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Mathis Report: Walmart Health launches clinic construction PAGE 3

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AN EXPANDED VISION Record & Observer JACKSONVILLE

Downtown Vision Inc. wants a bigger service area, larger staff and a new HQ. JACKSONVILLE

Special to the Daily Record

RD River City Brewery apartments are planned at the site of River City Brewing Co. on the Downtown Southbank.

Record & Observer

RD River City apartments take step

Project design is “moving in the right direction.”

JACKSONVILLE

Record & Observer BY MIKE MENDENHALL STAFF WRITER

Photo by Mike Mendenhall

Downtown Ambassador Lionel Roberts, Downtown Vision Inc. CEO Jake Gordon and ambassador Michael Ryan meet at the public lounge area on Hogan Street. The nonprofit DVI is seeking to expand its service area and increase its staff.

BY MIKE MENDENHALL STAFF WRITER

owntown Vision Inc. — the agency whose ambassadors greet visitors and help keep the Urban Core clean and safe — wants to expand its borders, increase its budget, nearly double its staff and move to a new headquarters. The nonprofit DVI, founded in 2000, provides advocacy and services a business improvement district in a halfmile-square area of Downtown’s North-

bank and Southbank. The DVI board of directors wants City Council to expand its boundaries to 1.3 square miles. DVI CEO Jake Gordon said it’s a “commonsense expansion” and would allow DVI to deploy ambassadors into more areas on the Northbank and Southbank. Gordon says the expansion would capture recent and proposed residential and public park development in LaVilla and retail and corporate office growth on Riverside Avenue, including Fidelity National Information Services Inc.’s

Three firms chosen to compete for former Landing park design PAGE 2 The Basch Report: CSX having a ‘pretty good’ recovery PAGE 4 The top 10 sales of the week in residential real estate PAGE 12

new headquarters in Brooklyn. It would extend its work on the Northbank Riverwalk to the Riverside Arts Market. “We want to be able to add more value and add more people. With a lot more residents Downtown and with a lot more activity, there’s just a lot more need,” Gordon said. Increasing DVI’s footprint and taxable base would increase the nonprofit’s budget by about $875,000 annually from $1.5 million to $2.38 million, according to SEE DVI, PAGE 6

Downtown Development Review Board members said March 23 the latest design for Miami-based Related Group’s RD River City Brewery apartments is “moving in the right direction” and granted conceptual approval. The board voted 7-0 to advance architectural plans for the proposed $92 million apartment project to replace the River City Brewing Co. restaurant on the Downtown Southbank. The Driver, McAfee, Hawthorne & Diebenow law firm represents Related Group in Jacksonville. Firm partner Cyndy Trimmer said the developer and Miamibased MSA Architects redesigned the apartment in reaction to feedback that it did not fit “contextually” along the St. Johns River. “We’ve gone through many iterations of the site plan and the elevations to get where we are today,” Trimmer said. Before the final review, the Downtown Investment Authority staff asked Related to show plans to “soften” the top floor on the parking deck visible from upper floors on the nearby Prudential Financial building, with trees in raised planters.

MMENDENHALL@ JAXDAILYRECORD.COM

REVIEW & COMMENTARY

Back the bill that can save Florida’s economy Stem soaring property insurance rates. PAGE 8 VOLUME 3, NO. 43 • ONE SECTION

WHAT’S TRENDING

JACKSONVILLE DAILY RECORD / JACKSONVILLE RECORD & OBSERVER 2JaxDailyRecord.com

25, 2021 DAILY RECORD / JACKSONVILLE RECORD & OBSERVER THURSDAY, MARCH JACKSONVILLE

Big news doesn’t break just on Thursday. Here’s a look at some of the top stories published over the past week online at JaxDailyRecord.com and in the Jacksonville Daily Record that you may have missed.

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DOWNTOWN

Established in 1912, the Financial News & Daily Record, now the Jacksonville Daily Record, is published Monday-Friday and is the Official Court Newspaper of the Circuit Court and publisher of public notices in Duval County.

Firms selected for park competition

company’s work includes phase one of City procurement officials selected Jacksonville Record & Observer is a free weekly business newspaper available in the 10-acre Bay Park in Sarasota and three national firms March 18 to comDowntown Jacksonville and key business nodes throughout Jacksonville. To find a pete for the contract to design a public the 2015 Downtown Experience plan in location near you, visit jaxdailyrecord.com/rack-locations. Raleigh, North Carolina. riverfront park at the former Jacksonville Landing site. ■ Olin Partnership Ltd. of PhilaEditorial content focuses on news and trends, with a concentration on development, The city Professional Services Evalu- delphia. Olin is designing a 1.2-mile real estate, construction, law, companies, economic and industry trends and how local ation Committee voted 3-0 to select stretch of riverfront in Alexandria, and state government affects business. the companies that each will be paid Virginia, and in 1991 designed Bryant $125,000 to complete 50% of the dePark’s restoration in New York City. sign work for a minimum 4.5-acreSTAFF park ■ Perkins & Will Inc. of Chicago. for the site at 2 Independent Drive W., The company’s work includes historic Publisher / Matt Walsh Director of Advertising / Jay Lesowitz now called Riverfront Plaza. One of the jlesowitz@jaxdailyrecord.com Emancipation Park in Houston and mwalsh@jaxdailyrecord.com firms will be selected to complete its Waterfront Botanical Gardens in LouisPublisher Emeritus / James F. Bailey Jr. Advertising Coordinator / Codi Gildberg design. ville, Kentucky. jbailey@jaxdailyrecord.com adassist@jaxdailyrecord.com The candidates are: DIA CEO Lori Boyer said there will be Editor / Karen Brune Mathis Advertising Manager Janet Mohr a public meeting March/26 to provide ■ Agency Landscape + Planning LLC Legal kmathis@jaxdailyrecord.com legal@jaxdailyrecord.com the firms with site information. of Cambridge, Massachusetts. The Managing Editor / Monty Zickuhr mzickuhr@jaxdailyrecord.com

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Legal Advertising Associate / Rhonda Fisher rfisher@jaxdailyrecord.com Network Administrator / Erik Wagner webadmin@jaxdailyrecord.com

Main & Six Brewing Company plans Court Typeset / Paulaexpansion Steiner

Staff Writer / Katie Garwood kgarwood@jaxdailyrecord.com

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Jacksonville and Jacksonville Record & Observer division of The city Daily plansRecord to transform the former Jacksonville Landing are site ainto a park. Observer Media Group Inc.

