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Roundup 12-22-2016

December 21, 2016

Note: It being the holidays, we are posting a day early and in slightly abbreviated form.

Contents

Transportation – What of TBX

Economic Development – Milken List Reprised

— The Surprising Return of Supercilious Pomposity

Economic Development – How Much is that Worth?

Downtown – What Citi Paid

Downtown/Ybor City – Not Now

Transportation – More Nibbling

— The Editorial

Channel District – Hotels

Plant City – Urban Village

Port – A Little Expansion

Rays – Um, No

Economic Development – Something to Think About

___________________________________________________________

Transportation – What of TBX

In the wake of FDOT’s TBX backtracking last week, where it said that it wants to make TBX something that people actually want and will be proud of, we got this:

Lawmakers are doubling down on promises from the state to pause plans for Tampa Bay Express. But those same lawmakers have not made any moves to pull funding for the controversial toll road project.

The Hillsborough legislative delegation was poised to spend much of its meeting Friday discussing TBX, but that changed after Florida Department of Transportation Secretary Jim Boxold told a Senate panel earlier this week that he wants to “hit the reset button” on the project.

Boxold was scheduled to make an 11 a.m. presentation during the delegation meeting, but that was cut from the final agenda. The chairman of the delegation, state Sen. Tom Lee, R-Brandon, said the decision was made to save time during the six-hour meeting.

* * *

Lee reiterated Boxold’s desire to re-evaluate TBX during Friday’s delegation meeting, calling the secretary’s comments “quite unusual” and a “significant admission” that the $6 billion plan to add express toll lanes to Tampa Bay’s interstates needs to be revised.

“Look at the 30-year history of the department and find cases where this kind of a significant about-face or pause has been done by the department,” Lee said after the meeting. “It doesn’t happen very often, and it’s emblematic of a department that recognizes that they need to do a better job of positioning this project.”

However, Lee said there has been no discussion to pull the project from the department’s work program, which means the state will continue to fund early stages of the plan, such as land acquisition.

Which brings us back to last week’s comments – how can you approve of something if you do not know what it is?  It really seems like, aside from the Howard Frankland bridge issue (and maybe including it), all the talk is all for show – to be seen to seem to do something while actually doing almost nothing at all (like what the County Commission did in the wake of the Go Hillsborough silliness). Following local custom, it does not sound like anything is really under reconsideration except to maybe do this:

State officials realize improvements must be made when it comes to the capacity of the bridge and interactions with the community, Lee said.

“I know they recognize that they have an aging, dysfunctional facility in the Howard Frankland Bridge,” Lee said. “My guess is, based upon conversations we’ve had, when that project is finally built, it will have more lanes than we expect it to have today.”

Which is fine as far as it goes, but does not fix any of the other problems with TBX – like the excessive size, destructive design, excessive cost, lack of real transit, lack of real congestion relief, and, in truth, lack of real connectivity for the average driver.  Our guess is that nothing will really change but the bridge because 1) FDOT is still committed to focusing on roads with express lanes and does not really care about our urban core, 2) most local officials don’t really care about our urban core aside from so photo-ops (see previous support by them for TBX), and 3) as shown in the mess with the Howard Frankland, most local officials did not even care enough about transportation to read the TBX plan in the first place (or they did read but just did not care about the obvious problems) and, aside from trying to avoid embarrassment, there is little reason for that to change.

Even though it is now clear that TBX is not a take it or leave it plan and can be changed for the better, there is no reason to think most local officials are going to want to get engaged to make it better and fix the deficiencies.  Maybe they will surprise us.  We hope they do, but we are less than optimistic.

Economic Development – Milken List Reprised

Last week we discussed the annual Milken Institute list and how it showed we are making progress but have a long way to go.  A Times columnist had a (sort of) different take:

Here’s a feel-good column to unwrap this holiday season that will reveal the Tampa Bay metro area is rebounding as one of the better performing, larger metro areas in the United States.

That’s great news after a decade of rough times in the bay area economy, hitting a low ranking among the nation’s top 200 metros at No. 169 in 2009. That’s when the recession cut deepest in Tampa Bay and Florida, and the housing market bust was most intense.

