Thrive
Consultant: Sugar Hill, Rays/Hines proposals are top contenders
The inventory of office space and affordable housing to the tax benefits for the city were all factors considered by consultant HR&A Advisors in its evaluation of the Tropicana Field/the Gas Plant District redevelopment proposals.
This week, the city received the evaluation report from HR&A, the third-party consultant hired by the city, that weighed the strengths and weaknesses of each of the four development teams, putting the Tampa Bay Rays and Hines joint proposal and the Sugar Hill Community Partners proposal at the top of the list. The two teams checked the boxes for many of the city’s requirements and needs as the other two contenders – Restoration Associates and 50 Plus 1 Sports – lacked certain information in their proposals.
According to the 78-page report, HR&A reviewed the teams’ mix of members and previous experience for both the master developers and the consultant teams.
The consultant also compared the proposals side by side, highlighting the financial offers and public subsidy requests, elements of each component such as office space and residential buildouts, community benefits, job impacts and the prospective timelines.
Renderings from the four competing development teams. All slides and image are from city documents.
The full HR&A review can be found here:
Comparing notes
All of the information is directly from HR&A’s review.
The Sugar Hill team is the largest team among all proposals, with the most extensive local presence. The team, which includes JMA Ventures, the Machete Group, Blue Sky Communities and many others, demonstrates a history of collaboration among team members. Sugar Hill is also proposing the largest office program, equivalent to 125% of the projected 20-year absorption within a proposed 12-year buildout. It would deliver more than 3 million square feet over a 20-year projection. However, this is contingent on their ability to deliver and the market to absorb the additional square footage projected in a relatively short period.
The Rays have the largest development budget – creating the most overall total construction jobs, but it has the longest buildout. The Rays/Hines also have the greatest equity commitment and land valuation estimate. The team has the smallest percentage of onsite affordable units, but it is slating $15 million for use for offsite affordability units and initiatives.
HR&A said the 50 Plus 1 team has not demonstrated experience as a developer, including not having completed a similar large-scale development. They also do not identify who would lead the affordable housing development or list any previous project experience in developing income-restricted housing. However, Both Sugar Hill and 50 Plus 1’s onsite affordable residential units comprise roughly half of the overall residential program (47% or 2,291 units for Sugar Hill, and 50% or 3,374 units for 50 Plus 1).
Restoration Associates’ proposal is also missing information, including detailed descriptions of experiences for members of the consultant team. The design team also does not mention the ballpark development experience or include a landscape architect. With the exception of Restoration Associates, all proposals incorporate key design elements that intend to connect the site to surrounding neighborhoods, including street grids that reinstate the district’s street grid, and connection to the Pinellas Trail and Campbell Park. However, Restoration Associates has the shortest timeline for delivery, delivering 6.48 million square feet within 10 years.
The play by play
HR&A’s chart showing the economic impacts of each proposal.
The financials
Rays and Hines: The team would offer $64.5 million. The land valuation is $97 million. Their total public funding request (assuming city share per property tax millage) would be $89 million. There would be $150 million in infrastructure costs.
Sugar Hill: Estimated land price offer of $41.65 million. The land valuation is $48 million. Their total public funding request would be $118.6 million. There would be $125 million in infrastructure costs.
HR&A’s executive summary of the financials.
Restoration Associates: The team declined to provide a land acquisition offer. An estimation of infrastructure costs was not determined.
50 Plus 1 Sports: The team lacked the information for a land acquisition offer and an estimation of infrastructure costs.
The breakdown
The breakdown of what each of the proposals offer.
St. Petersburg Mayor Ken Welch is expected to announce his selection of the master developer at the 2023 State of the City address Jan. 30 at City Hall.
The city is collecting feedback from the public regarding the proposals through Jan. 23. People can submit feedback online or at pop-up stations.
Alan H DeLisle
January 22, 2023at12:49 pm
These are some of the worst proposals I have seen in my career. Based on the proposals, the city will end up spending all the money on infrastructure and most of the money on parking without any commitment to the development other than the ballpark. The Rays and the other proposers, mitigate all their risk and shift it to the city. Midtown, compared to the Rays, was responsible for infrastructure costs beyond the dedicated $75 million TIF, had all the parking paid for, had a first phase commitment of 300,000 sf of retail and office development, paid for the land upfront and was delivering a lot more affordable housing on site and had a clearer, better defined CBA. The city would be wise to negotiate a deal upfront with the Rays (city doesn’t even know if they will follow through if selected) and/or Sugar Hill before they select anyone. Otherwise, the city will be paying double or triple for the development (vs. Midtown proposal) of the site prior to even finalizing how much they pay for the stadium. The Rays have the city right where they want them. This will be written about for a very long time on how not to do a transformational project.
HAL FREEDMAN
January 22, 2023at12:53 am
Some takeaways:
“The Rays have the largest development budget – creating the most overall total construction jobs, but it has the longest buildout. The Rays/Hines also have the greatest equity commitment and land valuation estimate. The team has the smallest percentage of onsite affordable units, but it is slating $15 million for use for offsite affordability units and initiatives.” Note: The Rays will get a portion of the proceeds they are providing.
Based on tables, Rays/Hines and Sugar Hill are reasonably equivalent. The tables do not take into account the refund the Rays will get.
The R/H proposal has smallest affordable housing program.
The R/H proposal has a 2040 completion date; SH is 2035.
My guess…the Rays will build their stadium by 2027 and drag their feet on the rest of the project. 10 years from now, we’ll have a stadium, some other income-producing (for the Rays) components, and parking lots.
The City doesn’t have the balls to say “no” to the R/H proposal for fear of losing the Rays.