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rooftop beer garden will be about 500 Main/&Mike Six Mendenhall Brewing Company plans Staff Writer of Circulation / Anne Shumate mmendenhall@jaxdailyrecord.com square feet. There also will be office an expansion that would bring another Director subscriptions@jaxdailyrecord.com space on the second floor. dining option to Springfield and the Business Manager / Angie Campbell Distribution / Timhe Reagan acampbell@jaxdailyrecord.com In addition, will add a 100-squareneighborhood’s first rooftop bar. distribution@jaxdailyrecord.com

foot outdoor patio and pave the adjaOwner Dennis Espinosa said he and cent lot for parking. his mother, co-owner Cindy Lasky, The expansion will bring Main & Six’s want to renovate a 3,600-square-foot PRESS RELEASE/INQUIRY/REPRINTS total space to about 7,200 square feet building next to the brewery and conat 1636 N. Main St. nect the two. That or space will house a online Submit a press release editorial inquiry said he will start construcrestaurant, kitchen, barrel aging room jaxdailyrecord.com/submit-news-release or emailEspinosa editorial@jaxdailyrecord.com. tion after the city issues the building and restrooms. Article reprints are available at jaxdailyrecord.com permits. He will add a 2,000-square-foot rooftop space above the addition. The

Daily Record Daily Record JACKSONVILLE ABOUT US

Jacksonville Daily Record and Jacksonville Record & Observer are a division of Observer Media Group Inc. Established in 1912, the Financial News & Daily Record, now the Jacksonville Daily JACKSONVILLE Court Newspaper of the Circuit Record, is published Monday-Friday and is the Official Court and publisher of public notices in Duval County. Jacksonville Record & Observer is a free weekly business newspaper available in Downtown Jacksonville and key business nodes throughout Jacksonville. To find a location near you, visit jaxdailyrecord.com/rack-locations. Editorial content focuses on news and trends, with a concentration on development, real estate, construction, law, companies, economic and industry trends and how local and state government affects business.

STAFF Publisher / Matt Walsh mwalsh@jaxdailyrecord.com

Director of Advertising / Jay Lesowitz jlesowitz@jaxdailyrecord.com

Publisher Emeritus / James F. Bailey Jr. jbailey@jaxdailyrecord.com

Advertising Coordinator / Codi Gildberg adassist@jaxdailyrecord.com

Editor / Karen Brune Mathis kmathis@jaxdailyrecord.com

Legal Advertising Manager / Janet Mohr legal@jaxdailyrecord.com

Managing Editor / Monty Zickuhr mzickuhr@jaxdailyrecord.com

Legal Advertising Associate / Rhonda Fisher rfisher@jaxdailyrecord.com

Associate Editor Legal Affairs / Max Marbut mmarbut@jaxdailyrecord.com Staff Writer / Katie Garwood kgarwood@jaxdailyrecord.com

Network Administrator / Erik Wagner webadmin@jaxdailyrecord.com Court Typeset / Paula Steiner admin@jaxdailyrecord.com

Staff Writer / Mike Mendenhall mmendenhall@jaxdailyrecord.com Business Manager / Angie Campbell acampbell@jaxdailyrecord.com

Director of Circulation / Anne Shumate subscriptions@jaxdailyrecord.com Distribution / Tim Reagan distribution@jaxdailyrecord.com

PRESS RELEASE/INQUIRY/REPRINTS Submit a press release or editorial inquiry online jaxdailyrecord.com/submit-news-release or email editorial@jaxdailyrecord.com. Article reprints are available at jaxdailyrecord.com

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only ..........$66 per year 2 years ................................... $154 There’s a shortcut to Thursday staying in the loop Single copy ......................35 cents 1 year ........................................$89 6 monthsDon’t .................................$55 miss a story. Subscribe to the Daily Brief and we’ll send our top news to you Monday-Friday morning via email. To sign up, visit JaxDailyRecord.com and look the “Sign up” box, enter your email and HOW TOforADVERTISE you’ll be set. Display & Digital Advertising: Call Jay Lesowitz at (904) 356-2466 or email advertise@jaxdailyrecord.com

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DEVELOPMENT TODAY

JaxDailyRecord These are the largest commercial building permits by job cost issued March 23 by the city of Jacksonville.

POSTAL INFORMATION Heritage Signs Inc., two permits for APARTMENTS monument and wall signs, $19,797. Sydney Trace Apartments, 8575 Jacksonville Daily Record (USPS 190-620) is published daily except Saturday, Sunday Bread & Board, Provisions, Merchants is Memorial Tier 1 PoolsDay,The & legal holidaysWay, (Newcontractor Year’s Day, Independence Day, Labor Day, Cocina, 100 Bay St., and Spasand LLC, install pool, Thanksgiving Christmas) by$115,000. Daily Record &Estrella Observer LLC, 121 W.W. Forsyth St., contractor SignsFlorida Inc., three Suite 150, Jacksonville, FL 32202. Periodicals postage paidis atHeritage Jacksonville, permits forwill wall and projection signs, OFFICE, BANK, PROFESSIONAL and at additional mailing offices. Under no circumstances any news or records $15,419. in this newspaper is for our RowCounty House,be 1561 San Marco of Duval suppressed forBlvd., anyone. Information Florida Pain, Physicians, 2386 Dunn contractor Building Dynamics Inc., subscribers onlyisand must not be used by anyone for publication purposes. Ave., No. 111, contractor is Heritage 2,256 square feet, ADA restroom and Signs Inc., three permits for wall signs, HVAC renovation, $50,000. POSTMASTER $10,646. San Jose Center Corp., 8847 San Integration 725 Nautica Drive, Blvd., contractor is International SendJose address changes to Jacksonville Daily Record, P.O. BoxSpa, 15456, North Hollywood, Management Co. LLC, 904 square feet, No. 104, contractor is Heritage Signs CA, 91615-9965 Inc., two permits for wall signs, $9,982. tenant build-out, $27,054. DESIGNATIONS Florida, Pain, Physicians, 4796 Tina’s Beauty Care,OFFICIAL 10057 San Jose Blvd., contractor is Hanul Construction Hodges Blvd., contractor is Heritage The Official for The Official The Official Court Signs Inc., three permitsNewspaper for wall signs, LLC, 1,048 square feet, tenant build- Newspaper the U.S. Bankruptcy Court of The Jacksonville Bar Newspaper of Duval $8,709. out, $26,500. for the 6531 Middle DistrictBlvd., of Association, Nov. Caliber 21, 1926.Collision, County by Order of the Blanding Florida, Jan. 4, 1947. Circuit Court, July 7, 1961. contractor is 75 Lighting & Signs LLC, SIGNS wall sign, $1,500. 24/7 Pediatric Care Centers, Open AFFILIATIONS 24 Hours 7 Days a Week, 8990 Florida Press Compiled by Daily Record Staff RG Skinner Parkway, contractor is Association

Thursday only ..........$66 per year Single copy ......................35 cents

JaxDailyRecord

POSTAL INFORMATION Jacksonville Daily Record (USPS 190-620) is published daily except Saturday, Sunday & legal holidays (New Year’s Day, Memorial Day, Independence Day, Labor Day, Thanksgiving and Christmas) by Daily Record & Observer LLC, 121 W. Forsyth St., Suite 150, Jacksonville, FL 32202. Periodicals postage paid at Jacksonville, Florida and at additional mailing offices. Under no circumstances will any news or records of Duval County be suppressed for anyone. Information in this newspaper is for our subscribers only and must not be used by anyone for publication purposes.

