With Indian River Shores nearly built out and land near the beach at a premium in a booming island housing market, the Town Council sees an opportunity to put a prime 5.5-acre undeveloped tract east of A1A at the southern end of town up for sale.
The roughly rectangular parcel, which includes 300 feet of frontage at 5110 A1A between Pebble Bay Villas and Surf Lane, was appraised last month at $7.7 million, provided the property is re-designated by the Town to allow medium-density residential construction, which the appraiser noted is compatible with the surrounding area. That would mean condominiums or townhouses, most likely.
Though the council voted to go forward with the appraisal in January, Town Manager Robbie Stabe said, “Council has not voted on how the proceeds would be used.”
If the property is sold, the cash infusion could be used to bolster reserves or to pay down the Town’s unfunded pension or other post-employment benefit liabilities, or a combination of both. A portion of the proceeds could be used to fund the Shores’ ongoing battle with Vero electric.
Theoretically the windfall could also be used to reduce property taxes for a year or a number of years, should the Town Council choose that route. Each year, the Town raises about $4 million in property taxes from its tax rate of $1.67 per $1,000 in taxable value, roughly 90 percent of that going to fund public safety services.
“The most likely purchaser of the subject land would be a land speculator, residential land developer, or a local/regional home builder,” the appraisal states. The land was acquired in the mid-1970s as part of a land-swap deal for some land west of A1A. Indian River County retains first right of refusal on the property, and also owns the actual oceanfront in front of the parcel, which has a 300-foot frontage abutting the dune and the county-managed beach.
Neither County Administrator Joe Baird, nor Commissioner Wesley Davis, who attended last week’s Shores council meeting, indicated the County wants to purchase the Town’s acreage at this time. Baird did say he would work with staff to create some sort of license agreement permitting the purchaser of the parcel to have beach access, either by a beach path or some sort of dune crossover, which would add to the value of the property.
Once sold and on the tax rolls, though, the County and the School Board, as well as the Town, would enjoy new tax revenue from the property, with tax revenue increasing further as homes are built there. An R1-A residential zoning with low-density or LD land use designation would provide for a maximum of three units per acre, Stabe said; R2-A residential zoning with medium-density or MD land-use designation would allow up to six units per acre, meaning as many as 20-30 units could be built on the property, creating millions of dollars’ worth of additional real estate value.
Because the parcel is owned by a government entity, the current future land-use designation is open-space recreation or OSR, but the property is still zoned residential.
The parcel is reportedly “cleared of most large trees,” but is overgrown with native grasses and invasive Brazilian peppers, which are prevalent all over the barrier island where not kept in check. There are no structures on the property now, but it is occasionally used as a training field for the Shores Public Safety Department, as it was most recently for extrication training, where smashed-up vehicles were brought in and officers practiced rescuing victims.
As for next steps, Stabe said the Town’s Finance Committee will get a crack at analyzing the appraisal and its fiscal possibilities for Town residents.
“It is my intention to work closely with Bob Auwaerter (Finance Committee chairman) to develop some options to present to the Council,” Stabe said, adding that there are two steps that need to happen before the parcel is put up for sale. “Part of the property was never annexed into the Town and we would need to do that first. Then the rezoning to . . . either LD or MD.”
Once all of the annexation and updated zoning work is completed, and the land use is incorporated into the Town’s comprehensive plan to ensure the buyer has no issues down the road when he or she tries to develop the property, the Shores can find someone to market the land. Appraisers estimated it might take a year to find the right buyer.
“The Town is not required to put the property up for bid through an RFP process. What we will do is conduct an RFP to select a real estate broker who is familiar with large parcels like this, has a good track record, has the marketing experience needed, and who will offer the best deal,” Stabe said.
