On January 16, 2026, I received an unsolicited email from Mayor Singer regarding the downtown campus project that in his words “will result in more than $4 billion in revenues”. There are several key pieces of information that were missing from the Mayor’s update that make it misleading to residents not closely following this project.
The time horizon of the project is 99 years. By omitting the time horizon of the project, residents may incorrectly assume that they will see the results during their lifetime when in fact a majority of the net revenue is projected to be realized after 30 years.
A closer look
Revenues of the proposed project are divided between ad valorem tax, CRA revenue, and rental income. While $4 billion sounds like a great investment, ad valorem and CRA revenues are subject to service costs of the City. That’s what pays for things the project requires such as infrastructure, police, fire, maintenance, and other public services. By not removing those costs residents are being given an unrealistic presentation of the project revenues.
Additionally, the portion of the $4 billion estimate that is rental income is determined using “percentage rent metric”. That is a performance-based measure which would allow the City to participate in the upside of commercial success. The City’s portion of the rent is challenging to predict. So by using gross revenues in the $4 billion claim, the risks attributable to the actual realization are not being realistically represented to the public.
What it actually is
A more honest statement, based on the City consultant’s report, would be that the project is projected to provide approximately $330-$415 million by 2056 (year 30). This is the actual un-discounted net revenues of $2.5 billion over 99 years of which only 8-10% will be realized by year 30.
Considering the time value of money ($1 today is worth more than $1 received 99 years from today), the latest consultant report for the City projected the Net Present Value (NPV) of the revenues to be $176 million using a 5% discount rate (see note below). Considering that the upfront costs for redeveloping the public components are projected to be $200 million, which exceeds the projected NPV, the cost to the City for what it wants to do is $24 million over the value of its projected returns over the course of the 99 year lease.
One Boca advertising is piling on
The timing of the cash flows on the project are also an important consideration. This is because the estimated $200 million in costs to the City for what it wants to do on the public portion of the project will be incurred now, not in 30 or 99 years. To cover the funding gap, the City will need to issue another municipal bond projected at $127 million (in addition to the $175 million to move the police station out of the way). The revenues generated by the project will be further reduced with financing costs related to the bonds.
My bottom line
In the interest of transparency at a time of severe loss of public trust in the council, I think residents deserve factual information, not misleading marketing talking points. I think people want to make informed decisions without being manipulated.
NOTE: A discussion on the appropriateness of the discount rate used by the City’s consultants, is a discussion for another day, but I will just say that accounting standards require discount rates to be adjusted for risks. Using a lower rate, based on municipal financing rates, understates risk and biases the analysis.
