VIRGINIA BEACH — The developer of a proposed oceanfront surf park has disputed key financial details about the project revealed in city documents from the Virginia Beach Development Authority this week.
On Tuesday, officials approved a resolution signaling the agency’s intention to hand over development and ownership of the planned surf lagoon to the nonprofit P3 Foundation LLC.
Surf Park is one aspect of the mixed-use Atlantic Park project on the former dome site between 18th and 20th streets.
The resolution, published on September 16, said the project’s developers had “encountered difficulties in finding a conventional funding mechanism” for the surfpark, thus threatening the success of the entire mixed-use project. He indicated to the authorities that there is a possibility that
Mike Culpepper, managing partner at Venture Realty Group, the project’s lead partner, said in an email Wednesday that the development group “has never attempted a conventional financing for a surf park. No,” he writes.
He also said that someone in his development group had indicated to authorities that the difficulty of securing conventional financing for surfparks could threaten the development of the multi-purpose project. I wrote, “I don’t know.”
Culpepper said earlier this week that the P3 Foundation developing a surfpark was a mistake, but declined to elaborate.
Meanwhile, the city released a statement on Friday, saying it understands the developer isn’t pursuing traditional funding for Surf Lagoon.
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“The developer advised us that traditional financing would be difficult to acquire for an unconventional asset like Surf Lagoon,” the statement said. “We will interpret the wording of the resolution as an expression of this understanding.”
The statement does not go into the details of the resolution on how mixed-use projects may be threatened.
As to whether developers read the resolution’s wording before Tuesday’s meeting, Culpeper declined to say, but said “many other people have reviewed this.”
He added that the development group’s plans to seek unconventional funding are not a new decision. The group chose Surfpark’s bond financing strategy more than two years ago to gain access to tax-free markets, which typically have lower interest rates than traditional financing, he wrote.
The resolution didn’t require city council approval, but city councilor John Moss said it was well known that developers struggled to find traditional funding mechanisms.
“It’s a common conversation and not a surprise to anyone,” Moss said.
Stacy Parker, 757-222-5125, [email protected]