The proposed Gateway Jax tower with luxury condominiums and hotel rooms in Riverfront Plazawould sell condos for an average price of $3.5 million apiece in another test of what price people will pay for high-end residences on the downtown riverfront.
The Gateway Jax tower would join the Four Seasons Hotel and Residences in offering condominiums at top-dollar costs overlooking the St. Johns River.
Downtown Investment Authority board members discussed Gateway Jax's planned asking price for the condos while deciding Sept. 16 to support an incentive package containing a $20 million cash completion grant and up to $35.4 million in property tax rebates over 20 years. The incentives would be paid only after the tower is built.
DIA board member Scott Wohlers
said Gateway's pricing for the condos at a rate of $1,400 per square foot is "very optimistic" but the only way to know what crystal ball scenario is right will be to offer Gateway "the best chance to develop a nice project on this parcel."
"We can always find the reason why it won't work, but I guess we have to decide together as a board, 'Do we want to take the risk together and see if something comes due here in this particular piece of land or not?'" Wohlers said. "And I think it's the risk we're going to have to take."
Gateway Jax CEO Brian Moll said the developer and its investors expect buyers will be there for the condos.
He said he was involved in a similar situation in Tampa with development of Water Street Tampa that "blew away the top of the market" at that time by selling residences at a premium for luxury lifestyle features.
"We feel very confident ... that this is the right project for this location," Moll said.
Four Seasons Private Residences Jacksonville, which is on track to open in 2027, is already on the market for luxury condominium sales. Four Seasons announced in Januarythe price for buying one of its 26 residences would start at about $4.7 million.
The price for the Gateway Jax condominiums would be lower than at the Four Seasons, but it still would be a stretch for the market in Jacksonville.
Gateway Jax representatives said the strategy will be to pre-sell at least half of the 51 condominiums slated for the Riverfront Plaza tower before starting construction.
The development agreement with the city would give 21 months for Gateway to do the pre-sales after the deal wins City Council approval. The Downtown Investment Authority would set aside $20 million for potential payment of the cash completion grant, leaving the money off-limits for use on other downtown projects while the city waits to see if Gateway Jax hits its pre-sale target.
"I think given the size and scale and the prominence of this project, it's a risk worth taking based on the analysis we've done," Downtown Investment Authority CEO Colin Tarbert told the board.
If Gateway Jax does not pre-sell enough condos to move forward with construction, it could sit down with the city to rework the project. The city also would have the option of paying $6.95 million to Gateway Jax for the 1.1 acre parcel that Gateway Jax acquired last year in a swap for a two-story office building that became part of the just-opened UF Jacksonville campus in downtown.
In addition to 51 condominiums averaging 2,524 square feet, the Riverfront Plaza tower also would have 165 hotel rooms and a 5,000 square foot sky view terrace with restaurants open to the public.
Gateway Jax has not yet announced who would operate the hotel.
Two DIA board members said during discussion of the Gateway Jax project that seven of the 26 residences at Four Seasons Private Residences Jacksonville have been presold so far.
Shanna Collective, which is leading the development of the Four Seasons residences, said in a Sept. 17 statement that its team did not provide that figure and it "does not reflect current sales."
"While we don't disclose specific sales figures, we are pleased with the response since officially launching sales to the public in January and with the continued interest from prospective buyers and our active pipeline," the statement said. "The Douglas Elliman Development Marketing team remains focused on engaging buyers as we work toward meeting our target sales goals ahead of the project's anticipated 2027 opening."
This article originally appeared on Florida Times-Union: Price for a Riverfront Plaza tower condo would average $3.5 million
