The Vero Beach City Council should seriously consider pausing the again-troubled, developer-selection process for the Three Corners project.
Given the realities exposed during the city-appointed Evaluation Committee’s initial meeting last week – along with all the construction-market unknowns spawned by the ongoing tumult in Washington – council members might need to discuss postponing the project indefinitely.
Such a decision would not be popular with many in the community, especially after the council fumbled the city’s first attempt at choosing a developer for the lagoon-front site last summer.
But it would be prudent. There are too many red flags warning us of potential danger ahead to feel good about what’s happening.
Let’s start with the bigger picture: If President Trump follows through with his promised tariffs and mass deportations, the costs of construction materials will soar and cheap labor will be difficult to find.
In addition, interest rates may well be headed up, which could make borrowing money more expensive in the coming months and, maybe, years.
Should this perfect storm materialize – and it’s not out of the realm of possibility – the city and its developer would be embarking on a $200-million-plus transformational and generational project at the wrong time.
Council members must consider those outside factors, even though the monetary investment would be made almost entirely by the developer.
They also need to heed the behind-closed-door warnings from some of the community’s most prominent business leaders, more than few of whom quietly question the financial feasibility of the Three Corners project as planned.
Can the Vero Beach community support a development of that magnitude – a dining, retail, hospitality, social and recreational hub on the mainland’s waterfront – on a year-round basis?
Will the Three Corners thrive beyond our busy season, after the snowbirds have gone north, the winter tourists have left Florida and the summer heat and humidity have moved in?
Is the local population large enough to sustain a fully developed Three Corners site, despite competition from Ocean Drive, downtown Vero and, potentially, a town-center-type dining, retail and recreational complex at the Indian River Mall?
Certainly, the chosen developer will need not only a huge infusion of equity, but it also must be able to endure a slow rate of return on its investment.
That brings us to last week’s Evaluation Committee meeting, where we learned that Clearpath Services – the Indiana-based development group that again submitted the most comprehensive and exhilarating proposal – had lost its financial partner and adviser.
According to sources familiar with the situation: Only two weeks before the March 4 committee meeting, Westminster Capital informed Clearpath founder and president Randy Lloyd that it was withdrawing from the partnership for the Three Corners project.
Still, the committee evaluating the two proposals submitted to the city in December overwhelmingly chose Clearpath.
That’s how much the committee members preferred Clearpath’s plan. That’s also how little they were impressed by the plan submitted by The Blue at Vero Beach group, which is a spinoff of the SuDa partnership that was selected by the council last year, only to be disqualified for violating the terms of the city’s Request For Proposals.
While SuDa Investments remains a partner, The Blue group is now fronted by Madison Marquette, a highly respected real-estate services firm based in Washington, D.C.
Committee members, however, were disappointed – even critical – of The Blue’s proposal, which they said was incomplete and lacking in detail.
“They did the minimum to submit it,” said committee member Rob Bolton, the city’s Water and Sewer Department director.
Jeb Bittner, a committee member who chairs the city’s Planning & Zoning Board, said it was “hard to compare” the proposals because Clearpath’s was fully fleshed out and The Blue’s submission was “almost skeletal.”
He and other members disparaged The Blue’s proposal for using what they called “clip art” – a type of digital picture used for illustration in graphic-design projects.
SuDa’s initial proposal last year provided the same lack of detail and refinement, but the city accepted the submission and allowed the group to play its way into the process after its pitch man, Gaurav Butani, promised to further develop its plan as the process progressed.
City officials did so because SuDa was a late entry into the competition, and getting four submissions instead of three gave the process more credibility.
The Blue had no such excuse this time: The city launched its second attempt to find a Three Corners developer in August, when it issued a new, more-demanding RFP.
The group had four months to revise and flesh out its previous proposal. To submit anything less than a fully developed plan that addressed every aspect of the RFP should be unacceptable.
Worse, sources with knowledge of the process said the required copies of The Blue’s proposal were delivered in a box, with its contents unbound and without dividers, requiring city officials to separate and bind them before they could be reviewed.
That’s not exactly the way to make a feel-good first impression, especially for a developer hoping to forge a long-term partnership with a local government.
Some might call it disrespectful.
But with only two development groups having responded to the second Three Corners RFP, city officials aren’t likely to dismiss one of them and leave themselves with no leverage in negotiations with the other.
Truth is, council members put themselves in a tough spot by botching the process last summer – because they can’t afford another similar debacle, which would further damage the city’s credibility.
They’ve left themselves with a no-win choice: Clearpath submitted a wonderful proposal, but is scrambling to replace its financial partner; and The Blue appears to have plenty of financing, but submitted an unimpressive proposal that the committee essentially rejected.
Yes, the council could allow the selection process to move forward in hopes that Clearpath finds a new financial wingman, or The Blue comes back with a more complete plan, before the committee conducts its interviews with the developers on March 31.
The council also could go through the selection process and then delay the start of the negotiations phase.
But should we even be in this situation, which is far less than optimal for a project expected to have a substantial impact on our community?
What’s the rush?
It’s obvious that public excitement about the Three Corners project has waned in the months since last summer’s crushing disappointment. The community momentum that pushed this ambitious endeavor forward for years has noticeably slowed.
In November 2022, nearly 80 percent of Vero Beach voters approved a referendum to develop the northern 17 acres of the Three Corners site – the property that contains the city’s abandoned power plant.
If that same referendum were on the ballot today, would it receive the same level of voter support? Probably not.
The ballot initiative almost certainly would pass, but it would not get the same rousing public endorsement we saw then.
There are more naysayers now, especially as the county continues to grow and community members become more sensitive to traffic, congestion and demands on resources.
Remember: City voters strongly rejected November’s referendum seeking an increase in residential density in Vero’s downtown district.
Besides, it’s not like the city doesn’t have another major project to be concerned with – specifically, the relocation of the municipal waste-water treatment plant from the banks of the lagoon to the Vero Beach Regional Airport.
With projected costs having soared to $178 million, city officials need to make that project their top priority through its completion in 2028.
The Three Corners development, expansion of the municipal marina and revitalization of downtown can wait.
