Submitted by Suanne Z. Thamm
Reporter – News Analyst
October 6, 2021
On a 4-1 vote the Fernandina Beach City Commission (FBCC) voted to deny Resolution 2021-168 to approve a new lease agreement with Anne T. Coonrod d/b/a Atlantic Seafood Bait and Tackle. The City’s ongoing work to construct resiliency barriers and a boardwalk requires the demolition of the Atlantic Seafood building. The City has worked with Coonrod and her team over recent months to find a new location which would allow her to build a replacement building. However, the FBCC is unwilling to allow Coonrod to build a new building over 1200 square feet — the size of the building destined for demolition. Coonrod, who originally sought a new area of more than 9,000 square feet, reduced her requirement to 6,500 square feet.
Talks have apparently stalemated. Coonrod has stated that in order to cover the costs of a new building, she needs to add food service and extend the lease, which expires is 2028. She is seeking a new 40-year lease with two ten-year renewal options. Commissioners believe that under the terms of the current lease, she cannot expand the footprint beyond the 1200 square feet that she currently leases. There is general consensus among Commissioners that if the City is interested in adding or expanding a structure on the downtown waterfront, it should issue a Request for Proposals (RFP) to allow all interested parties to offer proposals. Such action would avoid concerns that the City was giving Atlantic Seafood a “sweetheart deal.”
The only Commissioner to disagree with the RFP approach was Bradley Bean, who cited the longevity of Atlantic Seafood — more than 40 years in its current location. He said that Coonrod has been a good partner for the City and saw no need to widen the search for a possible replacement.
Commissioner Bradley Bean moved approval of the new lease, but a second to his motion was not forthcoming. Finally Commissioner Chip Ross agreed to second for discussion purposes only.
Anne Coonrod addressed the FBCC, thanking them for their constructive feedback during talks. She explained that as a result, she had reduced her space need from 9,200 to 6,500 square feet. The building would adhere to CRA design guidelines. She would agree to new appraisals every 10 years to adjust the rent. “We are committed to best practices for public/private land use,” she said, “and it would blend seamlessly with the marina. Our hope is that it will encourage more Fernandina Beach residents to use this special corner of our island.” She concluded by saying she was open to making “any adjustment that is viable.”
Addressing the FBCC, Coonrod said, “I ask each of you to work with me and honor the lease that I have with the City and to consider the taxpayers who would like to have something other than boating and parking on our historic waterfront.”
Three other speakers addressed the FBCC.
Mac Morris said, “99 percent of the people love Atlantic Seafood. They just don’t want a large building blocking their sunset view or taking away from parking.” He suggested moving Atlantic Seafood to the city-owned lot north of the marina.
Marian Phillips expressed her appreciation and respect for Anne Coonrod. But she also did not agree with a large building on the waterfront. She said she would like to see a new Atlantic Seafood building that looks exactly like the current one, harkening back to the working waterfront past of Fernandina Beach. “This is not Hilton Head,” she said. “Personally I am getting tired of people coming to this island and wanting to change it. We have got to slack off on some of this growth.”
Final speaker Genece Minshew said, “If we are going to put a bigger building on the waterfront, it needs to be part of a plan, and I still don’t see that plan. I also feel strongly that anything larger than the current building should go out for bid if we really are looking for a public/private partnership. There needs to be more transparency and it needs to be more clear to the public.”
Vice Mayor Len Kreger reminded Commissioners that he has been opposed to this proposal from the beginning. “In my mind, this is totally inappropriate,” he said. “This type of operating causes people to have a totally negative view of the City. What we should have done was go out on an RFP, to open it up to the public. In 6 years on the FBCC this is the worst deal I’ve seen of things going on behind closed doors.”
Commissioner David Sturges agreed with Kreger, while commending Coonrod as a good businesswoman who has contributed to the community. “If we want another restaurant on the waterfront, it needs to go out on an RFP,” he said. “I cannot vote to approve this lease tonight.”
Commissioner Bradley Bean asked Coonrod why a 1,200 square building would not meet her needs. She said, “It’s just too expensive to build a new building to accommodate the seafood business today. Seafood is like the grocery business, and the profit margins are narrow.”
