Unlike Vero Beach officials, longtime island resident Don Urgo wasn’t at all surprised the city received only two responses to its second attempt at finding a suitable developer for its much-anticipated Three Corners project.
He headed one of the four development partnerships that submitted plans last year, when the city sent out its first Request For Proposals.
That means Urgo had a front-row seat for the initial proceedings, which an alarmingly wrongheaded and obviously overmatched City Council majority turned into the disappointing and embarrassing clown show local skeptics had predicted.
The council members’ amateurish antics not only unnecessarily derailed the selection process and raised questions about the competence of the city’s leadership, but they also left a lasting impression on the commercial real-estate development industry.
Certainly, they gave Urgo pause – enough, ultimately, to convince him to finally abandon his years-long interest in creating the dining, retail, social and recreational hub on the city’s mainland waterfront.
“To say I was frustrated with how it played out is probably an understatement,” Urgo told Vero Beach 32963 last week in a phone interview from a vacation home on the Chesapeake Bay in Maryland, where he was spending the holidays. “I was disappointed and discouraged, too.
“We had invested a tremendous amount of time, effort and money in putting together our proposal,” he continued. “And that doesn’t include the loss of other opportunities – projects we could’ve pursued but didn’t, because I live here and I thought this project was important to the community.
“Even so,” he added, “I thought we might take another shot at it when the new RFP was issued.”
Urgo, who has been developing and operating hotels worldwide for more than 50 years, had gone so far as to assemble his team to discuss revamping his earlier proposal, based on the feedback he received from the city’s Selection Committee and City Council members.
The more he talked about it, however, the more he was convinced this project wasn’t worth the effort or the risk – not for him, anyway, and not at this point in his life.
“I just got bad vibes,” Urgo said. “We looked at what happened last time and the challenges we’d need to overcome. And after talking about it with my family and partners, I came to the conclusion to not go through it again.
“It was like the old Kenny Rogers song: You’ve got to when to hold ’em, know when to fold ’em, know when to walk away,” he added. “Well, it wasn’t easy to walk away, but I lost confidence in the project and didn’t want to waste my time and money, or other people’s time and money.
“I’m 87 years old, and as much as I wanted to do it, I didn’t need this project.”
So he’ll watch from the sidelines as two of his former Three Corners competitors – Indiana-based Clearpath Services and a Florida-based partnership that again includes the SuDa group and Madison Marquette – try to sell their updated proposals to the city.
Urgo, though, doesn’t believe SuDa should have been given a second chance after council members disqualified the group in June for violating the terms of the RFP’s bidding process.
Days after council members ignored the overwhelming recommendation of its Selection Committee and chose SuDa to develop the 17-acre parcel that contains the city’s shuttered power plant, they discovered the group’s lead representative had attempted to directly contact them only hours before they made their May 28 decision.
The city’s RFP strictly prohibited such contact.
But after disqualifying SuDa – and amid arrogant threats of legal action by the group’s attorney – the council threw a tantrum and voted to reject all four proposals, rather than proceed under the process as defined by the RFP.
That decision still sticks in Urgo’s craw, and for good reason: Under the RFP, the council should have moved on to its second choice, which was Clearpath, which submitted a wow-factor $500 million proposal he believes would not have survived the negotiation phase of the process.
“Clearpath put together a magnificent proposal, but there was no way in hell that plan was going to be developed as presented,” said Urgo, who has lived in Vero since 2005 and, along with his wife, Carolyn, owns homes in John’s Island and Marbrisa.
“They called it aspirational,” he added. “To me, it was totally unrealistic.”
If so, the RFP would have allowed the council to move on to its No. 3 choice: The Urgo-led Vista Blue Vero Beach Resort and Spa group, which submitted a $172 million proposal that would repurpose the power plant as a three-level, multi-purpose entertainment, exhibition and hospitality venue.
His plan, which had solid financial backing, also included a 225-room, four-star resort hotel that was to operate under the Marriott banner, as well as three free-standing restaurants, numerous shops and a robust marina with slips for permanent mooring, day-use visitors and mega-yachts up to 150 feet long.
There would also have been lots of open space.
“They made the wrong decision,” Urgo said of the council’s vote to abandon its first RFP and start over with a new one. “After SuDa was disqualified, Clearpath should’ve moved up to No. 1, and we’d be No. 2.
“I’m convinced the Clearpath proposal would never go forward, so then they’d go to us,” he added. “That’s what should’ve happened. Instead, they punished us for no reason and rewarded SuDa, which didn’t follow the rules.
“It all came to a chaotic end.”
Now, the city is trying again, relying on a more-demanding RFP that provides a more streamlined process and a Selection Committee reduced to only five members. And there are only two contenders.
The latest proposals submitted by Clearpath and the former SuDa Group – with Madison Marquette taking the lead – won’t become public until next Thursday.
Urgo expects the Clearpath plan to have been scaled back and for Madison Marquette to provide a formidable challenge. But he still wonders about the financial feasibility of the project, given the limitations the city’s RFP has placed on developers.
For example: No residential construction is permitted; the city’s 50-foot height restriction may be exceeded only for a re-purposed power plant, where the roof is 60 feet high; and the environmental costs of developing the property could be exorbitant.
“There are a lot of unknowns, so it’s hard to speculate what we’ll eventually see there,” Urgo said.
“I think you’ll see something developed there, but will it be what the city envisions? I don’t know.
“The time and money you need to invest, the return on your investment, how long you’re willing to wait to see that return … All of that is going to impact what we see there,” he added. “And then there’s the history of what happened last time.”
Yet he understands why city officials were surprised and disappointed when only two development groups responded to the new RFP.
“A project of this magnitude in a place like Vero Beach should’ve been attractive to a lot of developers, even on the international market,” Urgo said. “Developers are always looking for waterfront property like that.
“So you’ve got to ask: Why didn’t they jump at the chance?”
Unless, of course, we already know the answer.
