TEMPLE TERRACE — The Downtown Temple Terrace project, the centerpiece of the city's effort to reinvigorate its image, faces derailment after the developer informed the city that it wants to bow out of the project.
Vlass Temple Terrace, citing delays by the city and suggesting there is "no economically viable proposal'' that the City Council will agree to, has suggested in a letter from its attorney that the two sides terminate the relationship.
"Clearly it is time for Vlass and the city to arrive at a fair and reasonable parting of the ways that addresses the developer's damages and leaves the redevelopment in the hands of the city staff or a new developer to complete,'' said the letter from Vlass attorney David Smith.
Vlass is the third developer in eight years to attempt to create the downtown that Temple Terrace never had. Vlass signed its original agreement with the city in 2009 to build a $160-million office, retail, cultural and residential village on 30 acres along the east side of 56th Street from Bullard Parkway to the Hillsborough River.
The city, which owned the land, turned the property over to the developer with the stipulation that the village be created according to the city's master plan. A key provision of that plan specified that the first floors of the residence buildings in the northern section of the property would be reserved for retail, which the developer balked at, saying it was not economically feasible.
Smith said that in a proposal sent recently to the city, Vlass agreed to fit out a portion of the residence buildings with glass storefronts, and got no response to that.
"We caved in, but it wasn't enough," Smith said.
"Our view is, for whatever reason, they're really interested in driving us away.''
Mark Connolly, attorney for the city, said that there were other problems with the latest proposal, and a real sticking point is that Vlass wants the retail spaces to have much lower ceiling heights than the city wants.
The two sides have disagreed over myriad details of the proposed project, and work has been idled on the site for more than 14 months.
Connolly told the council this week that he left a message with Smith asking if they wanted to meet to discuss continuing to work together, or if they were interested only in dissolving the partnership. Smith answered that Vlass wants to end the relationship.
The council assigned Connolly, Mayor Frank Chillura and the incoming city manager, Gerald Seeber, to meet with Vlass to discuss the dissolution.
Connolly told the City Council he was drafting a response to dispute the assertions in Smith's letter.
"There's a lot of stuff in there that from the city's standpoint is factually inaccurate,'' he said in an earlier interview, specifically mentioning the allegation that the city is not prepared to work with the developer.
If the two sides agree to end the partnership, the contract calls for the city to get back its property after reimbursing Vlass for the money it has put into the project — a figure that totals "several million,'' according to the letter. But the matter could end up in a lawsuit.
"Anything can happen,'' said Connolly. But, he added, "if there's a way we can reach a reasonable resolution, my preference is always to avoid litigation.''
The split comes just as the two sides were anticipating the start of construction of the Arts and Education Center, which would face the planned residential buildings and was expected to attract residents and business owners.
Now, it appears the project is destined for another idle stretch, and the city will wait longer to reap the tax revenue it was eager to draw from a successful complex.
Council member David Pororilich, who could not attend Tuesday's council meeting, said earlier that the best thing for the city and for Vlass is to continue to try to work together. But he added there isn't much that can be done if Vlass is determined to leave.
Grant Rimbey, who was elected to the council in November, noted that distrust and ill feelings appeared to mark the relationship between city officials and the developer throughout the project.
"We would want to work with them,'' he said. "We're disappointed that they think they need to bow out.''
Philip Morgan can be reached at email@example.com or (813) 226-3435.