POSTMASTER Send address changes to Jacksonville Daily Record, P.O. Box 15456, North Hollywood, CA, 91615-9965

OFFICIAL DESIGNATIONS The Official Court Newspaper of Duval County by Order of the Circuit Court, July 7, 1961.

The Official Newspaper of The Jacksonville Bar Association, Nov. 21, 1926.

AFFILIATIONS Florida Press Association

The Official Newspaper for the U.S. Bankruptcy Court for the Middle District of Florida, Jan. 4, 1947.

JACKSONVILLE DAILY RECORD / JACKSONVILLE RECORD & OBSERVER

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THURSDAY, MARCH 25, 2021

Walmart launches health clinic construction

The city issued a permit for construction of a Walmart Health clinic at the retailer’s Southwest Jacksonville Supercenter in Collins Plaza. The Collins Road center is one of five area Walmart clinics in review for construciton. Walmart wants to open seven in Northeast Florida. Golden & Associates Construction LLC of Birmingham, Alabama, is the contractor for the $900,000 construction of a 6,495-square-foot clinic that will be an expansion of the Supercenter at 7075 Collins Road. Walmart Health offers pri-

mary care, urgent care, dental and lab services, imaging, counseling, and optical and hearing services. In addition to Collins Plaza, Bentonville, Arkansas-based Walmart intends to build clinics at 6830 Normandy Blvd., 11900 Atlantic Blvd., 4250 Philips Highway and in Middleburg. Walmart announced Sept. 17 in a blog post it would build seven Walmart Health centers in Jacksonville, with the first opening in early 2021. Walmart opened its first center in September 2019 in Dallas, Georgia.

Priority Tire readies Tradeport space Tire distributor Priority Tire is preparing its 100,000-squarefoot space in Jacksonville

RETAIL NOTES Gate to San Pablo: Gate Petroleum Co. is building a gas station and convenience store on 3.6 acres at 4121 San Pablo Parkway. Construction of the 6,544-square-foot store, canopy and dumpster enclosure totals almost $2.9 million, according to city-approved permits March 17. The site is near Mayo Clinic. CVS in Nocatee: St. Johns County issued a permit for the $2 million construction of a 14,900-square-foot CVS Pharmacy at 630 Crosswater Parkway in Nocatee. It is expected to open in early 2022.

International Tradeport in North Jacksonville. The city issued a permit March 12 for Haskew Company to build-out at 1750 Airport Road, No. 102, at a cost of $847,635. Dallas-based Jackson-Shaw, a national real estate development company, announced in January it leased the industrial space in part of the International DC 1 building to Priority Tire. Priority Tire has been leasing 52,000 square feet of space since 2019 in Jackson-Shaw’s International DC 5. Jackson-Shaw anticipates Priority Tire will move in April. Priority Tire will almost double in size with the relocation and expansion. Jackson-Shaw developed the 200,000-square-foot International DC 1 at 1750 Airport

Inc. of Wisconsin is the contractor for the $225,000 project to renovate 9,372 square feet of space at 9625 Crosshill Blvd. Scrubbles in Mandarin: JEA received a service availability request for Scrubbles car wash to build at 9826 San Jose Blvd., at Pall Mall Drive. Baker Design Build is the agent. The site’s history includes having been Pasta Market, Hops Grill & Brewing, Cross Creek Steakhouse, Physicians Medical Center and an urgent care center.

Walmart renovations: The city is reviewing permits for Walmart to renovate its Supercenters at 10991 San Jose Blvd. in Mandarin, 6830 Normandy Blvd. in West Jacksonville and 13227 City Square Drive in River City Marketplace in North Jacksonville, each at a cost of $500,000.

Dollar Generals to Northwest Jacksonville: JEA received a serviceavailability request for Concept Development Inc., which develops Dollar General Stores, for a proposed 10,640-square-foot retail store at Soutel Drive and Norfolk Boulevard. At Edgewood Avenue North and West 12th Street, the city calculated a mobility fee of $91,759 for Concept Development LLC to build a 10,640-squarefoot store on 2 acres.

Five Below to OakLeaf: Five Below intends to build-out in OakLeaf Town Center. Horizon Retail Construction

RaceTrac to Northwest Jacksonville: The city is reviewing plans for RaceTrac to build a gas station and

Blue Orchid signs 10-year lease Blue Orchid Thai Cuisine negotiated a 10-year lease for its 1551 Riverside Ave. location, its second restaurant in Jacksonville, said Jacksonvillebased NAI Hallmark. It also is the first step in a multifamily development. NAI Hallmark Vice President Austin Kay and Senior Associate Eric Yi represented the landlord, Dr. Frank Schiavone of Schiavone Enterprises, who is developing the property as Riverside Village.

convenience store of 8,100 square feet and 20 fueling positions on 4.39 acres at 6635 Pritchard Road, at Perimeter Industrial Parkway West in Perimeter West Industrial Park. Connelly & Wicker Inc. is the civil engineer. RaceTrac Petroleum Inc. paid $2.6 million for the site Dec. 15. The land is at northeast Interstate 295 and Pritchard Road. Costco to St. Augustine: St. Johns County is reviewing a permit application for Costco Wholesale to build a warehouse club and 18-pump fuel facility with parking, paving, curbing and site utilities along World Commerce Parkway. The 156,911-square-foot facility is planned on 18.17 acres. Tire Outlet to Saint Johns: St. Johns County issued a permit for Tire Outlet to build a 6,720-square-foot store at 1215 St. Johns Parkway in Saint Johns at a cost of $700,000. Gate car wash in St. Johns: Gate Express Carwash wants to build a 5,089-square-foot car wash on 3 acres of a 4.03-acre site at 2370 Florida 16 in St. Augustine in St. Johns County. Plans show a 2,062-square-foot fast-

KMATHIS@ JAXDAILYRECORD.COM @MATHISKB (904) 356-2466

food restaurant will be demolished. Pet Supplies Plus to Lakewood: The city issued a permit March 10 for the $480,000 build-out to combine two tenant spaces at Lakewood Promenade into a 7,279-square-foot Pet Supplies Plus. Engelke Construction Solutions LLC of Brunswick, Ohio, is the contractor for the project at 1614 University Blvd. W., next to the closed Stein Mart store. 7-Eleven to Durbin: St. Johns County is reviewing an application for 7-Eleven to develop a 4,650-square-foot gas station with eight fueling positions on Outparcel 10 at Durbin Creek Crossing. The 2.5-acre site is south of Race Track Road and west of County Road 2209. Tractor Supply to Middleburg: The St. Johns River Water Management District is reviewing an application for Tractor Supply to build a 22,433-square-foot store plus a fenced outdoor sales area on 5.03 acres at 1701 Blanding Blvd. in Middleburg in Clay County. Common Oak Engineering LLC of Orlando is the civil engineer.

