The city of Gainesville signaled that it will regain ownership of Lot 10 after the developer failed to start construction within four years of the original purchase.  

However, the Gainesville City Commission may lease the property back to the developer, AMJ Group, in order to still build a multistory residential and commercial building on the site in the heart of downtown.  

On Thursday, the city commissioners voted unanimously to start negotiations on a complex plan to keep the project alive. 

Gainesville has tried to build on the empty lot for over 20 years, with multiple failed attempts across different developers. The lot sits just southwest of the intersection of SW First Avenue and SW First Street and diagonal from the Southwest Downtown Parking Garage.

Anthony Lyons, vice president with AMJ Group, said the company has gotten further than the previous developers, but changes in financing pushed back start deadlines. After an extension in December 2024, city commissions said they’d hesitate to approve another delay.  

Along with general interest rate increases, the development was also hit by Gainesville’s decision to opt out of Florida’s Live Local Act tax exemptions for qualifying residential properties.  

Gainesville staff and AMJ Group have met regularly since December to find a solution. And a complicated financial path exists to keep the project alive, the two said.  

Andrew Persons, Gainesville’s chief operating officer, presented the overall plan and said staff want to know if the City Commission would be interested. If so, negotiations with AMJ Group could begin and a fully calculated blueprint could be formed. If not, Persons said the city and AMJ Group could both walk away, with the city keeping ownership of the property and paying back the 2021 purchase price.  

Mayor Harvey Ward said he’s been around for the previous attempts and wants to see the project happen. 

“The longer it takes, not only is that more time that nobody’s living downtown, it’s also time that construction becomes more expensive,” Ward said. “I mean, the longer we delay, the harder it is for it to get done.” 

Under the plan, Gainesville would purchase the property from AMJ Group for $100 and then lease it back to the company for a 30-year term. This arrangement would allow the project to take advantage of a new state law that provides tax exemptions for affordable housing on government-owned properties.  

This new law requires the development to happen on government-owned land, a minimum of 70 units and a 30-year term.  

If built, all the affordable units, defined by state statutes and aimed at persons earning 120% of the area median income or below, would be exempt from local taxes.  

Those savings help the project pencil out for AMJ Group and could keep the rents lower. 

Persons said AMJ Group also wants assistance from Gainesville’s ConnectFree program, funds set aside to help developments of affordable housing to pay for water and wastewater connections. He said the city has $1.2 million in remaining program funding, and AMJ Group wants around $1.7 million.  

Another component of the project, Gainesville would purchase a number of the finished units to rent out. The city could then subsidize the units to any level of affordability. The city has $1 million set aside from the money AMJ Group paid for the property, and Persons said the city could use that money plus infrastructure surtax dollars.  

The surtax dollars would come from the one-cent sales tax that voters approved in 2022. Of the surtax revenue, half is set aside for the Wild Spaces Public Places program and the other half is for the newly branded Streets, Stations and Strong Foundations (SSSF) program.  

The city voted to set aside 10% of the SSSF funds, or 5% of the entire one-cent surtax, to affordable housing projects. Persons said the fund has over $2 million that has yet to be spent.  

Lyons said AMJ Group plans to build around 126 units, less than the original plan. He said the goal is to lower the building height in order to leave the “high-rise” category that brings larger construction costs.  

The new plan anticipates a seven- or eight-story building with commercial spaces on the ground floor.  

Lyons said the building will be a solid concrete and steel structure. It’s not a cheap building, and he said the company doesn’t want to cheapen it, though he said it could be built for less.  

Nearly all of the costs and figures could change as Gainesville staff negotiate with AMJ Group to move forward. All negotiations would need to be returned to the City Commission for approval, and the project still isn’t set in stone.  

But Persons said if everything runs smoothly, construction could begin in June 2026.