So here’s the best gift, courtesy of the Milken Institute’s just released 2016 annual survey of the best performers among the country’s 200 largest metro areas.

Tampa Bay ranks No. 33, up 25 spots from No. 58 in 2015 and up a whopping 136 metro spots from seven years ago when this market pretty much hit bottom at No. 169.

That bears repeating. The Tampa-St. Petersburg-Clearwater metro area leapfrogged 25 (from 58 to 33) metro areas in one year and 136 of the nation’s 200 top metro areas since a low in 2009.

Looks like all the talk of “swagger” by Tampa Mayor Bob Buckhorn isn’t just political hype after all.

Setting aside the swagger reference for a moment, it is good to not be 169th, but we do not think being 33rd is really a cause for celebration – more acknowledging you are making progress and moving forward.

Being 33rd is even less cause for celebration when you note that we are only the sixth best in Florida:

Let me suggest another factor in Orlando’s success not captured in the Milken survey. That metro area’s economic development organizations are regionally streamlined to speak with one voice. They are also efficient and communicate to each other so they rarely duplicate efforts or compete against one another. Tampa Bay, by contrast, still struggles to operate as a single market, though there are signs of improving cooperation.

Or it could be, as a Times chart in the same column (reproduced below) points out, something else:

Best performing metros in Florida
Metro 2016 rank last year Why
Orlando 9 28 High job growth, emerging tech
Fort Myers 15 40 High job growth
Naples 17 15 High job, wage growth
Sarasota 26 44 High job growth
Fort Lauderdale 28 41 High job growth
Tampa-St. Petersburg-Clearwater 33 58 High job growth
Jacksonville 39 82 High job growth

See here.

Note Orlando doesn’t just have jobs – it has emerging tech. (And remember that most of the usual suspects are ahead of us on the list). We are not against a more unified economic development approach, but the emerging tech may be important (and not listed for this area).

Like we said, it is good to get out of the basement, but we have a lot of work to do, especially when you consider our low wages, low GMP, and relative lack of influence.

— The Surprising Return of Supercilious Pomposity

Now, back to swagger.  We thought (hoped) that this area had already outgrown the swagger thing, but maybe not.  So we’ll just point out, once again, that swagger (“to conduct oneself in an arrogant or superciliously pompous manner” ) is always hype and very often actually a sign of insecurity.  Confidence (“a feeling or consciousness of one’s powers or of reliance on one’s circumstances” ) is different.  Swagger is for those who have not achieved. Just watch Warren Buffett, Steve Jobs (videos), Bill Gates, the heads of Alphabet or even the Lightning owner – they have lots of confidence but a distinct lack of swagger.

To say it more succinctly: Achievements (and the resulting confidence) are what really get respect.

Economic Development – How Much is that Worth?

A few weeks ago we discussed an economic impact study from the Port that included direct impact, as well as indirect, induced, and other impact.  As we noted then, other than direct impact, the rest is just speculation.  This week, there was a Times article about the economic impact of the upcoming College Football Championship game in Tampa.

How much of an economic impact will the College Football Playoff National Championship game have on Tampa Bay?

Depending on whom you talk to, place it somewhere near $300 million on the high end down to… well, practically nothing.

David J. Berri, a sports economist and economics professor at Southern Utah University, scoffs at the promise of a huge economic generator on Jan. 9 when the big game comes to Raymond James Stadium.

“You have this big giant party for people and then it’s over,” he said. “It’s great that you can do it, but the idea that it creates economic growth is ridiculous… It typically does not have much of an impact at all.”

The article goes into a lot of numbers and factors such as these:

The problems with rosy impact estimates, sports economists says, are numerous:

“You swipe your credit card in Tampa, but it’s deposited in New York City,” said USF’s Porter.

Adds Victor Matheson, an economist at the College of Holy Cross in Worcester, Mass.: “The single biggest thing a person will spend money on is a hotel or airline ticket in addition to the game itself. None of those areas of spending typically stick in the Tampa Bay area.”