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The retailer intends to open seven locations in Northeast Florida.

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Walmart Health clinics offer primary, urgent, dental and other care.

“This was a deal that required a tremendous amount of patience from all parties involved as we dealt with the uncertainty caused by the Covid-19 pandemic,” Yi said in a news release. He said Schiavone was committed “to secure a thriving restaurant concept as part of his overall redevelopment plans, and Blue Orchid matched our enthusiasm for this site to serve as their flagship location.” Lara Bahri with CBRE represented Blue Orchid, whose first restaurant is in Harbour Village. “Riverside Village will be a great balance of an outstanding restaurant and modern apartments in historic buildings,” Schiavone said in the release. The property comprises four medical and office buildings on 1.3 acres at Riverside Avenue and Memorial Park Drive with views of Memorial Park. The release said one medical building is being converted into the restaurant and the remaining three are being converted to multifamily use.

THE MATHIS REPORT

KAREN BRUNE MATHIS EDITOR

Road and the 93,600-squarefoot International DC 5 at 1594 Transport Court. “Since becoming a tenant at International DC 5, Priority Tire has experienced tremendous growth,” said Tyler Newman, senior director at Cushman & Wakefield, in a previous news release. Newman said International DC 1’s location in the Tradeport allowed it to expand operations without making a major move. Jackson-Shaw said in January about 40,000 square feet is available for lease in International DC 1 and 52,000 square feet is available in International DC 5.

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JACKSONVILLE DAILY RECORD / JACKSONVILLE RECORD & OBSERVER

THURSDAY, MARCH 25, 2021

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THE BASCH REPORT

CSX is having a ‘pretty good recovery’ Patriot selling Tampa property Patriot Transportation Holding Inc. said in an SEC filing last week it agreed to sell 25 acres of land in South Tampa for $9.5 million. The Jacksonville-based trucking company said the land has been used for an operating terminal and it intends to relocate the facility to another site in the Tampa market. Patriot said it expects to close the sale in the current fiscal year.

MARK BASCH CONTRIBUTING WRITER

CEO James Foote tells investor conference he’s optimistic but “it’s clearly not nirvana.” After a difficult February, CSX Corp.’s business is recovering well in March, CEO James Foote said last week. However, the situation isn’t perfect, Foote said at an investor conference sponsored by J.P. Morgan. “The railroad, under the circumstances, is actually running pretty good,” he said. But, “it’s clearly not nirvana.” Business was looking up in January after the 2020 pandemic-related slump but “February slammed us in the head,” Foote said, as rough weather affected the northern part of the company’s rail network. Jacksonville-based CSX operates throughout the eastern half of the U.S. “February was not a good month from a revenue and a cost standpoint,” with rising fuel prices increasing expenses, he said. Despite the challenges, Foote remains optimistic. “Overall, I think we’ve adapted. We’ve shown to the world — not only CSX but the railroad industry — that we’re a lot more nimble and we’re able to adapt and able to work our way through just about anything they can throw at us,” he said. Foote said 2021 has brought a “good, solid start, a big bump in the road, and a pretty good recovery right now into March.”

CSX calls Pan Am a ‘minor’ deal In November, CSX Corp. announced its first railroad acquisition in more than two decades, but the company doesn’t want anyone to think it’s a big deal.

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CSX acquired Pan Am Railways in November.

The company’s application with the U.S. Surface Transportation Board to approve its purchase of Pan Am Railways Inc. said the deal should be considered a “minor” transaction. The acquisition of Massachusetts-based Pan Am’s 1,800-mile rail network would expand the company’s operations in New England. CSX said in a Surface Transportation Board filing last week the acquisition would be “an efficient, end-to-end extension of CSXT’s network into New England that raises no competitive issues.” CSX said it had discussions with customers and communities affected by the deal before filing its application with the transportation board in February. “CSX did not immediately file an application for STB approval of the transaction because CSX wanted to address any concerns about potential competitive effects before seeking STB authorization,” it said in last week’s follow-up filing. The Surface Transportation Board has three classifications for mergers: major, significant and minor. If the Pan Am deal was deemed significant, it would add 75 more days to the regulatory process than if the deal is classified as minor, CSX said in last week’s filing. Foote was not asked about the Pan Am deal or other railroad mergers at last week’s conference. The conference occurred before a major rail deal was announced March 21, a $29 billion merger of Canadian Pacific Railway Ltd. and Kansas City Southern.

Black Knight adds mortgage broker system Black Knight Inc. said last week it acquired a cloud-based loan origination system for mortgage brokers from NexSpring Financial. Jacksonville-based Black Knight already is the dominant company in technology for mortgage lenders, providing processing services for 64% of all U.S. first mortgage loans. The addition of NexSpring’s system allows the company to expand its reach. In a news release, Black Knight CEO Anthony Jabbour said mortgage brokers “represent the fastest-growing origination channel in the industry.” Terms of the deal were not announced.

International Baler sales rise International Baler Corp. said in a Securities and Exchange Commission filing last week that sales in its first quarter ended Jan. 31 rose 16.9% to $2.35 million. The Jacksonville-based company said it sold more balers used for recycling and waste disposal in the quarter, and a 38.5% rise in parts and service sales also helped increase revenue. International Baler had a loss from operations of $174,018 in the quarter. However, it recorded income of $626,466 from a Paycheck Protection Program loan that was forgiven. Helped by that gain, the company had net income of $489,339, or 9 cents a share, in the quarter.

Shoe Carnival names new CEO Shoe Carnival Inc. named a new chief executive last week to replace the retiring Cliff Sifford. Mark Worden, the company’s president and chief customer officer, will become CEO on Sept. 30. Sifford will remain vice chairman of the board of the Evansville, Indiana-based footwear chain. Former Jacksonville Jaguars owner Wayne Weaver is chairman and the largest shareholder of Shoe Carnival. He and his wife, Delores, control 29% of the company’s stock, according to a recent SEC filing. Worden, 47, joined Shoe Carnival in 2018 as an executive vice president. “When Mark joined Shoe Carnival nearly three years ago, our objective was to bring onboard an executive officer who would be positioned to take over as CEO at the right time,” Sifford said in a news release. Weaver said in the release he has “the utmost confidence in his ability to lead the Shoe Carnival team and deliver strong performance as we enter this new chapter.” Shoe Carnival also announced it is raising its quarterly dividend by 5 cents a share to 14 cents.

