The Real Deal Miami

New bidder emerges for contentious West Atlantic project in Delray Beach

Harold "Sonny" Van Arnem takes over for John Flynn, bidding to buy 6 acres of city land near downtown
By Keith Larsen | November 26, 2018 05:30PM

West Atlantic project in Delray Beach

A controversial developer who once tried to buy the stadium of the National Football League’s Detroit Lions has emerged as a new bidder in the contentious West Atlantic project in Delray Beach.

Harold “Sonny” Van Arnem is now one of six bidders seeking to purchase 6 acres at West Atlantic Avenue’s 600 to 800 block from the city, aiming to transform the downtown area into a bustling mixed-use project.

Van Arnem entered the bidding when he became the managing principal of Uptown Delray LLC, which was previously led by Irish developer John Flynn, according to a response filed to the Delray Beach Community Redevelopment Agency.

Van Arnem, a long-time South Florida resident who made his fortune with computer leasing companies, has sought to bid on a number professional sports complexes and teams throughout the past 40 years. He previously attempted to buy the Silverdome, the former home of the Detroit Lions, for $60 million before the city of Pontiac, Michigan, declined the offer, according to the Sun Sentinel. Van Arnem also once owned the rights to the Detroit Express, the city’s professional soccer team.

Based on previous legal documents and news articles, Van Arnem developed a reputation as an aggressive litigator who sued creditors over unpaid bills.

In 1994, he was awarded a contract to be a concert promoter for the Delray Beach Tennis Center, which became rife with controversy after it held only two concerts a year compared to four required by city commissioners, according to the Sun Sentinel.
For the West Atlantic project, his development group is looking to build 112 rental units, including 73 apartments and 39 townhomes.  About 20 percent of the proposed homes will be workforce housing. Plans also include 7,618 square feet of restaurants, 17,268 square feet of office space, and 40,265 square feet of commercial and retail space anchored by a full-service grocery store.Construction on the project would begin within six months of approval from the Delray Beach CRA. Uptown Delray has not publicly disclosed its financing for the project.

Van Arnem did not immediately respond to a request for comment.

Uptown Delray, under John Flynn, first made an offer of $1.2 million to buy the three blocks of land from the city in April. In July, the Delray Beach CRA’s board agreed to negotiate the sale to Flynn and he upped the offer to $2 million.

Residents complained and protests ensued over the proposed sale since a property appraisal had valued the land at $15.4 million, the Palm Beach Post reported. Delray Beach Mayor Shelly Petrolia pushed for the deal to go forward, but four of the seven CRA board members voted against the proposal, sending it back to a bidding contest.

Uptown Delray has now upped the offer to $4.1 million, according to a letter to the CRA.

The city has been trying to redevelop the area for about two decades. The property is also located in an Opportunity Zone, which means the developer can qualify for a major federal tax incentive for developing the project. If a developer holds the property for at least 10 years it can forgo paying any capital gains taxes on the investment.

Delray Beach’s CRA is now evaluating the proposals and is planning to make a recommendation on a bidder in January 2019, according to Executive Director Jeff Costello.