Which make the calculations (especially other than direct impact) probably exaggerated (though we are sure there is some impact).  However,

Even some of the harshest critics of economic impact stats, however, say bringing the national championship here can be worth the investment in other ways.

“It’s a fun event for the community… and some businesses will come out net ahead,” Matheson said. “If the taxpayer is not on the hook for too much… If you can have an event like this and come out even, it’s probably a good thing for the city.” 

That, and for a place like Tampa, such an event gives good exposure that, despite all the hype for previous events, we still need.  So we are fine with it.  We just don’t believe the hype about impact.

Downtown – What Citi Paid

Last week we discussed Citi’s decision to buy their office park rather than move downtown (if they ever seriously considered moving downtown).  In any event, now we know what they paid for their office park, including already build almost 700,000 building they alone occupy plus a lot of land to expand:

A Hillsborough County deed filed Thursday reveals a price tag of $116 million for the 672,500-square-foot Citibank Center office campus in Sabal Park.

The sales price breaks down to $172 per square foot.

When you consider the 21-story box planned for the lot across from City Hall which the City Council approved sale of last week is reported to cost $120 million, then you can understand why Citi made the choice it did for its back office operations – no matter how extensive.

Downtown/Ybor City – Not Now

It seems the attempt to move some land from the downtown CRA to the Ybor CRA is over.

An idea that provoked a tug-of-war between boosters for downtown and Ybor City has died a quiet death.

In late 2015, business leaders in Ybor City proposed that the city redraw some lines to transfer the oddly named Gas Worx property — 7.6 acres that’s ripe for redevelopment — out of the downtown community redevelopment area and into the CRA for Ybor City. The Gas Worx lies along the Lee Roy Selmon Expressway between Channelside Drive and the Nick Nuccio Parkway.

That way, Ybor boosters said, property tax revenues generated by new development on the Gas Worx could be steered toward improving the gateways to the historic district. Inside a CRA, taxes generated by new growth in rising property values are reserved for public projects intended to foster even more development.

City officials never calculated how much money was at issue, but it was likely in the thousands of dollars.

Downtown boosters objected, and for months the city wasn’t even sure the idea was legal. The concern was that moving the Gas Worx from one CRA to another would force the city to reset the base value for the downtown CRA. The current base value was set in 1983, when the total value of property inside the downtown CRA was worth a lot less than it is today. Changing the boundaries, they worried, might jeopardize millions of dollars a year in revenue generated for downtown projects by growth there.

This move was always likely to turn into a bit of a fiasco.  But, in any event:

Finally, in November, the city’s legal staff said they couldn’t find a definitive case on the issue, but the consensus was that the risk of the worst-case scenario was low.

With that, the City Council was ready to move ahead with the transfer.

Then the new owner of the Gas Worx weighed in.

This month, Darryl Shaw sent the city a letter saying he had thought it over and concluded it’s in everyone’s best interest not to start redrawing CRA lines. Shaw, the CEO of the BluePearl Veterinary chain of animal clinics, paid $10 million for the Gas Worx property in June.

Shaw hasn’t said what he plans to build there, but his request was good enough for Ybor City business leader Joe Capitano Sr., who initially said the proposed transfer wouldn’t hurt downtown as much as it would help Ybor.

“I totally agree to sponsor whatever the owner wants,” he said in an email to the city.

With that, the City Council dropped the idea.

The whole thing is funny to us.   If the whole idea is that the land is in a specific area and the money (which will be paid anyway) is to improve a specific area as a matter of overall policy, it is not really clear why the owner’s preference should be determinative.  They should just deal with the public policy. On the other hand, while clearly well-intentioned, we thought the switch is the kind of thing that risks creating resentment and complications later and was of questionable utility.

It is good that it was dropped. (Maybe downtown and Ybor boosters can work together to fix up the transitional area between them with the money.)

Transportation – More Nibbling

HART, which is perennially underfunded and also locked in a roadcentric vision, continues to nibble around the edges of our transit issues:

The Hillsborough Area Regional Transit authority is starting to identify policy priorities ahead of the 2017 legislative session. Staff members have identified four policies that will continue the agency’s outside-the-box services supplementing traditional bus service.