Ashford hotel occupancy drops Heading into Memorial Day weekend last May, executives of Ashford Hospitality Trust Inc. expressed optimism about a business rebound at its One Ocean Resort hotel in Atlantic Beach. They were hoping it was a sign of a post-pandemic

comeback for the hotel industry. However, the company’s annual report filed with the SEC last week showed how difficult 2020 was for its 103 hotels. The 193-room One Ocean Resort’s occupancy for the full year was just 57.41%, down from 71.91% in 2019, the annual report said. Ashford also owns a 120room Marriott Residence Inn in Jacksonville that had 59.66% occupancy last year, down from 82.08% in 2019, and a 119-room Hilton Garden Inn that had just 43.65% occupancy, down from 73.55%. The three Jacksonville-area properties did better than the rest of Ashford’s portfolio, as total occupancy was just 34.37% at all of its hotels, down from 76.35% the previous year. Another publicly traded hotel owner last week reported similar data for its Jacksonville property. Condor Hospitality Trust Inc. said its 120-room Jacksonville Courtyard by Marriott was 52.2% occupied in 2020.

American Outdoor beats forecasts American Outdoor Brands Inc.’s stock jumped higher last week after reporting earnings well above analysts’ forecasts. The outdoor gear company reported adjusted earnings of 82 cents a share for its third quarter ended Jan. 31, up from 13 cents the previous year and better than analysts’ consensus forecast of 36 cents, according to Nasdaq. Sales jumped 91% to $82.6 million. American Outdoor’s stock rose as much as $5.67 to $28.89 on March 18 after the report. American Outdoor closed its Jacksonville warehouse two years ago and consolidated operations at its headquarters in Missouri. The company operated the 100,625-square-foot facility at 7720 Philips Highway after acquiring a Jacksonville company called Ultimate Survival Technologies Inc. for $32.3 million in 2016. MBASCH@ JAXDAILYRECORD.COM

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FROM STAFF

File image

PEBB Enterprises and Falcone Group announced March 16 they closed on the purchase of 47 acres in the Beachwalk community, property they have planned to purchase since December.

ST. JOHNS

DUVAL

ST. JOHNS

$13,250,000

$6,000,000

$4,905,419

$4,475,000

$4,302,100

Beachwalk Shore Drive, St. Augustine

3605 Philips Highway, Jacksonville

Jacksonville

Avenues Walk Boulevard, Jacksonville

Type: Undeveloped mixeduse Parcel size: 47 acres Buyer: Beachwalk Retail Center LLC Seller: Beachwalk Retail Developers LLC

Type: Jacksonville Ice & Sportsplex Parcel size: 10.11 acres Building size: Two buildings totaling 104,770 square feet Buyer: JICE LLC, the Jacksonville Icemen Seller: PSF I JAX Metro LLC

1711-1771 Dobbs Road and 550 Florida 207, St. Augustine

ST. JOHNS

DUVAL

ST. JOHNS

DUVAL

$4,200,000

$3,900,000

$3,025,000

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11460-11504 Boote Road, Jacksonville

38 Marine St., St. Augustine

Type: Open storage Parcel size: 20.69 acres Building size: 2,451 square feet Buyer: Altenburg Properties LLC Seller: Bowser Properties LLC

Type: The Kenwood Inn bed and breakfast Parcel size: 0.21 acres Building size: 9,885 square feet Buyer: Mahavir Prabhu LLC Seller: Patricia D. Dobosz and the Dobosz Family Trust Previous sale: $1,400,000 in 2008

North Ponce de Leon Boulevard, St. Augustine

Ashley, Johnson, Church and Duval streets, Jacksonville

Type: Commercial Parcel size: 3.5 acres Buyer: Gate Petroleum Co. Seller: San Sebastian at the Landing Commercial LLC

Type: Site for potential JEA secondary headquarters Parcel size: 2.27 acres Buyer: JEA Seller: LaVilla Partners III LLLP

Type: Motel Parcel size: 3.65 acres Building size: Five buildings totaling 66,844 square feet Buyer: The Knights 18 St Augustine LLC Seller: Diamond Eagles LLC Previous sale: $1,275,000 in 2013

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Type: 16 homes for rent Parcel size: Not available Building size: Not available Buyer: CPI/Amherst SFR Program II Owner LLC Seller: ARVM 5 LLC

Type: Commercial Parcel size: 30 acres Buyer: UG2 Avenues Walk FL LP Seller: Kimco Avenues Walk LLC

Marital/ Family Law

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Type: Light industrial and church Parcel size: 10.58 acres Building size: Five buildings totaling 81,092 square feet Buyer: 1711 Flex LLC Seller: Mulligan Way Inc.

COMMERCIAL REAL ESTATE

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THURSDAY, MARCH 25, 2021

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DVI CONTINUED FROM PAGE 1

Gordon’s March 17 presentation to the Downtown Investment Authority. DVI says it would use the money to expand its workforce from 16 to 30 employees, with 11 new Downtown Ambassadors. For the service area to expand, it must be approved by City Council. The plan cleared its first hurdle March 17, when the DIA board, responsible for implementing the city’s Downtown economic investment policy, voted 9-0 to recommend the expansion. Legislation to finalize the expanded boundaries was not filed with Council as of March 24. The expansion would result in a new tax for property owners in the expanded area. DVI is funded by a 1.1-mil tax assessment. “All property owners are cautious about the money they spend but they like when they get what they pay for,” Gordon said. “I think we’ve proven at Downtown Vision, and definitely over the last five years since I’ve been here, that we are open and accountable and a valuable resource Downtown.” A NEW HEADQUARTERS

DVI also seeks a larger headquarters that would include retail space. Gordon is working with Mayor Lenny Curry’s administration to share the cost to build-out 14,600 square feet at 33 W. Duval St. on the ground floor of the Jacksonville Main Library parking garage. The space is owned by the city. Gordon said that in addition to

THURSDAY, MARCH 25, 2021

its offices, the space would have a coffee shop and a store that sells “made in Jax” products. He hopes filling the long-empty space would boost foot traffic and complement nearby Main Street Park. “It’s kind of an important corridor. At the same time, there’s almost nothing going on right there right now,” he said. Gordon said the move is not definite. The Curry administration will be weighing the project with others in the city Capital Improvement Program in the 2021-22 budget. The city is reviewing a building permit application from DVI for a $99,999 project at the site for the first phase of a build-out. Gordon said filing the permit application was to give the Curry administration an idea of the project cost as budget decisions are made. If city funding is approved, Gordon said work could begin in late 2021 or early 2022. ADDING RESIDENTIAL

In addition to its expansion, DVI is asking Council to add some Downtown residential properties to the tax assessment for the first time. The Council legislation approved in 2000 that created DVI was supposed to phase in residential assessments, but that was not implemented. Gordon said the Great Recession of 2007-09 coupled with the fear of losing interest from residential developers likely were contributing factors. He said DVI is not hearing those same concerns from district property owners today. “We deliver value Downtown and a lot of the value we deliver is

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Proposed Downtown Vision Inc. boundaries

