Osceola County has sealed the deal with Korean tech billionaire Young-hwa Song to sell up to 70 acres in NeoCity for a future mixed-use town center that will combine luxury living with shops and restaurants and a new performing arts center on the lakefront.
County Manager Don Fisher signed the agreement Friday, then it was flown to South Korea for Song’s signature. Fisher told GrowthSpotter the final conveyance agreement does not have to go back to the Board of Commissioners for approval because they had already agreed to the preliminary terms in September.
Song’s DSUS Group LLC will pay $565,000 per acre for the first 25 acres, for a total of $14.125 million, and holds the exclusive negotiating rights for an additional 45 acres at a price to be determined later. There was one substantive change from the preliminary terms: the minimum investment required by the developer to fulfill his obligations was reduced from $1.2 billion to $900 million.
“That doesn’t mean they’re not going to invest $1.2 billion,” Fisher said, noting that the language was added to protect the developer in the case the project costs come in slightly below the initial amount. “That was just a matter of being cautious. I believe it will be more than that.”
The development program hasn’t changed. It calls for over 3.14 million square feet of new construction, with 55% slated for residential use and 45% for commercial. Components include 1,150 condominiums with nearly 400,000 square feet of amenities and common space as well as a 1.4 million-square-foot retail and entertainment hub situated along the lakefront in Neocity. There also would be 23,200 square feet of cafes and restaurants throughout the property, and potentially even an urban farm component.
The town center would include a commercial office tower, a dining and retail center with a movie theater, a 200-room conference hotel with about 100,000 square feet of convention/exhibition space and an entertainment hall with a 700-seat performing arts center.
“This is super exciting. This, to me, is what we needed because this is the western part of NeoCity,” Commissioner Cheryl Grieb said, noting that the semiconductor fabrication center, the office building and STEM school are on the east side of the tech district. “People need to have a place where they can envision living, shopping and dining. This will help complete the picture.”
Grieb had visited Song’s DS Semicon headquarters while on a trade mission to South Korea earlier this summer. “His building is located in a smart city square, and this is going to be a smart city. That was a plus for us,” she said.
With the conveyance agreement signed, the project moves into its next phase. DSUS Group will pay $100,000 deposit on the property within 15 days. By late January, the county will deliver the initial draft of the formal development agreement. Song will have 90 days from today to submit the final Phase 1 development program. Design documents and construction plans will be filed and approved in less than a year, and the actual closing would take place on Dec. 13, 2022. Construction of Phase 1 would start in early 2023.
“They’re excited to move forward as quickly as possible,” Fisher said. “He’s got a pretty robust timeline. I don’t know which of the multiple development components he plans to build first — that will be determined by the development agreement. But I do know it will have more than one component underway at the same time.”
The county, meanwhile, will put out a Request of Proposals for an architect to design the performing arts component of the city center, which also includes an outdoor plaza and amphitheater. Deputy County Manager Beth Knight will oversee those efforts.
Under the terms of the agreement, the county would retain $440,000 per acre of the purchase price to be placed in trust and spent on infrastructure improvements in the town center, such as landscaping and construction of an urban waterfront park. Any retained funds left in the trust after the completion of the urban waterfront would be shifted into the county’s general fund.
Fisher said the negotiations with Song have already had a spillover effect in the E192 corridor by establishing a new baseline value for properties around NeoCity. “We were looking to buy some additional parcels, and it immediately went from around $300,000 an acre to $565,000,” Fisher said.
Days after the town center plans were made public, Maury L. Carter & Associates send out an email blast promoting its newest listing for 12.2 acres on E192 at the NeoCity Way entrance to the district. President Daryl Carter said he used the county price as a comparable when pricing his site.
“They’re priced at $565,000 per acre,” Carter said. “So I would look at that and say I have 8 usable acres with direct frontage on U.S. 192 in front of NeoCity. So if a 25-acre internal site is worth $565,000 an acre, my site must be worth more. We absolutely think in those terms. People are excited about what’s happening in NeoCity, and it’s certainly driving phone and electronic traffic to our door.”
Kissimmee broker Rajia Ackley with Coldwell Banker also has a listing for 2.92 acres on E192, directly in front of the fabrication facility price at $1.295 million, or $443,493 per acre. She told GrowthSpotter she has an appraiser at the site Monday to provide an updated market report. Ackley’s listing is also right across E192 from a future hotel site at Osceola Heritage Park. It has Employment Center Perimeter zoning and lies within a federal opportunity zone.
The agreement between DSUS and the county marks an important milestone for NeoCity. “We’ve been waiting on this day,” Ackley said. “We’re all excited about NeoCity, and we love what’s coming to Osceola County.