HART is looking for funding opportunities for a business class service to Tampa International Airport from both downtown St. Pete and Tampa. The AirPorter service would cater toward the business community by creating a more luxurious way to get to and from the airport on public transportation.

That is not to say that it is inherently a bad idea to have good service between downtown and the airport – it isn’t, though maybe HART should not worry so much about “luxury” service for a very small slice of the population (really, “luxury” – don’t you think those people worried about “luxury” will get a car to their door?) and focus on proper service that most people would find pleasant, useful and affordable.  Maybe, being a public transit agency, they should look to make transit useful for the broadest segment of the public possible (at least a broader segment of the population) rather than a few very narrow niches.  Just an idea.

— The Editorial

Speaking of transit, there was a Times editorial about our local transit agencies.

After several failed starts, Tampa Bay may be finally starting to get its act together on mass transit. The transit agencies on both sides of the bay are looking at more ways to cooperate — a step toward improving regional bus service, saving time and taxpayer money and laying a foundation for new regional transit. County leaders in Pinellas and Hillsborough are also considering how to sharpen the region’s focus and make the area more competitive for state and federal transit money. There is plenty of work to do and details to iron out, but the work behind the scenes is encouraging.

Maybe, or it could be the same old maneuvering.

Pinellas County Commissioner Janet Long, the incoming board chairman, got things rolling this fall with her ambitious proposal to consolidate the bay area’s key transportation agencies and her discussions with state and local officials on both sides of the bay. It is an overdue idea that is both practical and strategic, and key state lawmakers are interested in moving forward when the Legislature meets in the spring. Folding the separate transit agencies in the region under a sole umbrella, or consolidating some services, would bring a sharper focus to the region’s commuting needs and provide an opportunity to save money. By having the entire region agree on its transportation priorities, the bay area would speak with one voice for state and federal transportation dollars, becoming a more attractive candidate for a portion of the limited pot of public money.

Wait. Merging the agencies is not a new idea.  It was brought up and shot down by Hillsborough/Tampa/HART officials.  What has changed, if anything, is unclear.  Will HART and Hillsborough actually allow this to go forward now?  There is no telling. (Maybe the inability of either agency to have a successful referendum for funding has focused some minds.  Who knows?)

The two counties’ mass transit agencies, the Pinellas Suncoast Transit Authority and Hillsborough Area Regional Transit, are considering an agreement to collaborate on some operations, from human resources to technology. This is a good step toward maximizing resources in both counties and taking advantage of bulk buying and other efficiencies that come with a larger operation. Leaders at PSTA and HART will continue the talks through January with a goal of offering a collaborative framework to the Legislature in its coming session. HART is also crafting a proposal for new regional service called AirPorter that would connect riders in downtown Tampa, St. Petersburg and the Carillon area to Tampa International Airport.

Collaborating on the back office stuff is good (also an older idea). Though the “collaborative framework” could just as easily be seen as a half-measure to stave off moves to actually unify transit systems (which was basically the idea when floated during discussions about merging PSTA and HART a few years ago).  It is completely unclear.

There are more particulars to deal with, and Tampa Bay is still a long way from a robust regional transportation authority and one common plan for mass transit that includes light rail. But in a region that was divided by county lines and rivalries for far too long, the substantive conversations taking place now represent real progress and point to a productive new year.

This area is still divided by county lines and rivalries between and even within counties.  Nevertheless, we withhold judgment until we see if anything actually happens.

Channel District – Hotels

There was news of a hotel proposal for the Channel District.  It would not be the first proposal, but it would be the first hotel in that particular area.

Liberty Group is planning a nine-story hotel with seven-story parking garage at 1155 E. Kennedy Blvd., where Kennedy Boulevard intersects with North Meridian Avenue. Liberty Group is planning a nine-story hotel with seven-story parking garage at 1155 E. Kennedy Blvd., where Kennedy Boulevard intersects with North Meridian Avenue.

