Downtown Daytona project gets first 2 approvals

City commissioners unanimously approved zoning and comprehensive plan changes that allow up to 300 new luxury apartments, shops, a grocery store, restaurants and parking garage on the block just east of Ridgewood Avenue that’s been occupied by First Baptist Church since 1898.

DAYTONA BEACH — A key block in the city’s historic downtown core took a leap toward the future Wednesday night.

City commissioners unanimously approved zoning and comprehensive plan changes that allow up to 300 new luxury apartments, shops, a grocery store, restaurants and parking garage on the block just east of Ridgewood Avenue that’s been occupied by First Baptist Church since 1898. The church is building a new campus on Tomoka Farms Road and is relocating this fall.

“I think it’ll have a large impact downtown and bring people back downtown again,” City Commissioner Ruth Trager said after Wednesday’s meeting. “It’s a lovely part of the city with Riverfront Park. The idea of a grocery store there to me is very exciting. I can see nothing but positivity.”

The vote was the first of two decisions needed from city commissioners to solidify the changes. Final votes on amending the property’s comprehensive plan and switching the zoning from downtown redevelopment to planned development are slated to be taken at commissioners’ June 19 meeting. A yes vote on the comprehensive plan changes would allow more of the property to be designated for high-intensity uses and increase the density from 40 dwelling units per acre to 150 housing units per acre.

Consolidated-Tomoka Land Co. has bought out most of the block dominated by First Baptist’s buildings. The block, which until recently was also home to First Methodist Church, is bordered by Ridgewood Avenue, International Speedway Boulevard, Palmetto Avenue and Bay Street.

Demolition of the three First Baptist buildings remaining on the property could start in October and construction will begin next year.

Designs are being finalized, but for now the conceptual plan puts a five-story apartment building on the corner of Bay Street and Palmetto Avenue. The multi-story parking garage, which could have at least 400 parking spaces, would stand at Ridgewood and Bay. The design shows the garage and apartment building connected by a covered pedestrian overpass and street-level retail shops in both buildings.

Renderings show the grocery store and its parking lot on the corner of ISB and Palmetto, a standalone building in the middle of the property that could be either a restaurant or shop, and a restaurant fronting Ridgewood between the existing Popeye’s fast-food eatery and Beck’s office building.

If city commissioners approve the land use changes, the city and Consolidated-Tomoka officials will sign off on a planned district agreement that would require the first round of applications for construction permits to be submitted within five years. Construction would have to be substantially complete within eight years. Any additional phases would have to be complete within 20 years.

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Brown & Brown project making a ‘colossal difference’

The insurance giant’s $40M HQ plan already making an impact by creating jobs, attracting other developers

DAYTONA BEACH — Brown & Brown’s planned 11-story headquarters complex on North Beach Street, which recently began construction, is being hailed by community leaders for ushering in a much-needed renaissance of this city’s struggling downtown.

Daytona Beach Mayor Derrick Henry described the $40 million project as one that is already making a “colossal difference” for the city because of its promise of bringing hundreds of high-paying jobs and by “creating energy and vibrance in the downtown area.”

Brown & Brown CEO J. Powell Brown said his company is “excited that this building will be part of the redevelopment of downtown.”

Noting the fact that the insurance brokerage that has grown to be the sixth-largest in the country, was founded in 1939 just a few blocks away by his grandfather and uncle, Brown told the gathering, “We’ve always been and always will be committed to this community.”

John Albright, the CEO of Consolidated-Tomoka, was one of the more than 300 people who turned out for Brown & Brown’s invitation-only flag-raising event.

“This kind of commitment and investment will do wonders for downtown,” Albright said of Brown & Brown’s project.

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Proposed “Project Delta” Could Transform Downtown Daytona Beach

DAYTONA BEACH, Fla. — Big changes could soon be on the way in Downtown Daytona Beach because of “Project Delta.”

Project Delta is the brain child of Consolidated-Tomoka Land Co., which owns a nearly 6-acre lot at the intersection of Palmetto Avenue and International Speedway Boulevard.

