Demolition deadline for Treasure Island in Daytona Beach Shores set for June 2

DAYTONA BEACH SHORES — By the time summer beach season rolls around, the deteriorating remains of the abandoned Treasure Island Resort, one of the beachside’s longtime eyesores, should be no more.

On Tuesday, the Daytona Beach Shores City Council voted in favor of final approval of a development agreement that provides incentives to the property’s owners, New York-based Acres Capital LLC, to demolish the deteriorating remains of the once popular hotel and redevelop the site into a new hotel-condominium complex.

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Once the agreement is officially recorded by the Volusia County Clerk’s office, an action that is expected to take place on Wednesday, it starts the clock ticking on a 120-day deadline for demolition of the existing skeletal remains of the once popular beachfront resort.

That would make the deadline for demolition June 2.

“This is what we’ve been waiting for, for years and years and years,” Mayor Nancy Miller said of the demolition of the abandoned building. “We accomplished that tonight.”

The abandoned shell of the Treasure Island has been a gutted hulk for nearly two decades, since a series of storms damaged the structure in 2004.

At Tuesday’s meeting, Miller and other Council members congratulated City Manager Mike Booker, City Attorney John Cary, Finance Director Kurt Swartzlander, City Planner Stewart Cruz, Building Official Fred Hiatt and other staff members for working diligently to hammer out an agreement with the property owner that was favorable to both sides.

Rob Merrell, Acres’ Daytona Beach attorney, also praised the city staff for its work in “rough and tumble” negotiations, adding that the resulting agreement merited “a victory lap for everybody.”

“Let’s all say Kumbaya and thank you,” Merrell told the Council.

It wasn’t all Kumbaya.

In casting the lone dissenting vote in the 4-1 decision to approve the agreement, Council member Richard Bryan said that the city had conceded too much by allowing deviations from the city’s land development code in the proposed plan to redevelop the property into a 13-story, 300-room hotel and a 23-story, 200-unit condominium building.

“While most residents would like to see the existing structure demolished in 120 days, I think most would consider allowing 23 stories with all of the deviations too high a price to and would agree that we should at least exhaust all other means of getting the structure demolished,” Bryan said.

Other Council members stated that the agreement included enough safeguards to ensure that the city’s interests were protected and expressed faith in the property owner’s intention to redevelop the site.

“They’re going to make sure it’s done right, and we’re going to keep an eye on it,” said Council member Michael Politis.

For city, demolition of eyesore Treasure Island is a priority

The leveling of that longtime eyesore has been the city’s priority throughout the process.

A “demolition safeguard” was added to the development agreement to ensure that the property owners meet the 120-day timetable.

It states that if demolition doesn’t commence within 60 days of the agreement’s final approval, the owner will place funds in escrow to cover demolition cost with an option for the city to access and finalize demolition within 120 days.

The safeguard section also requires that the property owner adequately restore and maintain the site within 150 days of approval, a process that includes removing debris, leveling the site, planting sod and building a fence or guardrail along the seawall.

When it comes to the plan for redeveloping the property, the agreement leaves open the option for two potential designs.

One plan, presented to the council in a series of artist renderings, calls for the construction of a single 17-story tower on the Treasure Island site, consisting of 300 hotel rooms and 200 multi-family/condominium units.

The other plan, initially presented to the city in August, proposes construction of a 13-story, 300-room hotel and a 23-story, 200-unit condominium building. At that time, the company estimated that it would invest $100 million into the project.

At Tuesday's meeting, Merrell offered a preview of new artist renderings of the two-building concept. Afterward, he said that is the property owner's favored design concept at this point.

"They are definitely leaning toward the two-building concept," Merrell said.

Timeframe for redevelopment

In negotiations, the city and the property owner differed on the timeframe to move ahead on the redevelopment of the site into the hotel-condominium project.

Ultimately, the agreement included Acres’ proposal for an eight-year timeframe to receive a building permit and pay permitting fees if the single tower design is selected. The city had proposed a five-year timeframe for receiving a certificate of occupancy.

If the two-building design is selected, the agreement includes Acres’ proposal for an eight-year timeframe to receive the building permit for the 13-story hotel and a 15-year timeframe to receive a certificate of occupancy for the 23-story condominium.

The city had proposed a five-year deadline for receiving a certificate of occupancy for the hotel and 15 years for a certificate of occupancy for the condominium.

Timely demolition of the existing Treasure Island is at the core of a stipulated settlement agreement between the city and Acres Capital that entitles the company to receive an estimated $1.4 million in projected city property tax rebates over 15 years to demolish the building and redevelop the site.

According to the agreement, approved by the City Council in August, the developer must demolish the existing skeletal remains within 120 days of the document’s final approval to become entitled for the incentives.

If the developer fails to meet the 120-day deadline, the city would then have the option of returning to the special magistrate to reopen a condemnation order.

The agreement states that at the time that the developer completes construction, the city will enroll the project in its Alternative Tax Relief program, offering a 100% rebate on city taxes for an initial five years; a 75% rebate for the next five years; and a 50% rebate for five years after that.

The developer will pay taxes during the time the project is under construction, said Kurt Swartzlander, the city’s finance director.

For the 15 years of the agreement, the city estimates that the project will increase city property tax collections by $364,655 for the hotel and by $3,230,520 for the condominiums. That’s a total of $3,595,176 for both properties.

A handful of residents addressed the Council, expressing a mix of optimism about the Treasure Island's impending demolition and concerns about how new construction on the site might affect nearby residential neighbors.

Anne Ruby, who lives close to the Treasure Island site, urged Council members to keep residents informed of proposed changes in the development plans.

"We need neighborhood meetings about the site plan," Ruby said. "I think it's important that it comes back to the neighbors for review."

This article originally appeared on The Daytona Beach News-Journal: Treasure Island demolition deadline set for June 2 in Daytona Beach Shores