County Commission agrees to extend closing on parcel at 4644 N. Tamiami Trail in Sarasota, with goal of seeing affordable housing project open by Dec. 31, 2025

Financing and permitting delays cited by developers

This graphic shows the location of the project planned at 4644 N. Tamiami Trail in Sarasota. Image courtesy City of Sarasota

It took nearly an hour of discussion on Feb. 21, but the Sarasota County Commission ended up voting unanimously to approve a nearly month-long extension of the closing date for the sale of county-owned property located at 4644 N. Tamiami Trail in Sarasota, so two nonprofit organizations can construct 96 affordable housing units on the site.

Those organizations are Blue Sky Communities of Tampa and Community Assisted and Supported Living of Sarasota (CASL).

The most recent closing date they had been accorded was Feb. 24.

They are partnering on the initiative as a limited liability company called Blue CASL Tamiami, county documents have shown.

The concern that commissioners emphasized this week was the fact that, in late March 2022, the board members seated at that time allocated $4.2 million out of federal American Rescue Plan Act (ARPA) money to Blue Sky and CASL for the construction of what is being called New Trail Plaza on the North Tamiami Trail property. If that money is not spent by Dec. 31, 2026, County Administrator Jonathan Lewis pointed out, the federal government could “claw it back” from the county.

The agreement between the county and Blue Sky CASL Tamiami stipulated a Dec. 31, 2025 deadline for completion of the project, Lewis pointed out. That date was provided, he said, to give the commissioners an opportunity to turn over the $4.2 million to another entity that could put the money to use by the 2026 federal deadline, if Blue Sky CASL was unable to do so.

The motion that Chair Michael Moran ended up making on Feb. 21, after passing the gavel to Vice Chair Joe Neunder, called for the officers of Blue Sky to return up to $4.2 million to the county, if the agreement does not perform as provided for, in terms of the construction timeline.

This is the financing clause in the contract between Blue CASL Tamiami LLC and the county. Image courtesy Sarasota County

On several occasions during the Feb. 21 discussion, Shawn Wilson, president and CEO of Blue Sky, offered a personal guarantee that the officers of Blue Sky would pay back the ARPA money if the housing units are not finished by the county’s deadline.

Moran had asked Wilson for that guarantee. Moran — and other commissioners — stressed that they are stewards of taxpayer funds, regardless of whether those taxpayers are county residents.

During the Open to the Public comment period at the start of the Feb. 21 meeting, former Commissioner Jon Thaxton, senior vice president for community leadership with the Gulf Coast Community Foundation, which is based in Venice, had encouraged the commissioners to approve the closing extension.

“This project is one of the best recent examples of a successful public/private partnership,” he pointed out. “And most important, a critical distinction” is that it has been planned to serve households making as little as 30% of the Area Median Income for the North Port-Sarasota-Bradenton Metropolitan Statistical Area (MSA), as set by the U.S. Department of Housing and Urban Development (HUD).

In 2023, the Area Median Income for that MSA for all households was $98,700. HUD usually releases its annual figures by spring of each year.

This is HUD’s 2023 Area Median Income chart for the North Port-Sarasota-Bradenton Metropolitan Statistical Area. Image from HUD

Thaxton added, “This is the most difficult housing for this community to attain and it is badly needed. … Sarasota cannot afford to lose the opportunity to move this project forward.”

The July 2022 agreement between the county and Blue CASL calls for a mix of one-, two- and three-bedroom units which will have to remain in the price/rent range of 80% AMI or less for at least 50 years.

A shifting timeline and financial concerns

In remarks that opened the board discussion, Matt Osterhoudt, director of the county’s Planning and Development Services Department, explained to the commissioners that a Dec. 18, 2023 letter he had received from Shawn Wilson, president and CEO of Blue Sky, reported that the organizations were short $2.8 million out of the total they needed for the North Tamiami Trail project. However, Wilson wrote, Blue Sky and CASL were seeking the extra money “from a variety of sources,” including the State of Florida.

County staff included a copy of a document provided to the Florida Legislature, formally requesting the $2.8 million as an appropriation this year.

They also requested an extension of the closing date to Aug. 15 of this year, citing concerns not only the need to find the extra money but also about the length of time necessary to win the applicable City of Sarasota building permits, since the North Tamiami Trail property is within the city’s jurisdiction.

Subsequently, on Feb. 2, Osterhoudt continued, he received a letter from Blue CASL, reporting that the nonprofits had been able to eliminate the funding gap. That letter listed their financing sources, he added, including the $4.2 million in ARPA money.

The total budget for the New Trail Plaza project, a slide showed, is $30,319,629. The expense of the county land is $1,950,000.

This slide shows the funding sources for the project. Image courtesy Sarasota County

Prior to receipt of the December 2023 letter, Osterhoudt told the commissioners on Feb. 21, the nonprofits had requested — and had been given — two extensions on the closing date; County Administrator Lewis handled that administratively.

