After tweaks from the development community, the Downtown Investment Authority greenlighted a new residential incentive program focused on activating the urban core.
The new program takes aim at increasing both residential density and retail existence in downtown. The incentive is applicable to the “core” — a limited geographic area on the Northbank defined as Broad Street to the west, State Street to the north, Liberty Street to the east and the St. Johns River to the south. The program will be limited with a goal of 1,500 units in mixed-use developments in the next three years to activate downtown.
The program answers the Special Committee on the Future of Downtown’s call for a focus on concentrated residential growth, specifically from Council Member Joe Carlucci.
The incentives would combine a completion grant, paid out at the issuance of a temporary certificate of occupancy, and a recapture enhanced value grant paid over a maximum of 20 years.
Developments under this program will also not be subject to the return on investment requirement of 1:1 and can’t be used in conjunction with the Downtown Preservation and Revitalization Program.
The maximum amount for a completion grant will depend on the number of residential units per acre, which is the main change in the program following further input from developers like Bryan Moll CEO of Gateway Jax and Billy Zeits of Corner Lot, who spoke at the October Strategic Implementation Committee where the program was first presented. The amount per unit was bumped by $5,000 per tier.
The incentive amount per unit increases in a tiered, progressive approach meaning each tier is additive to the previous. A 50-unit development would be eligible for $21,000 per unit: $20,000 for each of 40 units plus $25,000 for each of 10.
An exception to the aggregation approach is for the tier that is 176 units or greater per acre. That tier anticipates Type 1 or Type 2 construction techniques and is awarded a base rate of $50,000 per unit when that condition is true and remains eligible for bonuses for two- or three- bedroom units as shown below. If not using Type 1 or Type 2 construction, the projects would be eligible for funding at a base rate of $30,000 per unit.
The program that passed the DIA Board Wednesday included extra funds for Type 1 and 2 construction, something that was not accounted for in the initial proposal. It also added a garage parking bonus to support construction of structured parking meeting requirements of the Downtown Overlay Zone.
It retained the size bonuses, in which two-bedroom units receive 1.5 times the base amount and three or more bedrooms receive double the base amount, and projects that provide 20% or more units of two- or more-bedroom units are eligible for accelerated payments.
Besides density, the program encourages workforce housing as well. The potential program would give a boost not to exceed more than 20% of total units to incentivize those with rents capped at the Florida Housing Finance Corporation limits for those making less than 80% or 120% of the area median income. For a single bedroom unit, the program would provide $15,000 at the 80% AMI level and $12,500 at the 120% AMI; a two-bedroom apartment could receive $22,500 or $17,500 dependent on the AMI.
Riverfront, creekfront or developments adjacent to the Emerald Trail are not eligible for the affordable/workforce housing bonus. After a total of 400 workforce units have been awarded with this boost, it will no longer be available unless further approved by City Council.
To qualify for any of this funding, all developments must adhere to street-level activation requirements instead of retail requirements in the previous draft. Such requirements include not decreasing transparency or square footage of first floor space designed for visible use of any existing property,
Percentages of necessary activated, first-floor space will be calculated after deduction of parking garages or lots as well as considering whether the project includes both new construction and renovation or rehabilitation — another provision added following discussion at the October Strategic Implementation Committee.
Properties immediately adjacent to the river must provide a minimum 3,000 square feet of restaurant or retail space directly accessible to the public from the Riverwalk, at the street level, or on the rooftop or similar height advantaged location as approved by the RE&PD Committee and DIA Board.
The unanimous yes from the DIA Board Wednesday adds another incentive program available in the Northbank CRA, recommending City Council consider adoption of the Core Residential Program and funding of the completion grants that will result.
By Emma Behrmann, Reporter
Jacksonville Business Journal