City Council agrees to explore idea for downtown stop
By Mary Hladky
Many South Florida cities want a Virgin Trains station, but now it looks like Boca Raton will walk away with the prize if an agreement can be reached between the city and the for-profit rail service.
Virgin Trains, formerly known as Brightline, notified the city in a July 19 letter that it wants to locate a station in the city — the first city stop to be added since it built the Miami, Fort Lauderdale and West Palm Beach stations.
Three days later, a company official made a pitch to City Council members, who quickly agreed to explore the idea.
“It is an extremely exciting opportunity for us,” said council member Andy Thomson. “We have to make sure it is done correctly.”
Two of the city’s largest employers — Florida Atlantic University and the Boca Raton Resort & Club — leaped on board.
“It is just so exciting. I am sure you can hear it in my voice,” said former Deputy Mayor Constance Scott, who now serves as FAU’s director of local relations.
“This is the best thing that could happen to Boca Raton,” she said, noting that 10,000 students commute from Broward County to the Boca Raton-based university each day when classes are in full swing.
Many other speakers also extolled what they see as the positive impacts of a station — an inducement to lure more corporations to set up headquarters in the city, a rise in property values, an alternative to clogged Interstate 95 and a way to draw visitors to the city’s cultural venues.
The only significant opposition came mostly from residents of the Library Commons neighborhood immediately north of the proposed station next to the Downtown Library. They complained of train horns even though quiet zones have been established, the potential of falling property values if Virgin Trains abandons the station and questioned why the city would give away land to multimillionaires backing Virgin Trains.
“I caution you to please go slow,” said one Library Commons resident. “What we have here is a nice residential community … that needs to be protected.”
Virgin Trains wants to move quickly, with the station in operation by the end of 2020.
Mayor Scott Singer, who got the ball rolling by contacting Virgin Trains officials earlier this year, said the city would move quickly to make a decision. But he anticipated it would take at least four to six months to finalize a mutually acceptable agreement and for the City Council to vote on it.
Singer sees the station as a potentially huge opportunity for the city. “History is replete with cities that got left behind because they did not have transportation connectivity,” he said.
Deputy City Manager George Brown said the project would require amendments to the city’s comprehensive plan, creation of new zoning regulations and a development agreement.
With the City Council’s blessing, city staff and Virgin Trains now will begin negotiations.
Virgin Trains is proposing to build and pay for the station along the Florida East Coast Railway tracks on city-owned land where the Downtown Library, its parking lot and Community Garden now sit at 400 NW Second Ave., three blocks northeast of City Hall.
It pledged to help find a new home for the Community Garden, established by the Junior League of Boca Raton, and Singer suggested several city-owned locations.
Virgin Trains is asking the city to contribute that land and another vacant city-owned parcel directly south of the library, bringing the total amount of land it wants to about 8 acres.
The city would pay for and build a parking garage, and Virgin Trains would manage its construction.
The city would agree to fund and build an elevated pedestrian bridge over Dixie Highway so that people can walk from the station across the busy roadway and into the downtown.
Virgin Trains also wants the city to provide shuttle service from the station to various locations in the city.
While the terms seem like a big request of the city, several dovetail with what council members have previously proposed.
They have long voiced the need for a downtown parking garage. With no downtown property owners willing to sell land to the city, council members are considering building one in the proposed downtown government campus.
They also want a trolley or electric car on-demand system to transport people around the downtown and have discussed a walkway across Dixie Highway as a convenience for people who would park in the garage.
The 6-year-old Downtown Library would remain at its current location but would lose most of its parking lot.
Virgin Trains would replace that parking with spaces on the ground floor of the garage that would be reserved free-of-charge for library patrons. Virgin Trains passengers would park on the upper floors.
The station and parking garage would be located on the library parking lot and Community Garden land.
But Virgin Trains also wants to develop portions of the city-owned land.
Brian Kronberg, Virgin Trains’ vice president of development, told the City Council that while plans aren’t finalized, he envisions ground-floor retail businesses with apartments above them, and co-working offices.
He did not offer more specifics or specify ticket prices and did not answer questions after his presentation.
Looking to buy land
But the company is eyeing privately owned land along Northwest Third and Fourth streets and Northwest First Avenue, located due east of the south portion of city-owned land Virgin Trains wants.
Mike Massarella, one of the owners of Boca Color Graphics on Third Street, said Virgin Trains offered to buy his property in July. Without divulging a price, he said it was a “fair and lucrative offer” but one he will not accept.
“We told them it wasn’t enough,” he said. “We can’t afford to move for what they are offering to pay us” because he cannot replace his building elsewhere in Boca for that amount.
Other business owners in the area also have been contacted, Massarella said, but he was not aware that any of them has agreed to sell as of late July.
He is awaiting a counteroffer. “I don’t expect I have heard the last of it,” he said.
Another nearby business owner, who asked that his name not be used, said he was contacted about one month ago. His lawyer is now reviewing a 40-page contract.
He said Virgin Trains is offering about 30 percent more than his property is worth. But he has not agreed to anything as he awaits word from his lawyer. He also wants to get a substantial down payment and a definite date on when the sale would take place.
While operating as Brightline, the company developed land near its stations in Miami, Fort Lauderdale and West Palm Beach to increase revenue. It’s a real estate play similar to that made by rail magnate Henry Flagler, who built hotels such as The Breakers in Palm Beach near his FEC tracks.
The MiamiCentral 11-acre project encompasses 1.6 million square feet, including two office towers, two apartment towers and stores and restaurants.
The West Palm Beach project includes Park-Line Palm Beaches, a 24-story, 290-unit apartment tower and retail space.
In Fort Lauderdale, Brightline owns about 8 acres near the train station and proposed a 14-story office tower last year.
The Virgin Group, headed by British billionaire Richard Branson, announced in November a partnership with Brightline that included putting the Virgin name on the trains. Virgin Group owns less than 2 percent of the rail company, according to regulatory filings.
Brightline long rejected pleas from cities along its tracks to add stations, saying that would increase passengers’ travel time.
But that stance changed this year as Virgin Trains started scouting for new locations.
Hollywood officials met with Virgin Trains officials recently, and Palm Beach Gardens Mayor Mark Marciano asked for a station as well.
Earlier this year, Virgin Trains said it was looking at Fort Lauderdale-Hollywood International Airport and PortMiami.
In a recent monthly report to bondholders, Virgin Trains said it would add stops at PortMiami, Aventura and Boca Raton, The Palm Beach Post reported.
Whether that is the final word on station additions is unclear. In his meeting with Boca Raton council members, Kronberg only said that the company is committed to building an additional station on the Treasure Coast.
In its letter to the city, Virgin Trains said it is “evaluating other south Florida cities to expand our service.”
Michael Hicks, director of media relations, declined comment before the letter was sent, saying “we aren’t getting into details about additional locations at the moment.”
Also unclear is how viable the train service is. Through the first half of 2019, Virgin Trains reported ridership of 481,320 and revenue of $11 million. In a document issued to bond investors in late 2017, Virgin Trains predicted its 2019 ridership in South Florida would top 2.3 million, while revenue would exceed $112 million, the Post has reported.
But Virgin Trains continues to expand. It announced in May it has started construction of long-awaited tracks between West Palm Beach and Orlando International Airport. It expects to start service in 2022.
The company also has announced plans to develop service between Orlando’s airport and Tampa, with a station at Walt Disney World.
All Aboard Florida, which operates Brightline, is owned by an affiliate of Fortress Investment Group LLC, a global investment management firm.