Then, on Feb. 20, he continued, Blue CASL sent county staff an email, which was forwarded to the commissioners, asking that the closing date be extended to April 30.

Staff did not recommend that the latest extension be granted, Osterhoudt said, given concerns about whether the ARPA money would be spent in time to meet the county’s Dec. 31, 2025 deadline.

Commissioner Mark Smith said he believed that all of the commissioners had received another email from Blue Sky CASL — dated Feb. 19 — asking for an extension of the closing date just to Feb. 28.

Lewis responded that he had not seen that; if he had, he said, he probably would have granted that, as well, on an administrative basis.

During the discussion, Wilson, the Blue Sky CEO, assured the commissioners that the organizations have all of the funding in place for the affordable housing project. On Feb. 14, he and Scott Eller, the CEO of CASL, also noted, they won the necessary approval of the City of Sarasota’s Planning Board to proceed with the initiative. However, they still must obtain the city building permits for the undertaking, Wilson added.

Eller told the commissioners, “We’re very confident that we’re going to be putting shovels in the ground in May or June.”

Shawn Wilson (left) listens as Scott Eller addresses the commissioners on Feb. 21. News Leader image

The City of Sarasota staff report for the Planning Board meeting said the proposal is for construction of a four-story, 90-unit multi-family residential building and a three-story, mixed-use building with six residential units and 3,040 square feet of nonresidential floor area.

Wilson further noted that the organizations had a “fully executed contract” in place with a general contractor that provides for a 423-day construction timeline. Therefore, the affordable housing units should be completed by Dec. 31, 2025, with time to spare.

Commissioner Neil Rainford was the first commissioner to express concern about the potential that the federal funding could be lost. “It just seems like there’s been varying hiccups that are kind of late in the game.”

Rainford added, “I find it hard to believe that anybody’s going to be able to build a project by December of 2025, based on the current climate in the building industry.”

Yet, Wilson of Blue Sky responded, “The market is slowing down.” Subcontractors are “very hungry,” he added. “For the first time in three years, we’re getting a lot of subs coming to us,” he said, asking when Blue Sky expects to have its next project ready to go under contract.

“We don’t want to lose this,” Commissioner Ron Cutsinger told his colleagues, referring to the affordable housing units. He suggested the March 21 closing date, instead of Feb. 28. “We’ve heard testimony under oath that the financing is in place.”

Commissioner Neunder asked Osterhoudt what would happen to the parcel located at 4644 N. Tamiami Trail if the deal could not be completed.

This is the site plan for New Trail Plaza. Image courtesy City of Sarasota

“You’d still have a surplused county-owned property,” which could be the focus of a new Request to Negotiate process for an affordable housing project, Osterhoudt pointed out.

Although Neunder expressed disappointment in the chain of events Osterhoudt had outlined, he added, “I am fully aware of the desperate need of affordable housing here in our community.”

Still, Rainford continued to express worries about the construction timeline. “I haven’t seen a project developed in 13 months in the last few years.”

Eller of CASL responded that CASL recently had completed a project on time in Port Charlotte, even with Hurricane Ian having struck that area in September 2022. The initiative involved 88 units, and the construction timeline “was roughly 420 days,” Eller noted — both of which figures were comparable to those associated with the New Trail Plaza project.

When Commissioner Neunder asked for more detail about the financing problems that generated the letter to county staff regarding the $2.8-million funding gap, Eller noted the interest rate hikes and higher inflation that resulted after the start of the COVID-19 pandemic in 2020. “The market changed.” Eller said. Friends who work in construction told him, he added, for an example, that plywood pieces that used to retail for about $18 were selling for $50 to $55.

Eller also pointed out that the jump in interest rates reminded him of the situation in the 1970s, when those rates climbed to between 18% and 20%.

Yet, Eller said, “We’re seeing a receding of [the interest rates] now.”

Wilson of Blue Communities told the commissioners, “The design and the planning process does take a long time, and it’s a delicate thing.” Given the city Planning Board sign-off on the project last week, he continued, “I feel like we’ve made consistent progress. … We’re right at the finish line now.”

On Feb. 16, Eller also noted, Blue CASL finally received the bank financing it had sought, inking an agreement with Truist. “There’s a lot of moving parts that make these deals rather complex,” he said.

Still, Eller emphasized that the team feels that the project will be completed and open for residents in September 2025.

Moran did ask the men what would happen if they received the $2.8 million they had requested from the Legislature, since they no longer need it.

Eller and Wilson explained that the project will take up only about half of the approximately 6.2-acre parcel. Since the back part of the property is zoned for single-family housing, Eller added, that money could be used to construct homes for young people who have aged out of foster care. If that did not prove possible, he said, Blue CASL would not accept the state money.