GROUND LEASE AGREEMENT FOR COUNTY-OWNED LAND LOCATED ON PHT

Board of County Commissioners · 2026-07-21 · resolution

The Board of County Commissioners adopted Resolution R-688-26, File Number 261263, approving the bifurcation of the Jackson Medical Towers Redevelopment Lease Agreement with RUDG, LLC for the second phase of development, for a term of 99 years, for the provision of workforce and affordable housing on County-owned land located on a portion of properties currently bearing Folio Nos. 01-3135-045-0010 and 01-3135-045-0020, with a total cumulative estimated amount of rental revenue to the Public Health Trust of $534,923,191.00 over the term. The Phase 2 Lease is with Residences at Wagner Creek, LLC, an entity affiliated with RUDG, LLC. The project involves refurbishing the existing Jackson Medical Towers structures and converting them to a 358-unit residential building with approximately 676 parking spaces, instead of demolishing the structures and constructing a new residential tower with 361 rental units. The residential unit income mix is modified so that a minimum of 20 percent of the residential units are maintained as workforce housing units and a maximum of 30 percent are unrestricted, instead of a minimum of 30 percent workforce housing and a maximum of 20 percent unrestricted. The planned 128-unit hotel tower is eliminated. The $135,000.00 initial rent payment is replaced with a capitalized lease payment estimated to be approximately $41,331,973.00. The construction schedule for completion of the second phase is accelerated from February 2032 to December 2029. A provision is added contemplating that the Tenant enter a sublease for the establishment of a vocational high school focused on health sciences on the leased premises. A provision is added giving the Public Health Trust an annual option to lease back a minimum of 20 percent of the parking space capacity (estimated to be 135 parking spaces) at discounted rates for employee parking. The Phase 2 Lease still requires that a minimum of 50 percent of the residential units delivered be maintained by Tenant as affordable housing units. The capitalized lease payment entails a lump sum payment by Tenant of ten percent of the fair market value of the existing improvements on the Phase 2 Lease premises, due on financial close (estimated to be $4,133,197.00), and the balance due subject to the terms of a promissory note, to be paid after 33 years (estimated to be $37,198,776.00, plus interest). The costs associated with the development, construction, and operation of the redevelopment project under the Phase 2 Lease will be the responsibility of the Tenant. The subject property is located in County Commission District 3. The resolution was introduced on 7/7/2026, the Housing Committee forwarded it to the BCC with a favorable recommendation on 7/14/2026, and the Board of County Commissioners adopted it on 7/21/2026.