The company wants to fill that land with a 300-unit apartment complex, a grocery store, shops, and parking.

“We kind of sat down with city management and staff and said, ‘What is needed in downtown Daytona?’ The first thing they said was residents, and second was a grocery store,” said Scott Bullock, the Vice President of Real Estate with Consolidated-Tomoka.

In order for that project to become a reality, the land first has to be rezoned. Right now, a church that plans to move at the end of the year takes up the majority of that property.

In a beginning step, the law firm Cobb Cole presented the plans to the Downtown Development Board on Tuesday. If built, the project could generate money for the area, especially in taxes, since the church is exempt from taxes.

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A vision and a challenge

The early architectural drawings are beautiful to the point where it’s hard to recognize them as Daytona Beach.

In the fight to clean up Daytona Beach’s troubled core beach area, and continue the progress on its riverfront downtown, we have often offered this advice: Look for modest but achievable ways to reclaim abandoned businesses, weed-filled parking lots and outward signs of decay. Then hope, and expect, that grander and more transformative projects will take root.

But Consolidated-Tomoka Land Co. isn’t waiting around for that incremental change. Earlier this month, officials with the Daytona-Beach based property investment firm proposed two major projects — one on beachside, the other on property adjacent to the Beach Street shopping district — that could accelerate the revitalization of communities that desperately need help.

Daytona Beach has seen developers weave castles in the air before, and watched them collapse and blow away just as readily. This is different because Consolidated-Tomoka is local. Executives with the company understand the challenges and opportunities in the Daytona Beach market far better than any out-of-town developer could. They’ve seen the blight around Main Street, the panhandlers and open drug use within blocks of the city’s beachfront and along Ridgewood Avenue. They know what they’re getting into.

And yet, they believe it can get better. The early architectural drawings are beautiful to the point where it’s hard to recognize them as Daytona Beach. Right now, they’re just ideas of what could happen — but the vision they present is a grand one.

The beachside project would be directly south of the Ocean Center complex, extending to Main Street. Plans include hundreds of upscale apartments or condominiums in a high-rise tower, with retail and strolling areas and a covered pedestrian overpass that would give residents safe access to the beach, hotels and dining on the east side of State Road A1A. A new garage would replace surface parking in the area.

The mainland project, code-named “Project Delta,” proposes 300 more luxury apartments and retail space, including a spot for a grocery store — something downtown has lacked for decades. The target area runs from Bay Street south to International Speedway Boulevard, and Ridgewood Avenue to Palmetto Avenue. Consolidated-Tomoka already owns much of that property, including the site the First Baptist Church will soon vacate. That proposal is a natural complement to other exciting developments in the area, including Brown & Brown’s headquarters that could bring 600 employees to downtown.

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Apartment boom in progress

The influx of newcomers to Volusia and Flagler counties is not only creating a need for more new homes.

It’s also creating increased demand for apartments.

And investors and developers have taken notice.

“Daytona Beach was one of the top rent growth markets in the country last year,” observes Michael Donaldson, senior vice president of investments for the commercial real estate brokerage Marcus & Millichap in Tampa.

The average rental rate for apartment units in Daytona Beach is just over $1,000 a month, a 5 percent increase compared to a year ago, according to Donaldson, who oversees his firm’s national multi-housing group.

The national average rental rate has increased 4 percent in the past year, he said.

The average occupancy rate for apartments locally has also risen to 96.4 percent, exceeding the state and national averages of 95.5 percent and 95.4 percent respectively, according to Donaldson.

“Developers are typically attracted to strong demographic trends and employment growth,” said Donaldson, noting the growth in apartment developments throughout Central Florida, especially in the bigger cities.

As the cost of building new apartment communities in Orlando and Tampa rises, “developers are migrating to secondary locations such as Daytona Beach as they can typically acquire land for much cheaper and there is less competition,” he said.