Northbank north of McCoys Creek: Bounded on the west by Lee Street; the north by State Street; the east by Hogans Creek; and the south by McCoys Creek and the St. Johns River. Northbank south of McCoys Creek: Bounded on the west by Interstate 95; the north by River-

felt by the residents,” Gordon said. “They’d like to see more of it.” DVI’s expansion won’t affect all residential properties. People who own their homes within the boundaries with a homestead property tax exemption will not be assessed. Residential construction would have a five-year exemption after receiving a certificate of occupancy. Gordon said this would give new products time to achieve market stability. Affordable housing that receives money through the Florida Housing Finance Corp. and

side Avenue; the east by the Acosta Bridge; and the south by the St. Johns River. Southbank: Bounded on the west and north by the St. Johns River; the east by Alamo Street; and the south by Interstate 95.

adaptive reuse projects funded through the city’s Historic Preservation Trust Fund also would not pay. “But I think it’s perfectly fair to levy the additional costs after the property has been stabilized for any of these multifamily developers,” said DVI board member Elias Hionides. “Those developments are lucrative for those developers and I think they should be contributing equally into the pool funds.” Hionides, a Downtown property owner and vice president at real estate brokerage Petra, wants

more ambassadors on the street for Downtown cleanliness and safety and said the next expansion for DVI should be the entire Downtown footprint. “I’ve seen a direct benefit from what Downtown Vision and the ambassadors do. I think it’s the right direction for DVI and Downtown to encompass what DIA considers the Downtown boundaries,” he said. MMENDENHALL@ JAXDAILYRECORD.COM @MIMENDENHALL (904) 356-2466

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THURSDAY, MARCH 25, 2021

Promotions, hirings and happenings for business people in Northeast Florida. Send items to kmathis@jaxdailyrecord.com

Miller

Harding

Palcic

Edwards

Latham

Rusnak

Warner

Van Aken

Spencer

Robinson

Bourcier

Dreicer

Harms

Casamatta

Caron

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Jacksonville City Council approved Mayor Lenny Curry’s appointment of Abel Harding to the Jacksonville Transportation Authority board of directors. He will serve a four-year term on the board, filling the vacancy from former board Chair Isaiah Rumlin, whose term ended in 2020. Harding is the market president for IberiaBank and First Horizon Bank.

report to head coach Urban Meyer and General Manager Trent Baalke. Charlie Latham joined Clay County as director of environmental services. He served as mayor of Jacksonville Beach for two terms. GreenPointe Holdings LLC promoted Chris Rusnak to vice president, accounting and investor relations. Crowley Maritime Corp. promoted Dan Warner to chief financial officer, consolidating financial strategy, resources and services under his leadership.

First Florida Credit Union named Ashleigh Robinson as community relations and member development manager. The Jacksonville Historical Society hired Paul Bourcier as the nonprofit’s music history coordinator. The Chappell Schools board of directors announced that CEO Nancy Dreicer will retire June 1 after eight years in the position. Sue Harms, Chappell’s recently retired chief financial officer, will be the interim CEO. University of North Florida biology professor Dale Casamatta received an $88,540 grant from the National Science Foundation to continue his research on algal mats.

team with the appointment of John Rutherford as senior vice president of multifamily investment sales and Luke McCann as senior associate. Reputation Ink promoted Steven Gallo from content marketing manager to director of content and PR. Shelby Gambrell was promoted from client services manager to director of account services. Florida Eye Specialists, a multispecialty eye practices in North Florida, added doctors Kathryn Freidl, McGregor Lott and Kenzo Koike as partners to the practice.

Amy Palcic, formerly of the Riverside Avondale PreservaAcosta appointed Mike Van Aken Houston Texans, joined the tion announced service awards: as chief human resources officer Jacksonville Jaguars on Feb. 25 to oversee the company’s HR as the team’s vice president of ■ Good Neighbor Awards: Cool division, including talent acquisifootball communications, asMoose Cafe owners Tony and suming the senior PR role previ- tion and deployment, talent man- Tom Caron has joined The Laurie Jarvi; Riverside Park Community Foundation for agement, diversity and inclusion ously held by Dan Edwards. United Methodist Church; Northeast Florida as director of and HR operations. Edwards was named senior Missy Kampmeyer donor services. vice president of Jacksonville ■ Community Support Award: First Community Mortgage in Tradition and Alumni. Edwards Margaret Tocknell and the RAP NAI Hallmark expanded its St. Augustine named Cassidy will report to Jaguars President Transportation and Infrastrucmultifamily investment1 sales Spencer as vice president. Mark Lamping while Palcic will GRHK-20001 GREYHAWK__JACKSONVILLE DAILY RECORD AD__10.375x8__SEPT2020.qxp_Layout 9/4/20 10:12ture AM Committee Page 1

■ Project of the Year: City of Jacksonville and Karissa Moffit for the Oak Street bike lanes ■ Business Partner of the Year: Stephanie Dale of Go Tuk’N ■ Public Partner of the Year Award: Jacksonville Sheriff’s Office ■ COVID-19 Innovation Award: Shana David-Massett and Tim Massett, owners of Sun-Ray Cinema ■ Riverside Arts Market Maker of the Year Award: Bello Boopie owner Noel Michael

Gov. Ron DeSantis announced several area appointments: Jim McCarthy, Ponte Vedra, president of the North Florida Land Trust, to the Environmental Regulation Commission. John Rood, St. Augustine, chairman of The Vestcor Companies, to the Florida Prepaid College Board. Jason Barrett, St. Augustine Beach, CEO of Flagler Health+, to the University of North Florida board of trustees.

PEOPLE ON THE MOVE

John J. Miller will serve as Swisher’s president and CEO. Miller has served in senior leadership during his tenure at Jacksonville-based Swisher, including as president since 2017.

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3645 Royal Pines Drive | Orange Park, FL 32065 Across from Publix at Oakleaf Commons off Oakleaf Plantation Parkway.

