In a pivotal 14-2 vote on March 25, the Jacksonville City Council approved Ordinance 2025-0135, authorizing up to $8 million for the potential purchase of the Interline Brands Inc. building at 801 W. Bay St. The decision opens a new chapter in the city’s ongoing efforts to secure property for the planned University of Florida graduate center in LaVilla—set to begin classes as soon as August 2025.

But behind the scenes, the deal is raising more than just hopes. It's prompting serious questions about transparency, potential conflicts of interest, and the financial footing of one of Downtown Jacksonville’s most aggressive developers: Gateway Jax.

The Deal: Purchase vs. Swap

The ordinance was initially slated to offer $4 million for a proposed land swap with Gateway Jax. That deal would see the Interline property traded for a parcel of land at Riverfront Plaza—the former Jacksonville Landing site. But after deliberations, Council amended the ordinance to allow up to $8 million in cash, citing Gateway’s appraisal valuing the property at exactly that amount.

However, a DIA-commissioned appraisal valued the property lower, at $5.5 million (not including the parcel's developable land), prompting calls for a third-party appraisal, now due March 27.

Councilman Ron Salem, who introduced the ordinance, supported an outright purchase, calling it cleaner and potentially less costly in the long run. Councilmember Will Lahnen echoed the concern, arguing that the swap could open the door to future incentive requests from Gateway—particularly as their proposal for a 17-story mixed-use tower on the Riverfront site is expected to seek at least $20 million in public subsidies.

The land swap option remains technically on the table, with DIA CEO Lori Boyer assuring Council that this vote preserves both routes. Still, the financial and political implications surrounding the project run deeper than what’s on the official record.

The $4M Question: Did Gateway Jax Get a Heads Up?

Gateway Jax acquired the Interline building in October 2024—just weeks before UF’s plans for a downtown graduate campus were publicly announced. That timing, coupled with Mayor Donna Deegan and DIA’s subsequent push to include the property in UF negotiations, has sparked allegations that Gateway Jax may have received inside information.

A still-unanswered public records request filed months ago by watchdogs seeks any communications between the Mayor’s office, DIA, and Gateway Jax (including DLP Capital and associated LLCs) between January 2024 and February 2025. The request aims to determine whether Gateway was tipped off about the Interline building’s potential inclusion in the UF deal—before the public or other developers had any idea.

Despite the lack of documentation (so far), Gateway Jax has been granted exclusive rights to negotiate on this deal by DIA CEO Boyer. Critics argue that these negotiations fall under Florida’s Government in the Sunshine laws and should be fully transparent.

A Pattern of Overreach? Concerns Over Gateway Jax's Portfolio

While Gateway Jax is positioning itself as a central player in the revitalization of Downtown Jacksonville, some question whether the firm is overextending itself financially.

Through entities like 420 Julia St. LLC, Gateway recently purchased several blighted downtown properties—including the Ambassador Hotel and Central National Bank buildings—for a combined $17 million. That deal came on the heels of legal and financial woes for Augustine Development, the former owners, who were being sued by DLP Capital—the very same financier now backing Gateway Jax.

This has raised eyebrows. Was this a distressed asset fire sale dressed up as strategic redevelopment? And more importantly, does Gateway Jax have the liquidity to handle the scale of its commitments without massive public subsidies?

These acquisitions are part of nearly 30 acres of downtown property Gateway now controls, thanks in part to tens of millions in taxpayer-backed incentives. While progress is welcomed, there's growing concern that the city is underwriting too much risk without enough transparency or financial guardrails.

Bigger Picture: A Billion-Dollar Domino Effect?

The Interline purchase—and by extension, the UF graduate campus—could set off a domino effect with staggering financial implications. Plans include razing the Prime F. Osborn III Convention Center to make way for new UF construction and relocating the convention center to the Duval County jail site, which would then need to be replaced by a new jail at Montgomery Correctional Center.

Combined costs for these projects could exceed $2 billion—a heavy lift for a city already facing projected deficits of $40–$100 million annually for the next four years. And all of it hinges on a deal that started with an $8 million vote for a building Gateway bought for half that just months ago.

This begs the question: was LaVilla really the only viable option for the UF campus in all of Duval County, the largest city by land mass in the U.S.? Or was it chosen precisely to force the city’s hand in a broader and more costly redevelopment agenda?

Transparency Matters

Jacksonville deserves revitalization, and the arrival of a major UF campus is a huge win. But deals like the Interline acquisition must be held to the highest standards of transparency and financial scrutiny—especially when they ripple into billion-dollar public obligations.

City Council's vote has kept options open, but it's also opened a floodgate of questions. As we await the third appraisal, the response to outstanding FOIA requests, and Gateway Jax’s next move, one thing is clear: the people of Jacksonville deserve to know whether they’re investing in revitalization—or just refinancing someone else’s risk.