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Coffee Talk
Business Observer Friday, Apr. 1, 2005 16 years ago

Coffee Talk (Sara/Mana)

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Fairgrounds option faring-well: With Tim Clarke, committee leader for the Sarasota Chamber's conference center proposal, and Virginia Haley, executive director of the Sarasota Convention and Visitors Bureau, dead set against developing a conference center at the Fairgrounds, why are city and county leaders so enamored by the site?Sarasota 'Salvation' site sold: John and Jack Cox, E. Russell James, Donnie McDonough and Mario Comparetto purchased the old 52,500-square-foot Salvation Army homeless shelter, near Fruitville Road and Lemon Avenue, for $1.5 million.Walbolt re-elected chair
by: Adam Hughes Staff Writer

Coffee Talk (Sara/Mana)

Fairgrounds option faring-well

With Tim Clarke, committee leader for the Sarasota Chamber's conference center proposal, and Virginia Haley, executive director of the Sarasota Convention and Visitors Bureau, dead set against developing a conference center at the Fairgrounds, why are city and county leaders so enamored by the site?

It all comes down to money and who pays for any future conference center deficits.

As part of hotelier John Hammons' proposal for an arena, conference center and 300-room hotel on the fairgrounds site, Hammons would manage the conference center and make up any operating deficits.

Based on studies by consultants, the conference center would likely produce a minimum deficit of $650,000 annually. Over 10 years that on-going deficit would hit local coffers and/or tourist tax revenues by $6.5 million, excluding any possible interest payments required for the debt service. That debt is a variable figure.

"We are proposing this as a way to get that monkey off the city's back," says J.C. Ebach, who works in real estate site selection for the John Q. Hammons Industries.

Although details are still being negotiated, Hammons' current proposal is for the city and county to fund the construction of the exhibition arena and conference center, estimated at $26 million and $29.8 million, respectively.

Those figures also include developing 2,000 parking spaces and other redevelopment at the fairgrounds. The Sarasota County Fair Board would then donate land at the fairgrounds site to Hammons so he could build a $40 million Embassy Suites or Marriott-branded hotel.

"We weren't opposed to the Chamber's (proposed) site," Ebach says. "But the differences between that site and this one are huge. In an ideal world with no price constraints everyone agrees that a waterfront site would be the best location. But the site they were proposing was only 4 acres, and they were limited in buildings heights. This site gives us 65 acres to play with."

Removing the debt service element, Hammons argues, would allow the conference and arena to be built by increasing the bed tax by 1.5 cents or less as opposed to a 2-cent tax in the Chamber proposal.

As for why Hammons would commit to such a loss, Ebach says the hotelier operates about 60 conference centers nationwide allowing him economies of scale in operations and marketing. In addition, it is assumed that much, if not all, of the deficit could be recouped through revenue from the host hotel.

The reception so far to the proposal appears good. Of the four city commissioners who returned Coffee Talk's calls, all reported considering the idea, but wanted to see more detail before they would approve it.

"I was very impressed with the Hammons/Ebach proposal," says Mayor Richard Martin. "It certainly promises a better long-term situation. It got my attention."

Sarasota 'Salvation' site sold

John and Jack Cox, E. Russell James, Donnie McDonough and Mario Comparetto purchased the old 52,500-square-foot Salvation Army homeless shelter, near Fruitville Road and Lemon Avenue, for $1.5 million.

The new owners were not the only party vying for the high-profile vacant building over the years. In 2003, the Salvation Army rejected a purchase attempt by Tampa-based hotel and commercial real estate developer United American Realty.

Early in 2004, John Cox, CEO of the Sarasota-based general contractor Halfacre Construction Co., his son and president of Halfacre, Jack Cox, and E. Russell and Christine James disclosed plans to develop a large mixed-use project running from the former Hibbs Farm & Garden Supply store to the Blue Line Inc. parking lot. The proposal called for a 100-room hotel, 78,000 square feet of office space, 24,000 square feet of retail space and a 419-space parking garage.

Then in June the group scaled back its plans and dropped the hotel concept and inclusion of the Hibbs site.

In recent months, rumors spread that Corvus International LLC, which bought the Hibbs property, was looking to purchase the Salvation Army's adjacent site.

"We are just going to wait and see what happens there," John Cox says.

Walbolt re-elected chair

For the seventh consecutive year, the shareholders at Tampa's Carlton Fields PA have elected Sylvia Walbolt as chair of the firm's board of directors. She heads its appellate practice and trial support group.

Corrections

In the March 25-31 issue, a real estate brief should have reported that Tampa developers Les Aron, Steven Zaritsky and Mark Miller purchased about 4 acres from the William Moss Trust in two parcels for a total purchase price of $1.875 million. The $577,885 reported in the brief was only for a 1.83-acre parcel.

In addition, Robert Meade's title was incorrectly reported in the same edition. Meade is chief executive officer of Doctors Hospital of Sarasota.

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