III Convention Center and land stretching west to Interstate 95, an unimproved lot north of the train station and a neighboring parking lot to the east across Park Street.
The board’s vote on the land swap allows the DIA to put the riverfront properties up for disposition. As with all dispositions of city-owned properties Downtown, the DIA will take bids from any party.
Boyer can negotiate
The resolution for the land swap, Resolution 2025-02-04, allows DIA CEO Lori Boyer to negotiate a redevelopment agreement with Gateway “if no alternate responsive and qualified proposals are received, or if they are determined by the CEO to be lower in value or unresponsive.”
The resolutions for the train station and the convention center dispositions provide options to acquire the properties. They contain contingencies that UF could not exercise the options for several years, so that the convention center can be operated in the near term before being moved.
Together with the Interline building, the properties would encompass about 23 acres.
Kurt Dudas, UF vice president for strategic initiatives, told the DIA board that the Interline building was “the most important right now” for the university’s plans for the campus. Those plans include using the building for an architecture master’s program in August 2025. The program operates out of the Groover-Stewart Building at 25 N. Market St.
The DIA aims to bring the disposition and redevelopment agreement to Council in May to meet a mid-summer deadline for UF to close on the property for use beginning in August.
This story has been updated with a comment from Ron Salem and information from Bryan Moll about incentives needed to develop a tower at Riverfront Plaza.