Sanford lets mixed-use housing developer walk away, drawing criticism

Sanford gave up a downtown waterfront project that could have delivered 234 apartments, 45,000 square feet of retail, restaurant and office space, and a new walkable neighborhood between First Street and Lake Monroe. Instead, city leaders paid $3.75 million to end the agreement with Sanford Waterfront Partners, leaving one of the city’s most visible housing sites without the homes, shops and offices it was supposed to produce.

The Heritage Park plan had been tied to three downtown blocks, about 5.25 acres the city designated as its Waterfront Catalyst Site. Officials once said the site could help strengthen downtown Sanford’s economy while adding homes in a location close to the RiverWalk, the courthouse, the civic center and the library. The project was meant to keep more residents living within walking distance of the waterfront and Main Street businesses, rather than pushing growth to the edge of town.

When financing for the project stalled, the developer proposed a new structure that would have set aside 20% of the residential units for very low-income renters in hopes of securing $75 million in tax-exempt bonds. City leaders did not accept that revised plan, saying it did not match the original deal. The disagreement exposed the larger tension at the heart of the project: Sanford wanted control over a carefully planned downtown neighborhood, while the developer needed a financing path that would make the project feasible.

Critics said the city missed a rare chance to answer Seminole County’s housing shortage with a large, mixed-income project in a prime location. Instead of adding apartments near jobs, transit, dining and the waterfront, Sanford spent years locked in a stalled arrangement that ended with taxpayer money going to end the deal. For residents who wanted more housing close to downtown, the loss was concrete: fewer homes, no new mixed-use tax base and another delay in filling a major gap in the city center.

Now commissioners are weighing what comes next for the parcels. Current ideas include a new mixed-use development with up to 30,000 square feet of retail and restaurant space on the ground floor, apartments above, a parking structure and a park closer to the waterfront. Another option is selling the properties outright, though city planners have warned that doing so would mean giving up control over what gets built on one of Sanford’s most important downtown sites.