Liberty, which acquired the vacant .95-acre parcel in May for $3.25 million, is seeking a non-substantial change approval from the city of Tampa, as its proposed development is smaller than a site plan approved for that property in 2007.

Non-substantial changes are determined by city staff and not subject to public hearing or city council vote.

The new site plan, filed with the city on Monday, shows a 213-room Hampton Inn & Home 2 Suites by Hilton with 198 parking spaces. The ground floor of the hotel, at 14,899 square feet, will include a Starbucks coffee shop and lounge seating, according to the site plan.

From URBN Tampa Bay - click on picture for Facebook page

From URBN Tampa Bay – click on picture for Facebook page

From URBN Tampa Bay - click on picture for Facebook page

From URBN Tampa Bay – click on picture for Facebook page

First, from what we can see, we like the street retail.  We like the Starbucks on the corner interacting with the street, rather than just the lobby.  And a hotel in the area is good.  On the other hand, the design is not really exciting, but it is generically ok.  The parking is a little sloppy, but they need parking, and it is not fatally bad (and it is consistent with other bad parking designs in the Channel District).

Basically, it is filler, which is fine.  (We just hope that whatever they propose for Bayshore is a lot more interesting than their usual fare.)

Plant City – Urban Village

It is not often we write about Plant City, but the Business Journal had an interesting article recently.

Plant City officials are looking for developers to transform 15 acres of city-owned land into a mixed-use development serving as a transformative hub for specialty retail, residential and commercial uses.

The City sent requests for qualifications to 60 developers last week and expect to begin negotiating with companies in June. Depending on its response, construction would begin as early as the fall on the Midtown Redevelopment Project.

* * *

Ideas for Midtown redevelopment, which sits adjacent to the city’s historic downtown district, began before the economic crash in 2008. Progress on the project following the recovery was slow going as officials took their time meeting various environmental benchmarks to make the property shovel ready. That, according to Herr, allows private investors to save big on any proposed projects.

The city spent $4.5 million readying the land for development including street improvements to create better traffic flow and safer pedestrian and bicyclist access, a new park, sound buffering around the CSX rail lines and environmental remediation.

Here are a sample of the renderings in the article:

From the Business Journal - click on picture for article

From the Business Journal – click on picture for article

From the Business Journal - click on picture for article

From the Business Journal – click on picture for article

We are all for this idea.  It could make Plant City quite cool (and ready for rail from their nearby downtown station to Tampa).  And it shows that you do not have to be in the middle of a big city (and should not have to pay a premium) to have a walkable area.

However, given the history of Temple Terrace’s downtown project and that Plant City is still seeking developers, we will just wait to see what actually happens (though we hope they succeed and show the County Commission that it too could do decent planning if it jsut cared enough).

Port – A Little Expansion

There was a little more news from the port:

Port Tampa Bay Commissioners are expected to approve a nearly $14.5 million contract to a Miami construction company to build a new berth at the port’s Redwing site.

The port’s staff recommended approval of the contract with GLF Construction Corp. of Miami. It is scheduled to come up for a vote Tuesday at the Port Tampa Bay board monthly business meeting. The contract includes a five percent contingency for any unforeseen conditions.

* * *

GLF was the low bidder on the Berth 302 project at Port Redwing which includes a 1,000-foot-long steel bulkhead, dredging, a new access road to the dock and building a piling that will support a concrete slab for heavy lift cranes to operate upon.

The expansion at the Redwing site is a critical part of the overall port’s newly updated master plan – Vision 2030, said Edward Miyagishima, senior advisor to Port Tampa Bay’s President and CEO Paul Anderson. Port officials foresee the Redwing site becoming an “industrial cluster” of businesses focused on manufacturing and distribution. New opportunities related to methanol and ethanol production, fertilizers, steel manufacturing, offshore supply, and biomass production are projected. So far, in August 2016, Tampa Tank and Florida Structural Steel broke ground on an $18 million facility expansion there. Port officials are also seeking to address the growing size of global fleet vessels by widening and deepening the Big Bend Channel serving Port Redwing.