New commercial developments locally such as the One Daytona entertainment/retail/dining complex across from Daytona International Speedway and the Tanger Outlets and Tomoka Town Center malls next to the Interstate 95/LPGA Boulevard interchange are also spurring the increase in apartment projects here, according to McDonald.

Apartments under construction in Volusia County include the 276-unit Tomoka Pointe apartments rising up behind Tomoka Town Center in Daytona Beach, and in New Smyrna Beach, the 264-unit Messina by the Lake apartments in the Venetian Bay community.

Those projects are just the start of a surge in new apartment developments throughout Volusia and Flagler counties.

In Daytona Beach, multifamily housing projects in the works include developer Unicorp’s plans to build 340 apartment units as part of its Tomoka Village development just north of LPGA Boulevard, between Williamson and Clyde Morris boulevards, Indigo Development’s plans for the 301-unit East LPGA Apartments complex along LPGA Boulevard, east of Clyde Morris Boulevard, developer Next Chapter’s proposed 210-unit Dunn Avenue apartments on Halifax Health-owned land next to Volusia Mall, and Prime Group’s plans to build 276 apartment units on the east side of One Daytona.

In addition, Consolidated-Tomoka Land Co. recently acquired much of the downtown Daytona Beach block where the old First Baptist Church is located with plans for a mixed-use project that will include apartments.

The impetus for Consolidated-Tomoka’s project is national insurance giant Brown & Brown Inc.’s future headquarters campus two blocks away on North Beach Street.

The 11-story office building is expected to bring hundreds of white-collar professionals to downtown Daytona Beach when it opens in late 2020.

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Brown & Brown begins work on future Daytona HQ

DAYTONA BEACH — Just over a year after Brown & Brown Inc. announced plans to build a new headquarters on North Beach Street, site work has finally begun on the office tower.

“Everything is going according to game plan,” said Chairman J. Hyatt Brown in a phone interview.

And the headquarters now is going to be bigger than first envisioned.

New site plans filed with the city for the project now indicate the tower will be 11 stories, up from the originally proposed 10, and as much as 225,000 square feet in size.

“Call it 10 1/2 floors,” said David Lotz, chief corporate counsel for Brown & Brown. “We want some sort of rooftop amenity like a deck or outdoor space as well as some sort of inside space.”

The decision to add the extra floor was made to take full advantage of the spectacular views from the top of the building which the company verified through the use of an aerial drone.

“You’ll be able to see the river as well as the ocean,” Lotz said.

Brown in a phone interview acknowledged it took longer than expected to start construction because of delays in obtaining the necessary permits.

That process included a voluntary environmental cleanup of the former car dealership sites, which was deemed to be essentially completed by the Florida Department of Environmental Protection in a letter issued in July.

Lotz said the development site had some soil problems and is requiring extra fill dirt to be trucked in.

Plans for the corporate campus also call for the planting of more than 200 trees and extensive landscaping, as well as storm water retention ponds and other features designed to lessen the potential for flooding, not only of the company’s property, but also the surrounding area, Lotz confirmed.

The office tower will be built in the southeast section of the campus, with room for a potential second tower to be added immediately north of it.

The west portion of the campus will primarily be used for surface parking, which will be broken up with “islands” of landscaping and trees, Lotz said.

“We’re building a campus for our teammates. We don’t want a nice building and a vapid parking lot,” he said. “We want a nice campus for the city.”

The planned office tower is seen by local observers as a key to revitalizing the city’s historic downtown business district.

The new headquarters is expected to bring at least 625 white-collar workers to the area in addition to the more than 300 already employed at the national insurance agency’s current leased headquarters offices at 220 S. Ridgewood Ave.

The new jobs are expected to pay an average of at least $41,300 a year, well above the current average annual wage for workers in Volusia County.

Brown said the anticipated move-in date for the new headquarters will be Oct. 1, 2020.

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Consolidated’s land-selling spree continues

DAYTONA BEACH — Consolidated-Tomoka Land Co.’s days as one of Daytona Beach’s largest landowners are fast nearing an end.

