Does Tradition Land Co. have a potential buyer for any of its property in Port St. Lucie?
Yes, it has a conditional agreement with Mattamy Homes, which is an Ontario-based home builder, to buy the remaining Southern Grove land that is approved for residential uses. The agreement with Mattamy Homes also is for the entire Western Grove DRI. Western Grove is the undeveloped western region of Tradition, which consists of 1,593 acres that can eventually be developed into 4,000 residential units. Mattamy Homes founded in 1978 is recognized as North America’ s largest privately-owned home builder, and Canada’ s largest residential home builder.
Why hasn’ t Tradition Land Co. sold a majority of the commercial property in Southern Grove?
Although the land may look the same, there is a great deal of difference between land authorized for residential use and land used for commercial purposes. One big distinction is the ability for property owners or marketing companies to identify buyers.
The 2004 Urban Land Institute Report pointed out that non-residential properties typically are sold at a much slower rate than residential parcels. Tradition Land Co. has stated that potential buyers have expressed concern that special assessments levied on Southern Grove have deterred potential commercial buyers.
What are these special assessments and why are they attached to this property?
In 2007, developer Core Communities worked with the City of Port St. Lucie to establish a Special Assessment District to fund $ 165,529,700 in necessary infrastructure in Southern Grove. These improvements included:
• A four-mile divided road( Village Parkway) from Becker Road to Tradition Parkway along with signalization;
• Water and sewer trunk lines on Village Parkway;
• Community Boulevard south of Tradition Parkway;
• The I-95 interchange at Becker Road;
• A four-lane, divided section of Becker Road from I-95 to Village Parkway
Special assessment bonds were issued to pay for the infrastructure work and parcels in Southern Grove and are assessed a yearly fee( called special assessment) to repay the debt on these bonds.
What happens if the property owner, Tradition Land Co., does not pay these special assessments?
In 2007, the City of Port St. Lucie enhanced the credit on the Southern Grove infrastructure bond that included roads, water and sewer by using a tool called a“ Covenant to Budget and Appropriate,” where the City promises to budget and pay if the owner fails to pay the special assessment.
As a courtesy, Tradition Land Co. notified the city last year of its intent to exit Port St. Lucie. By April 2, 2018 $ 5.2 million of Southern Grove taxes and assessments will have been paid. In addition, Tradition Land Co. will make an additional payment of $ 1.2 million in 2017 taxes and assessments upon the anticipated Mattamy Homes closing. The City will be responsible for paying the remaining balance which is approximately $ 1 million for tax year 2017.
The total financial impact for tax year 2018 in Special Assessment District assessments and taxes is estimated to be approximately $ 5.1 million. As parcels are sold, the City’ s obligation will decrease as new owners assume payments on their properties.