We are fine with all this, though when we talk manufacturing, we were talking more finished, complicated goods.  Nevertheless, if there is a chemicals (or composting) manufacturing side is part of an industrial cluster there, fine with us.  Still, to reach its true potential as an economic engine, the Port needs finished goods going out in containers.

Rays – Um, No

We are not sure exactly why, but last week the Times floated a trial balloon regarding a Rays stadium (and it is not the first time the Times has brought up this location) :

When considering stadium sites in Tampa Bay for the Rays, there is one important factor that cannot be overlooked:

The perfect site does not exist.

Downtown Tampa would be ideal, but adequate land and financing will be hard to come by. Downtown St. Petersburg has room and funding mechanisms, but a rotten track record with attendance. Other locations have their upsides, but most of them have more downsides.

So why is it important to point this out?

Because it adds a certain wild-card element to the chase. If one site does not stand clearly above the rest, then the final choice could hinge on the details involved.

And that brings us to Derby Lane, a site rarely listed among the favorites but increasingly appealing in some circles. It may eventually be Pinellas County’s best chance of keeping the Rays from packing up and crossing a bridge into Hillsborough County.

That doesn’t make Derby Lane a frontrunner today. Downtown Tampa remains the favored choice for the Rays, even if the team’s options have been limited by Jeff Vinik’s expanding empire.

But if the cost is too high in Tampa, Derby Lane could be an intriguing fallback because of its proximity to Hillsborough. Which is the same reason that a Gandy Boulevard site was once the leading contender, when the Pinellas Sports Authority was shopping for stadium land in the early 1980s.

Back then, local officials were looking across the street from Derby Lane, where the Brighton Bay apartment complexes were eventually built. Today, Derby Lane’s 130 acres could be in play because of the declining appeal of greyhound racing.

While not perfect, there are some sites in Tampa that are pretty good.  But setting that aside, Derby Lane was bad idea when the Times first brought it up in 2015 and nothing has changed since then.  It still has limited access (one raod and no real transit or possibility of it) and is not convenient to most of Hillsborough unless you think all of Hillsborough is south Tampa (which a number of the Times columnists seem to) – and even then the Gandy would back up.  Any site with access involving only one (and a not particularly wide one, either) road is not an acceptable site.  Just drop it.

Economic Development – Something to Think About

We have gotten a lot of numbers about improving employment in our area, and it is better.  But here is something to think about:

The conventional full-time job is disappearing.

Survey research conducted by economists Lawrence Katz of Harvard University and Alan Krueger at Princeton University shows that from 2005 to 2015, the proportion of Americans workers engaged in what they refer to as “alternative work” jumped from 10.7% to 15.8%. Alternative work is characterized by being temporary or unsteady—such as work as an independent contractor or through a temporary help agency.

“We find that 94% of net job growth in the past decade was in the alternative work category,” said Krueger. “And over 60% was due to the [the rise] of independent contractors, freelancers and contract company workers.” In other words, nearly all of the 10 million jobs created between 2005 and 2015 were not traditional nine-to-five employment.

There are so many issues there that we are not going to try to parse the whole thing.  We just leave it to you to contemplate, especially when you contemplate this:

Tampa Bay’s rising (home) prices, though, may be scaring away one critical group of buyers — millennials. A new study found that buyers under 35 are eying cities in the American heartland like Minneapolis and St. Louis where prices are more affordable.

Florida and California had the least popular cities for that new generation of homeowners, according to Ellie Mae, a software company that processes almost a quarter of all U.S. mortgage applications. Just 30 percent of millennials preferred the Tampa Bay area compared to 44 percent who saw Minneapolis as a potential home

“As housing prices continue to rebound, millennials are increasingly representing a higher percentage of homeowners in the middle of the country, where they can get more home for their money,” said Joe Tyrrell, an executive vice president at Ellie Mae.

Like other buyers in the Tampa Bay area, millennials also face a limited selection of homes to choose from. In November, Pasco and Hillsborough both had less than a three-month inventory while Pinellas was right at the three-month mark.

At the nexus of low wages, job insecurity, and rapidly increasing housing costs, is a conundrum for economic development officials seeking to lure Millennial talent to push our economy to the next level.

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