Jekyll Island, Ga., private developer scuttle deal for $100 million island makeover

Jekyll Island, Ga., partner developer part ways

SAVANNAH, Ga. — Jekyll Island is scrapping its partnership with a private developer chosen to oversee a $100 million makeover of the state park, officials said Tuesday, blaming the sour economy.

The announcement that Linger Longer Communities, the Atlanta-based developer chosen for the project in 2007, was out of the deal to build and manage new hotels, condominiums and retail shops on the state-owned island came a day after Gov. Sonny Perdue helped break ground on its first major project — a new 20-acre beachfront park funded by the state.

The Jekyll Island Authority, which manages the state-owned island, will move ahead with $50 million in state-funded construction projects, including a new convention center scheduled for completion by 2012, said spokesman Eric Garvey.

Garvey said officials believe the new construction will help attract developers, likely different companies taking individual pieces of the 48-acre redevelopment.

“While unexpected and perhaps unfortunate, this does not mean in any way that the project is dead,” Garvey said. “We are very optimistic that we can keep things moving ahead.”

The decision to pull the plug on their contract was a mutual one between the authority and Linger Longer, Garvey said.

Both parties blamed the tight credit market for making made it too difficult for the developer to get financing for its portion of the project.

“Our decision to release the authority from its commitment to us was due to the uncertainty of the economic environment and the difficulty that this uncertainty imposes on a workable development schedule,” said Mercer Reynolds, chairman of Linger Longer’s parent, The Reynolds Companies.

Jekyll Island officials selected Linger Longer two years ago to help turn around a slump in tourism and convention business. While once a getaway for America’s wealthiest industrialists, the island’s aging, musty hotels and outdated meeting halls were blamed for tourism falling from a peak of 2.1 million visitors a decade ago to 1.49 million last year.

Plans to revitalize Jekyll Island, about 60 miles south of Savannah, ran into controversy almost immediately.

Critics blasted initial plans for $352 million in new construction, including 277 condominiums and an upscale hotel, as too ritzy for a state park that is required, by a 1950 state law, to be accessible to Georgians of “average income.” As the economic crisis deepened, the masterplan for new construction was slashed by more than two-thirds in October 2008.

Still, critics such as David Egan, an island resident who heads the Initiative to Protect Jekyll Island, continued to rail against the deal with Linger Longer, which was to get a 25-year contract to manage the new developments. Egan and others said the contract gave too hefty a share of the profits to a private developer building on state land.

“For us, this just didn’t make economic sense. It seemed like a one-way street,” said Egan, who applauded the deal’s demise. “I see this as the state having gotten rid of a millstone around its neck.”

Garvey said Jekyll Island plans to stick with the overall blueprint it had with Linger Longer to build a new town center on the island with more than 1,100 hotel, condo and time-share units along 64 acres of beachfront property. But those projects will now likely be broken into smaller contracts with several different developers.

The need for a new convention hotel and other amenities to open by the time Jekyll’s new 141,000-square-foot convention center is finished, or soon thereafter, played a key role in Linger Longer’s exit, Garvey said.

Linger Longer had sought to amend its contract with the Jekyll authority to give the developer a two-year delay in beginning construction. The developer was initially supposed to break ground next month.

“Timing is a vital component of our planning,” Garvey said. “With the uncertainty of the economy, Linger Longer was unable to agree to the same timeframe the Jekyll Island Authority needed.”

Bert Brantley, the governor’s spokesman, said Perdue was confident the authority had done what’s best for Jekyll Island and the state.

“Whether it’s done through one masterplan arrangement or it’s broke up, the main thing is we’re hopefully going to be able to reintroduce a beautiful island, one that’s a treasure for Georgia.”