Developer Michael Rechter kicked off his Monday morning staff meeting with a startling order.
“Everyone that’s been working on American Icon Brewery, stop what you’re doing.”
With that, Rechter kicked the keg out from under plans for 14th Avenue’s Compass Rehab building, and turned his focus to the newly available old Diesel plant, his first choice when he began scouting brewery locations two years ago.
“If we’re able to secure the building, we’re ready to move forward strongly,” he said emphatically.
Rechter got an informal tour of the plant’s bare-bones interior eight years ago from a subcontractor doing work there. “There’s something really great about that place. I’ve seen it with my own eyes.”
He was on the verge of placing a huge beer-making equipment order for the Compass building last month but checked in with City Manager Jim O’Connor first.
O’Connor initially was pessimistic about the Diesel plant being available any time soon.
Tied up for two years in litigation, with unsuccessful mediation in June and a September trial postponed, the brick behemoth appeared headed for its centennial next year still without a reason for being.
Then after a push from O’Connor to at least get the plant back under city control, attorneys agreed to a stipulation to get it out of the hands of developers David Croom, Charles Croom and Phil Barth, who were given a lease on the building back in 2001.
Now it’s up to the City Council to decide which proposal to purchase the plant is best for the city. O’Connor has made it clear he wants to sell; there are at least five offers on file, and more may come in.
Rechter, who redeveloped the Vero Bowl and Majestic Theatre plaza and is working on Indian River Plaza next door, says the Diesel plant bid he and Three Aves developer Scott Parker placed in May 2014 is the highest at $650,000; the appraised value of the plant is $500,000.
He also strongly believes a craft brewery is the best possible use for the building.
“It’s happening across the nation in areas that are being gentrified, where they’re trying to bring in the live-work-play dynamic,” says Rechter. “If you want to make Vero’s downtown a special place, you’ve got to create places where people want to come again and again.”
With the Cultural Council proposing an arts-themed overlay district in the old Downtown, the brewery concept “all ties in together,” Rechter says.
“The city would be hard-pressed to find a better group in terms of development experience,” says Rechter, a Fort Lauderdale chiropractor by training who with another chiropractor as partner opened pain clinics in several states and a mobile MRI leasing business in Kentucky, while investing in real estate development.
Rechter says he wants to get started “as soon as possible.” Another sizeable brewery, Walking Tree, is in progress near the airport, and Sailfish brewery in downtown Fort Pierce has settled on a building there for its expansion.
At one point Sailfish co-owner Nick Bischoff, a Vero resident, had eyed the diesel plant himself and was close to joining family friend Rechter in the Compass brewery project. When that hit a snag in July, Rechter decided to proceed on his own, signing on a brew master from one of Florida’s top breweries.
“I don’t need any financing, just a building to put it in. And I have a building on 14th Avenue. In order for me not to move forward on 14th Avenue, I would need to know soon about the Diesel plant.”
Both the City and the Croom-Barth team contributed to extensive environmental cleanup, and while the exterior restoration made the 1926 structure presentable to passers-by, inside it still has a dirt floor and a huge diesel engine that once upon a time generated electricity.
Developers accuse the city of breach of contract, fraud and misrepresentation in agreements to rehab the building; the City claimed developers owed $70,000 in back rent, and that was two years ago. The lease called for $19,000 a year rent once the building was ready for a tenant. But a tenant was never found.
The rent stops accruing when the tenants vacate, O’Connor says.
For years, O’Connor has stressed that he believes the city should sell the plant outright and get out of the business of “being a landlord.” He expects to begin the process of putting written proposals before the City Council as soon as the tenants vacate the property, which should happen this month. The stipulation gave them 14 days.
In October 2013, Guy and Lisa D’Amico wrote the city offering $595,000 for the structure with the hopes of building a craft distillery, including a retail store, restaurant and bar. The Coral Springs couple were building a home on the north barrier island.
Eight months later, in April 2014, the Cultural Council proposed turning the plant into an arts center with 30 studios that could be leased to artists willing to let the public watch them work. That idea garnered 2,000 signatures of support, but fell apart when no one stepped up to cover its $4 million price tag.
The nearby train tracks were also a concern with All-Aboard Florida train service looming.
Another proposal was made by Joel Tallant, who says he invested in a feasibility study to open a banquet facility and restaurant to be called Phoenix Fine Dining. Tallant says he studied food and beverage management and worked as a chef in a Hilton hotel in Annapolis, MD.
And then there is George Shinn, the controversial former owner of the Charlotte Hornets and a newcomer to Vero who recently bought the Lemon Tree diner on Ocean Drive. Shinn has proposed storing his classic car collection at the diesel plant and operating it as a car museum. He says he expects the city to partner in the venture, which he would run as a non-profit.
Rechter counters that a car museum will do little for the downtown. He offers what he calls a “perfect example” for his argument: A car museum privately built in 1999 in Fort Lauderdale’s Poinciana Park neighborhood did nothing to pull the area out of decades-old slump because people only visit a car museum “once in a blue moon,” Rechter says.
Then three years ago a stylish gastropub, Tap 42, opened blocks away. Hugely successful, it is widely cited for prompting other new businesses to follow. Property values have doubled and even tripled, the bar’s owner told the Sun-Sentinel.
“It created the vibe,” says Rechter. “Having dining and entertainment options in an area brings people in again and again.”
In addition, he says, a brewery could employ 75 people as opposed to the handful needed to run a car museum. Furthermore, as a for-profit venture with $3 million to $4 million in annual sales, the brewery would generate both real estate and sales tax revenues. A non-profit museum “is just not the right thing as a business decision,” says Rechter.
Like his competitor for the Diesel plant, George Shinn, Rechter has seen his share of controversy. In 2010, the doctor at one of Rechter’s Broward County pain clinics had his license suspended for prescribing more than 100,000 pain pills to less than two dozen patients over a span of four years.
Rechter’s Florida clinics have since been sold or closed.
As for O’Connor’s view of the upcoming process of choosing a buyer for the Diesel plant, he says, “Nothing is ever easy with the City of Vero Beach.”