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THURSDAY, MARCH 25, 2021

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REVIEW AND COMMENT

The bill that can save Florida’s economy

MATT WALSH PUBLISHER

Rising property insurance rates are on the verge of popping Florida’s housing bubble and the economy — all because of lawsuits. Of all the bills filed this spring in the Legislature, Senate Bill 76 is far and away the session’s most important legislation. Not election integrity. Not COVID liability. Not education. Not even the budget. It’s SB 76. Filed by Bradenton Sen. Jim Boyd, SB 76 deals with the mundane subject of property insurance. Here’s the nub of it: If Sen. Boyd’s bill passes, it will save Florida’s housing market from collapse — and save Florida’s economy. If it fails, Florida’s housing bubble will pop. The real estate sales markets for residential and commercial properties will come to a halt. And the ripple will spread harsh economic effects throughout all of Florida: ■ Property insurance rates — already rising between 20% and 50% in the past year — will double within three years. ■ Florida-based private property insurers will go bankrupt. ■ The national carriers will continue to avoid Florida. ■ Taxpayer-owned Citizens

Property Insurance Corp. will be the only source of property insurance, making every Florida taxpayer liable to cover billions of dollars of losses in the event of a major hurricane. ■ There will be no such thing as affordable housing, as insurance rates drive up the cost of housing. ■ Millions of Florida’s senior citizens will be unable to afford to stay in their homes. “100% correct,” said Sen. Boyd, who has spent his professional life owning an insurance agency in Bradenton. “There’ll be tsunami effects on real estate, banking, mortgage lenders.” The tsunami has already started, according to Guy Fraker, a corporate strategist who spent six months in 2020 researching the condition of Florida’s property and casualty insurance market. “Florida’s P&C market is in a free-fall collapse,” Fraker told us. “This market is going to fail.” “It’s going to be a nightmare,” said Gregory Holder, a recently retired circuit judge in Hillsborough County, who presided over thousands of insurance cases in his 26 years on the bench. “The sky is falling. It is a financial crisis for the citizens of this great state. Everyone is affected by this.” Barry Gilway, CEO of state-owned Citizens Property Insurance Corp., is not as dire. “Something has to give,” he said. He agrees current conditions are unsustainable. “Absolutely,” he said. Collapse? Free-fall? Unsustainable? Nightmare? Hyperbole? If you’re a property owner, you’re seeing it. Your property insurance rates for 2021 have risen 20% to 50% over 2020. “My rate on my house went up 40%,” Boyd said. Michael Mailliard, owner of Longboat Key-based MIC Insurance, told us 25% of his clients have been unable to renew their existing policies

2020 property lawsuits in Florida All insurance companies: 85,007 lawsuits

Number served Zero count counties are white 1-100

45%

101-500

Cases are in Palm Beach, Broward, and Miami-Dade counties

501-1,000 1,001 -2,000 2,001 - 5,000 5,001 -10,000 More than 10,000

and have hit sticker shock when Mailliard informs them of their higher-priced options. For thousands upon thousands of Florida homeowners, however, the only option is Citizens, the state’s insurer of last resort. Citizens has been taking on 4,000 new policies a week since June 2020. Gilway doesn’t see that stopping. After shrinking its policyholders down to 420,000 in 2018, it now expects that number to reach 700,000 by the end of 2021. Here’s the risk to that: As the state-owned insurer, Citizens has the legal authority to

assess all Florida citizens if it runs out of money. The more policyholders Citizens has, the higher the risk for all Floridians. All of this is not because of the risk of hurricanes. It’s because of insurance-claim lawsuits. In particular, to be precise, this insurance crisis is a result of the tsunami of lawsuits against insurers (primarily roof related) that has washed over the state in the wake of Hurricane Irma, the 2017 Cat 5 storm that washed out much of the Keys. Take in these statistics: ■ Total damage-claim insur-

ance lawsuits filed in Florida: 2013: 27,416 2014: 31,647 2015: 37,820 2016: 41,851 2017: 49,148 2018: 82,663 2019: 84,087 2020: 85,007 ■ Amounts paid out by insurance companies in Florida since 2013 to cover damages and legal fees related to these lawsuits: $15 billion. Now here’s the kicker: ■ Of that $15 billion, insurers paid out, 71% covered attorneys’ fees; 21% covered insurers’ defense fees; Only 8% went to property owners. Put another way: Trial

Losses mount for insurers Here is a ranking of Florida-based property insurers based on their combined ratio, a key measurement of the profitability of an insurer. The lower the ratio, the healthier the company. The combined ratio is a percentage of claims paid plus operating expenses divided by earned premiums. It’s a measurement of Company Amer Integrity Ins Co. of FL American Capital Assr Corp. American Coastal Ins Co. American Modern Ins American Platinum P&C Ins Co. American Strategic Ins Corp. American Traditions Anchor P&C Insurance Co.*** ASI Assurance Corp. ASI Preferred Insurance Corp. Auto Club Insurance Co. of FL Avatar Capacity Insurance Co. Capital Preferred Centauri Specialty Ins Co. Cypress P&C Insurance Co. Edison Insurance Co. Family Security Insurance Co. FedNat Insurance Co. First Community Insurance Co. First Protective Florida Family Florida Farm Bureau Cas Ins Co Florida Peninsula Insurance Co Gulfstream Ins Heritage P&C Insurance Co.

whether an insurer is operating its business efficiently and profitably. The ratio does not include investment income. A ratio below 100% indicates the company is making an underwriting profit, while a ratio above 100% means it is paying out more money in claims than it is receiving from premiums.

Combined Ratios 2019-20 2016-20 2019 2020 % Chg. % Chg. 99.2 102.0 3% 10.1% 114.4 NA NA NA 103.6 122.0 18% 76.8% 101.3 110.0 9% 6.1% 79.9 84.6 6% -1.8% 103.5 108.3 5% 12.6% 95.5 106.5 12% 0.5% 219.0 387.5 77% 172.5% 63.9 108.3 70% 30.0% 167.4 129.3 -23% 22.9% 94.0 119.1 27% 34.5% 118.2 264.5 124% 183.4% 108.0 150.7 40% 57.8% 138.3 NA NA NA 115.8 274.4 137% 151.1% 118.8 111.7 -6% -22.4% 112.0 122.6 9% 54.1% 109.9 124.9 14% 29.6% 109.6 145.1 32% 27.2% 101.4 120.1 18% 12.9% 125.5 87.5 -30% -61.3% 107.5 114.4 6% 16.8% 105.1 116.6 11% 5.7% 118.9 128.2 8% 21.3% 125.5 282.3 125% 150.5% 111.5 117.6 6% -0.4%

Source: Florida Office of Insurance Regulation

When Guy Fraker, a business strategist hired by the Florida Senate to study the health of the state’s property insurers, looks at the 2020 combined ratio of Florida insurers — 162%, he says: “How can you have an industry whose annual expense load is 62% higher than breakeven and is growing 30% a year?”