The public company in its second quarter earnings report disclosed its local land holdings are now down to 5,500 acres as of June 30, from 8,100 on March 31.

Of its remaining land, 4,300 acres are under contract to be sold between now and 2020.

“This is an evolution of the company,” said CEO John Albright.

Historically, Consolidated-Tomoka generated most of its revenues from land sales as well as timber and hay production on the vast acreage it owned in Daytona Beach.

Most of its land holdings are in the area surrounding the Interstate 95/LPGA Boulevard interchange.

Consolidated-Tomoka owned approximately 11,000 acres locally when Albright became CEO in August 2011.

Its land sales since then include the sites of what is now the Trader Joe’s distribution center and Tanger Outlets mall on the east side of I-95 and the Latitude Margaritaville and Mosaic communities going up just west of I-95.

The company has reinvested most of the proceeds from those land sales to buy income-producing properties such as retail and office buildings leased to long-term tenants.

Those acquisitions have been largely in other parts of the country — with two notable exceptions.

Consolidated-Tomoka in January completed the construction of two oceanfront restaurants — Landshark Bar & Grill and Coquina 214 Restaurant & Bar — on six acres it acquired in 2016, north of SunSplash Park.

In the first quarter of this year, the company acquired three acres belonging to First Baptist Church in downtown Daytona Beach and in June added other neighboring parcels on the same block.

“We intend to pursue the potential redevelopment of these parcels, which are located nearly adjacent to the location of the future new headquarters of Brown & Brown Inc.,” Consolidated-Tomoka stated in its earnings release

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Brown & Brown HQ construction to begin soon in downtown Daytona Beach

Construction is slated to begin this fall on Brown & Brown’s new headquarters building on the riverfront in downtown Daytona Beach

DAYTONA BEACH — The empty 10-acre lot on North Beach Street covered in tall weeds, trash and piles of broken up concrete is about to undergo a metamorphosis.

In about two months, the rubble will be cleared away and the site will start to transform into the new headquarters of Brown & Brown Inc., a homegrown business that has become one of the world’s largest insurance brokers.

Utility work will extend through the fall, and foundation construction that will include pilings could begin by the end of the year. Then throughout 2019 a new 10-story building will take shape just south of the Main Street bridge.

“In the first half of 2019 you will see the shell of a building,” said David Lotz, Brown & Brown’s chief corporate counsel. “We’re excited to be where we are. From the outside it seems like it’s taking a long time, but we’ve moved along at a good clip.”

When the project was publicly announced 10 months ago at a gala event attended by dozens of local leaders, there was “no true design” for the building yet, Lotz said. Now Jacksonville architect RS&H has the towering structure’s design 95 percent complete and attention is turning to hiring a general contractor. An updated rendering will be provided later this year, he said.

The goal remains to open the 200,000-square-foot building that will overlook the Halifax River by the end of 2020. Around 650 to 700 employees will work there to start, and that number could swell in the future if the vision to one day add a second building on the property comes together. The north end of the site is planned as a parking lot but eventually could become the spot for a second building, Lotz said.

The company will continue to house another 350-plus employees at the 75,000-square-foot office tower it leases at 220 S. Ridgewood Ave. That will expand the insurance company’s local workforce to more than 1,000, some of whom will transfer from Brown & Brown offices in other states.

For many locals, and particularly Beach Street business owners, the new office tower is hoped to be a savior for the long-struggling downtown riverfront.

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Ripple effect of Hard Rock, Brown & Brown, Protogroup projects already being felt

Efforts to revitalize Daytona Beach’s blighted beachside and historic downtown are already getting a boost from a trio of high-profile developments, local observers say.

The new Hard Rock Hotel on A1A, which opened March 1, has already sparked interest in the area from other hotel developers.

So has Protogroup’s Daytona Beach Convention Hotel & Condominiums complex also going up along A1A, at the east end of Oakridge Boulevard.