Bean said, “Folks, this business has been here for 48 years. What has happened? She is operating fine, she has 6 more years on her lease. But we as a Commission have approved a boardwalk which is slated to run through her building. We are disrupting her business. It’s not that we are looking at a sweetheart deal. We are looking out for a current business owner and we are making sure there is a feasible option for her to continue.” Bean said that even in viewing RFP responses, he would look to see if the bidder was a current business owner in the area.
“Folks, I see a danger ahead of us: it’s Hooters or Gators Dockside or a chain restaurant that can bring in the most money,” Bean said. “We have an opportunity tonight to see a local business succeed and do well. I believe that Atlantic Seafood is the right deal for the City.”
Sturges asked City Manager Dale Martin what would happen if the FBCC failed to approve the lease. Martin said that the City had provided Coonrod with the required 180-day notice that the boardwalk is under construction. “We have the right to demolish the building at our cost, and she has the right to build a 1,200 square foot building at her cost,” Martin said. “She has the right to request more land under her existing lease. We have not yet given her a date by which time the building needs to come down.”
City Attorney Bach agreed with Martin, but also suggested that with 6 years left on her lease, Coonrod would need to decide if it was financially viable to build a new building for a business with low profit margins. She said that even if Coonrod had decided to press forward, the FBCC would need to decide where she could build a 1,200 square foot building. “We are going to need a lot more direction from the Commission,” she said.
Sturges said, “We don’t have all the answers. We have been putting Ms. Coonrod through her paces with designing a building, when we haven’t even decided what we want. The only thing we’ve decided on the waterfront is to proceed with resiliency construction, and unfortunately that affects her business. We need a consensus among Commissioners, and we don’t have it yet.”
Bean said, “I truly believe that a no vote tonight is going to kill Atlantic Seafood. Is there a level we are willing to accept and commit to?”
Mayor Mike Lednovich said the problems have been created by the Commission. The public has raised concerns over the size of the building and the length of the proposed lease. The future of the Atlantic Seafood Building was not included in waterfront plans. offered a possible solution: stop building the boardwalk for 6 years, the remaining length of the lease.
Commissioner Chip Ross said that the current lease, signed by both parties, was executed 13 years ago and included a specific paragraph on the future building of a boardwalk. Paraphrasing the contract, Ross said, “When the City builds a boardwalk, it will demolish the building and [the lessee] has a choice: build a new building of approximately the same size or your lease is terminated.”
Ross cited comments from City Engineer Charlie George who said that as the boardwalk construction continues north, the vibrations from the jackhammers will cause the existing building to fall apart. “How did that happen?” Ross asked. “You can’t even get insurance on the building because it’s in such poor condition. I don’t think [Atlantic Seafood] was a good steward of the building, I’m sorry. The parking in front of the store is not part of the lease. I think it’s not true that the City did not anticipate this. There is a lease agreement that was signed by both parties 13 years ago. To me, stopping the resiliency project is not an option. We’ve worked hard and long to do this, and I think we are going to have a magnificent riverwalk there, and I think an old building that is about to fall over is not something that needs to be preserved. I’m sorry that it impacts the business, but that was agreed to 13 years ago when the lease was signed.
Lednovich asked Ross, “So what’s the answer?”
Ross replied, “My answer is to follow the lease — 1,200 square feet. Otherwise, we part ways.” In response to a question from Lednovich, Ross recommended that following the vote, the City Manager and the City Attorney be charged to meet with Ms. Coonrod to see if there are other options that can come back to the FBCC at the next meeting.
Lednovich said that in his mind there are only two options: Coonrod builds a 1,200 square foot building or she walks away from the lease. City Attorney Bach said that at this time she cannot propose any additional options.
When the vote to extend the lease and increase square footage was taken, only Commissioner Bean supported it. The motion failed with four commissioners in opposition.
Alluded to during the discussion was “a third party” who has now entered discussions. That party was not identified, fueling speculation that should the lease be granted and extended, the current leaseholder will sell it to another party.