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Redevelopment
Recycled Real Estate
A state program and the sizzling real estate market are boosting the redevelopment of so-called "brownfields" sites.
In its heyday, Ocala grew prosperous catering to the tourists who flocked to the pristine artesian waters of nearby Silver Springs. But Silver Springs' glass-bottom boat rides, a popular attraction since the late 1800s, were no match for Disney World and the other theme parks that sprouted 75 miles to the south. Ocala's tourism industry disintegrated.
Over time, other businesses also left town, and the quaint city in the heart of Florida horse country bottomed out in the mid-1990s, when vagrants loitered about vacant storefronts in a downtown area where a third of all buildings were abandoned or dilapidated. "Downtown Ocala was really in a state of decline," recalls longtime Ocala resident George Roberts.
In 1997, the state Legislature created the Brownfields Redevelopment Program, a set of financial incentives and liability protection for localities, developers and bankers willing to redevelop properties that are contaminated or simply have fallen into disuse. Roberts and others in Ocala -- including members of the Downtown Development Commission, the North Magnolia Merchants Association and the Ocala/Marion County Economic Development Corporation -- saw the potential. Since then the city has revitalized entire blocks and established itself as a best-practices paragon in brownfields redevelopment. The program "offered us a chance to resurrect downtown Ocala," says Roberts, who heads the city's brownfields program, Renew Ocala.
While most associate the term "brownfields" with toxic substances, a property doesn't have to be tainted to qualify, Roberts explains. "A lot of people hear 'brownfields' and say 'Oh no! Contamination.' " Sometimes, he says, a building simply has a bad image, citing the case of an old Winn-Dixie store along Ocala's North Magnolia Avenue that sat vacant for five years.
The dilapidated supermarket caught the eye of the owners of a mortgage brokerage looking to build a processing center. But concerns about the property's environmental status threatened to nix the deal. Nearby were a variety of service and repair businesses involved with everything from gas engines and car batteries to air conditioners and swimming pool chemicals.
Ocala city officials designated the property a brownfields site to access state and federal funding for an environmental assessment that found the property wasn't contaminated. "Most of it was a perception problem," says Roberts. "That's the whole idea behind brownfields -- to remove the perception."
The mortgage brokerage purchased the property, investing $75,000 in its renovation. The company more than recouped that outlay with the $250,000 in "Job Bonus Refunds" -- an incentive under the Brownfields Redevelopment Program -- it received from the state for creating 100 jobs.
Among Ocala's other success stories: An old abandoned auto service center close to the downtown business district became a much-needed parking lot. A former meat-packing facility northeast of downtown that had been abandoned for almost 10 years was demolished and cleaned up to make way for a new office complex. A dilapidated corner building that once housed an electric motor repair business was knocked down to make way for a greenway along a major road through the business district. Another rundown area several blocks to the north also was developed into a park, anchoring a revitalized section of town that has earned the moniker "Ocala's Miracle Mile."
"They've had all kinds of success stories on small parcels of land that have had major impacts on the community," says Roger Register, brownfields liaison for the Department of Environmental Protection.
In 1998, the first three brownfields sites in Florida encompassed 5,361 acres. Today, brownfields encompass nearly 76,000 acres, and in five years, the number of state-designated brownfields has grown from 39 to 113. Besides Marion County, others that have jumped on the brownfields bandwagon include Pinellas, Hillsborough, Duval, Broward and Miami-Dade counties, to name a few.
With more than 50 brownfields projects, "Clearwater's had one of the most successful programs in the southwest," says Miles Ballogg, a brownfields and economic development director for Clearwater-based TBE Group. The city has converted an old junkyard into a fire station, transformed a former Cadillac dealership into a shopping center complex anchored by Publix and turned an abandoned gas station into a free health clinic for the public. "We see it in terms of lowering the bottom line for development," says Ballogg, Clearwater's former economic development programs manager and brownfields coordinator. "That's what the program is about. To take sites that people would otherwise turn away from and throw in enough resources and incentives to make them attractive."
Market boon
Florida's booming real estate market also is driving more private developers into the brownfields development arena. "Normally a developer would walk away from anything that had environmental contamination," acknowledges Tampa developer Doug Weber, but the president of Synergy Properties says he decided to build a luxury apartment building on a brownfields site in Tampa's Channelside district anyway.
BUSINESS BOOST: "For us, the hot real estate market has been a boon," says Terry Manning, a senior planner and brownfields coordinator for the South Florida Regional Planning Council.While four decades of industrial use had left the property in less than pristine condition, it's in a prime location. "It's the largest piece of land in Channelside, which is the hottest development in the Tampa Bay area," Weber says. Besides the tax advantages and other financial incentives, "I'm getting a great piece of property and location that other people don't want to take a shot at," says Weber, who is planning to build 418 units on the 8.5-acre lot that will be called Seaport Channelside.
Attorney Michael Goldstein, president of the Florida Brownfields Association, says today's brownfields investor is a different breed from those who first ventured into brownfields. "Early activity really was characterized by entrepreneurs who had a very, very high tolerance for risk and a high level of sophistication about emerging changes to the regulatory culture in 1995," Goldstein explains. Today, the savvy entrepreneurs are being crowded out by conventional developers, who methodically pursue brownfields. They aren't "chancing" into the sites. They're actually going out and looking for them.
"For us, the hot real estate market has been a boon," says Terry Manning, a senior planner and brownfields coordinator for the South Florida Regional Planning Council. Contaminated or not, she says, property is selling at or above market value, and that's been good for the brownfields business. "If I can come up with more vacant land, I can have developers buying property right and left."
Even with 32 sites behind him, and a nearly resurrected downtown, Roberts says there's still more to be done, especially in west Ocala where many neglected businesses have the potential to be developed and become more profitable and beneficial. "We'll be applying for another assessment grant in the fall," says Roberts.
Before & After
CLEARWATER: For decades, the junkyard on the banks of Stevensons Creek in northwest Clearwater was little more than an eyesore, a graveyard for abandoned cars and piles of tires. The city of Clearwater eventually acquired the land and began a cleanup. Using EPA brownfields assessment funding and working closely with the state Department of Environmental Protection, city officials transformed the environmentally contaminated auto salvage yard into Fire Station 51. The city is currently working on cleaning up an adjacent lot and with assistance from the Army Corps of Engineers is preparing to restore the creek.
MIAMI: In 1998, Boca Raton developer Bill Cocose plunked down $5,000 for two parcels of tainted property in Miami's downtrodden Wynwood neighborhood. A dry cleaning operation on the site years earlier had left a low-level toxic stew in the soil, and bankruptcy proceedings had complicated matters further. Signing the first ever Brownfields Site Rehabilitation Agreement with the state, Cocose was able to execute a "risk-based" cleanup and put the property back into use. A cement plant now occupies the west parcel. The east parcel also was sold and is being developed into an upscale storage facility.
WEST PALM BEACH: Four years ago, using an EPA grant, Terry Manning helped establish a revolving loan fund for brownfields cleanups. "With my first loan, we worked with an affordable housing developer," says Manning, a senior planner and brownfields coordinator for the South Florida Regional Planning Council. The $800,000 provided about half the funding for the cleanup. The developer was able to get construction and other financing elsewhere. In the end, a contaminated golf course was transformed into a 264-unit low- and moderate-income apartment complex in West Palm Beach called Malibu Bay Apartments.
Business Beat - Week of May 3rd