Meanwhile insurance giant Brown & Brown Inc.’s planned 10-story headquarters on Beach Street has also resulted in the sale of two neighboring properties.

Since November, Tim Davis of SVN Alliance Commercial Real Estate Advisors said he has had five different developers from south and west Florida contact him to take them on tours of the area’s beachside.

“The first thing they want to see is the Hard Rock, where it’s at (progress-wise), its proximity to the Ocean Center (convention center) and what opportunities are available (for potential hotel and/or condominium projects),” Davis said.

Of the Hard Rock, Davis said, “They want to see it, walk through it and see the level of quality.”

The reason has nothing to do with whether they are rock music fans.

What’s got them intrigued, according to Davis, is the fact that the Hard Rock is an upscale, four-star-level resort in an area generally not known for high-end hotels, with a few exceptions.

The Hard Rock is on the site of the former Desert Inn, a rundown 1950s-era hotel described a few years ago by TripAdvisor as one of the nation’s dirtiest hotels.

Converting it into a Hard Rock was a $40 million gamble by local developer Summit Hospitality Management Group, whose managing partner Abbas Abdulhussein described in an interview last year as a “flight to quality.”

Abdulhussein explained his belief that given the option, there would be enough visitors and even locals willing to pay a little extra than the current average daily room rate for the Daytona Beach area to stay in a higher-end hotel like the Hard Rock.

So far, that appears to be the case, says Davis, who recently stopped by the Hard Rock with friends for a late night drink and was pleasantly surprised to see it bustling with guests.

“We were at the bar and I pulled up and there were no rooms available that night,” Davis said of the 200-room Hard Rock.

Also making a strong impression on the visiting developers that Davis took on tours of the area was Protogroup’s planned 501-room Daytona Beach Convention Hotel & Condominiums project.

The massive complex, upon completion, will include two towers, one 31 stories high, the other 28, both of which will be the tallest in Daytona Beach. With an estimated project cost of $192 million, it is also believed to be the most expensive hotel/condo project ever to be developed in Daytona Beach.

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Brown & Brown steps up hiring plans

DAYTONA BEACH — Brown & Brown’s planned 10-story downtown headquarters tower is slated to be completed by October 2020, but the insurance brokerage giant will likely fulfill its pledge to create at least 600 new jobs locally well before that date.

Chairman J. Hyatt Brown told a gathering of local business leaders and elected officials Wednesday night that his company plans to relocate profit centers here from the Detroit and Boston areas, which will create a total of 700 jobs.

The planned $30 million headquarters campus on North Beach Street, which is expected begin construction later this year, and the new jobs the company is bringing “will be a catalyst for the downtown area,” Brown told attendees of the Volusia County Association for Responsible Development’s annual dinner.

“All of what’s going to happen down there is going to happen explosively,” he said, adding that he knows of other developers who are considering projects that will create housing in downtown Daytona Beach that will boost business for Beach Street restaurants and shops and allow Brown & Brown employees opportunities to live within walking distance of the planned headquarters campus.

The company has pledged in its agreements with the state and Volusia County that the new jobs it will create locally between now and the end of 2022 would pay an average of at least $41,300 a year, well above the current average wage for workers in the county.

Brown told The News-Journal that his company intends to begin relocating those profit center operations here before the completion of the future headquarters campus. “We can’t afford to wait that long,” he said.

In order to accommodate those additional workers, Brown & Brown is already working to reconfigure its current five-story 75,000-square-foot headquarters building at 220 S. Ridgewood Ave. to increase its capacity to between 450 and 500 people, up from just over 300 currently.

The company also recently leased temporary office space in the Martin & Klayer building on the corner of Palmetto Avenue and West International Speedway Boulevard and also has a leased office space on Clyde Morris Boulevard.

Brown & Brown, which employed approximately 350 workers in Daytona Beach when it announced its plans for its future headquarters on Sept. 1, now employs approximately 400 people locally, including more than 20 new trainees, Brown said.

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