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Commercial Real Estate
Business Observer Tuesday, Apr. 12, 2022 5 months ago

Bradenton officials consider lucrative offers for City Hall

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Bradenton City Council will decide in coming weeks whether to sell its waterfront building.
by: Louis Llovio Commercial Real Estate Editor

Bradenton’s City Council could consider a proposal within the next few weeks to sell its waterfront city hall building that houses the municipality’s administrative offices and police headquarters.

City leaders have been in discussions about the possibility for some time and what city council members will consider is how the bidding process would go about and what a potential sale could look like. Basically, City Administrator Rob Perry will propose a road map and the council will decide how to move forward.

The city council is likely to begin working on how the process will work at its April 27 meeting.

Bradenton City Hall is on a prime 3.9 acre-lot on the Manatee River, near the marina, pier and recently expanded downtown Riverwalk. It's the kind of property where it’s easy to envision a major luxury waterfront condo development or hotel, much like those that dot downtowns across the region.

For city leaders, the idea that city hall sits on such a valuable piece of property is unthinkable. They see it as a lost opportunity to both increase property tax collections and to bring much-needed life to downtown.

The property is so valuable Perry says he’s already received two unsolicited offers — each exceeding eight figures. How those offers will be handled will depend on how city council decides to move forward.

As discussions have continued, city staff has completed some of the background work, including getting an appraisal that valued the property at $10.46 million.

“And so now we’re at a point where basically, we have these unsolicited offers, we have an appraisal, we have a legal opinion, we have a space study, we’ve done some architectural engineering reviews and the like,” he says. “It’s time to make some decisions and the decisions are, ‘Do you want to consider disposition this property?’”

If there is any dissent, it’s a concern that the city won’t maximize its opportunity.

At a March 24 joint meeting between the Bradenton City Council and Manatee County Commissioners, commissioners asked Perry whether there would be any parameters set to make sure the property is sold for top dollar and for its best use.

“Is there any specifics, like deed restrictions, that you are tying to the development of the property once sold?” asked board chairman Kevin Van Ostenbridge. “We don’t want a storage unit for instance.”

While that drew laughs, fellow Commissioner George Kruse echos Van Ostenbridge's concerns. 

Kruse says the county “massively underuses” the waterfront compared with other localities and the potential sale is an opportunity to set a precedent for how that area could be developed in the future. Along with City Hall, a county-owned public library and a former jail sits on or right next to the waterfront.

He wondered if the city had considered rezoning the property and looking at height restrictions and density before putting it on the market. “Whoever is going to buy it is going to factor in going through that process. And being able to buy something that’s already ‘as of right’ makes it that much more certain and therefore much more valuable.”

In an interview with the Business Observer, Perry says current zoning allows for an eight-story building and a developer could go higher if the development meets certain qualifications.

One possible way for the city to keep more control of what will come is to set parameters for what kind of project goes on the property when it opens the bidding process. Perry rejects that strategy. 

While the city has the right to set those parameters, Perry believes it’s important to keep the process wide open. “The problem is, the more restrictions you put on it, the less proposals you’ll get. And I think it’s important to let it be transparent. Let it be inclusive, so that we can consider all proposals,” he says.

Bradenton is not the first locality to go down this road of late. Sarasota County puts its administration building up for sale last year because maintenance costs had grown too high. While the reasons to sell may differ, the process Sarasota County used could serve as a model for Bradenton.

Sarasota County commissioners opened the bidding to developers and received six, each for over $20 million, in August. After some back and forth in commission chambers, county staff negotiated with bidders, narrowing the number of bids down to one. At that point, commissioners, who still had the right to back out if the deal didn’t meet its criteria, asked for specific concessions that were granted.

The $25 million sale to east Manatee County-based Benderson Development was approved Nov. 15. The county acquired the building and two adjacent properties, and the developer allowed Sarasota County to rent the property back for $1 million per year while it builds a new administration building.

It's too early to see if Bradenton will take a similar path or go in a different direction. One important factor that must be decided during the process is where the city will move its administrative offices and how much it cost if a new building must be built. Then there is the matter of where the police department will go.

Before any of that can happen, though, city council will have to agree to sell the building and come up with a plan to execute the sale.

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