Company Homeowners Choice Maison Ins Monarch National Insurance Co. Omega Insurance Co. People’s Trust Insurance Co. Privilege Underwriters Recpl Progressive Property Ins Co. Safe Harbor Insurance Co. Safepoint Insurance Co. Security First Insurance Co. Southern Fidelity Southern Oak St. Johns Insurance Co. Tower Hill Pref Tower Hill Prime Insurance Co. Tower Hill Select Insurance Co Tower Hill Signature Ins Co.**** TypTap United P&C Insurance Co. Univ Ins Co. of North America Universal P&C Insurance Co. US Coastal P&C Insurance Co. Weston Insurance Co. Florida Based Ins.* N=49 Florida Total

Combined Ratios 2019-20 2016-20 2019 2020 % Chg. % Chg. 96.8 108.6 12% 11.6% 168.8 143.2 -15% 35.7% 169.7 160.4 -5% 82.9% 122.5 NA NA 11.6% 111.5 130.4 17% -8.1% 121.0 118.9 -2% 18.9% 107.0 108.3 1% 4.9% 102.7 115.8 13% 22.4% 137.8 108.6 -21% -13.1% 181.0 277.0 53% 118.3% 122.9 NA NA -20.7% 121.2 118.4 -2% 24.0% 178.7 683.2 282% 444.0% 114.9 148.1 29% 54.5% 101.7 157.4 55% 30.7% 123.4 NA NA 10.6% 96.3 181.6 89% 61.4% 86.8 114.0 31% 16.9% 112.7 125.1 11% 17.7% 118.1 NA NA 6.3% 108.6 120.3 11% 38.3% 98.3 139.1 41% 39.7% 86.4 392.5 354% -4.8% 117.5 162.5 38% 42.4% 94.9 110.1 0.1 -14.1%

* Does not include Citizens Property Insurance

JACKSONVILLE DAILY RECORD / JACKSONVILLE RECORD & OBSERVER

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lawyers took in $10.65 billion, while Florida citizens whose properties were damaged were paid only $1.2 billion. Or, to bring that differential into a more digestible comparison, Fraker’s report shows a lawsuit in which Security First Insurance Co. was ordered to pay a damage award of $142 to a homeowner and $31,140 in legal fees to the consumer’s lawyer — 21,041% more than the awarded damages. Disparities like the one above are common. Fraker’s report shows another suit in which the insured received $41,000 in damages, while the attorney representing him received $1.2 million. Another one: $35,000 to the homeowner; $712,677 to the attorneys. The list of these goes on and on. Boyd told a Senate Committee of one attorney who filed 1,234 lawsuits against insurers in three months. “That’s 13.4 a day,” he said. Holder told the Senate Judiciary Committee earlier this month that the 13th Judicial Circuit “has several thousand of these cases with well over 500 cases filed by one law firm.” Holder experienced cases he described as follows: “On June 6, an attorney would file suit on a claim for a leak in the kitchen. On June 20, he’d file for a leak in the bedroom. And on July 4, he’d file one for a leak in the bathroom. All from the same policy. Later on, another law firm would file three lawsuits for the assignment of benefits to the contractors, all for the same leaks.” Altogether, this one home and policy would account for

About SB 76 The guts of the bill would: ■ Award attorneys’ fees in line with the value of settlements, still allowing for higher amounts in rare and exceptional cases; ■ Require policyholders to provide a pre-lawsuit notice to the insurer that clearly sets forth the amount demanded and the basis of the dispute and give the insurer a specified time to inspect the property prior to a lawsuit being filed; ■ Reduce from three years and five years to two years the deadline to file property insurance claims; and ■ Allow property insurers to offer policies of actual cash value roof coverage for roofs older than 10 years rather than total roof replacement, except in the case of a total loss.

six lawsuits. “Upon discovering this clearly unethical and arguably illegal conduct,” Holder wrote in a letter to Sen. Jeff Brandes, chair of the Senate Judiciary Committee, “I conducted my own research compiling a list of more than 1,000 cases filed by just four attorneys in two separate firms …” This onslaught of lawsuits has brought on the financial crisis that is about to blow up Florida’s property and casualty insurance industry and the

companies that underwrite the insurance behind Florida’s 6.5 million properties. After three profitable years from 2013 through 2015, Florida-based insurance companies have reported five consecutive years of underwriting and operating losses. Last year, underwriting losses for all property insurers in Florida — what they paid out in claims after premiums — increased 138% to $1.584 billion compared with $664 million in 2019. Net losses — premium and investment income minus all expenses — mushroomed from $362 million to $747 million, up 106%. These losses have occurred even in the face of the state Office of Insurance Regulation approving rate increases of 10%, 14%, 20%, 25% and 52% over the past five years. Fraker said he had his “aha! moment” about Florida’s insurance market after interviewing two C-suite executives of global reinsurance companies. One referred to Florida as “the highest risk zone in the world.” Another told him: “Hurricanes are not the biggest systemic threat. The lawsuits represent such a high degree of uncertainty, we don’t know how to model Florida.” Gilway of Citizens, who has spent nearly 50 years in the industry, including as CEO of Zurich Canada and executive vice president of Zurich North America, says there is no other insurance market in the U.S. close to Florida, and that is for two reasons: “The overall judiciary environment and the strength of the trial Bar.” Says Fraker: “People think this is the insurance companies

versus the lawyers. It’s actually the lawyers versus the consumers.” In his report to the state Senate, Fraker wrote: “Think of the litigation costs to insurers as ultimately a tax upon Florida’s property owners they don’t know exists.” In 2019 alone, Fraker wrote, the costs allocated to insurance lawsuits totaled $2 billion and $2.5 billion. He figured that every Florida family in 2020 paid a $651 annual hidden tax that no other state has — money that went “into a fund owned by fewer than 2,000 stakeholders [lawyers].” How did this happen? Gilway pegged it. The Florida trial Bar has manhandled the Legislature for decades, crafting and shepherding legislation into law that tilts the legal system and incentives in its favor. There are formulas for attorney fees and contingencies that allow multipliers to be applied, predictably resulting in higher legal costs and ultimately higher insurance premiums to consumers. Also driving the crisis are thousands of lawsuits related to roof replacements. Contractors go door-to-door through neighborhoods urging homeowners to let them inspect their roofs, hoping to parlay the tiniest leak into a total roof replacement at the expense of the insurer. Many of these contractors leave leaflets on homeowners’ doors offering $500 bonuses for referring friends. To address the crisis, Brandes convinced Senate President Wilton Simpson at the end of the 2019 legislative session of the urgency for

THURSDAY, MARCH 25, 2021

reforms — even if it means taking on the trial Bar. Brandes, Boyd and Senate Insurance Committee staffers collaborated to craft SB 76 (see box). Predictably, the trial Bar, including senators and House members who are trial lawyers, are fighting to stop key provisions, especially one that would align attorney fees with damages and another that would reduce to two years from three the time homeowners can file a claim. Fraker, who is neither an insurer nor an attorney, said Boyd’s bill would be a major fix to the litigation issue and bring stability to the market. Gilway said it would be a good start. The two of them, along with Boyd and Brandes, say if it doesn’t pass there will be nothing to stop the runaway litigation. “Something has to give,” Gilway said. Their fear: the trial Bar’s grip on the House. Senate Bill 76 was expected to have its last committee hearing March 25 before going to the Senate floor. By contrast, a similar but less comprehensive insurance bill in the House, HB 305, only won its first of three committee approvals March 23. A telltale sign of a bill’s ultimate fate is the speed at which it moves through committees. If either of the next two House committees balks at hearing HB 305, we’ll know who stopped it. MWALSH@ JAXDAILYRECORD.COM (904) 356-2466