Naples Community Redevelopment Agency purchased a $4.9 million property last year for possible workforce housing for essential-services workers, but its fate is now uncertain — and some believe it should be sold to fund other needs.

The 0.58-acre parcel at 160-190 10th St. N. was the first the 30-year-old CRA purchased to develop it as workforce housing, parking or green space. After seeking proposals to develop it as workforce housing, the CRA decided to put it on the market to lease, prompting a three-year offer this month by a flooring company that wanted a showroom.

“I don’t think the CRA needs to be in the rental business,” said CRA Vice Chair Linda Penniman, adding it’s not appropriate. “My take on this would be that we sell it, take the money and do what needs to be done in the CRA [district].”

Meeting as the Community Redevelopment Agency on June 12, Council voted against leasing the property and instead directed its consultant, CBRE, to evaluate the site’s current value with and without the building. Council also asked for an analysis of potential short- and long-term uses — including the feasibility of adding underground stormwater improvements — and how those changes could affect nearby River Park East and River Park West, neighborhoods with historically Black roots that have since become more diverse.

They’ll discuss it again when they return from summer break Aug. 28.

“We very willingly, when we purchased this property, went along with that idea and thought it was a good idea at the time,” said CRA Chair Ray Christman. “That doesn’t mean that things don’t change, and we want to go in a different direction.”

They all agreed that if they eventually sold it, they didn’t want to sell for less than they paid, so it would be better to hold it.

The property is located near Central Avenue between U.S. 41 and Goodlette-Frank Road in the CRA District, which is bounded by Seventh Avenue North, Gordon River, Sixth Avenue South and Third Street South. The 8,960-square-foot building once housed an auto repair shop and vintage store.

The city hired CBRE in 2023 to explore options for the property. CBRE’s team, which includes Estero-based Trinity Commercial Group and Gridics in Miami, recommended a mixed-use concept: 3,600 square feet of commercial space and parking on the ground floor, with 26 affordable condos above, but that requires amending the city’s comprehensive plan.

Early this year, the CRA opted to hold off on a decision until it determined whether it wanted to get into a financing partnership to ensure the 95-unit Stillwater Cove remained affordable workforce housing. But that ended last month, when they voted against partnering with a nonprofit that would make improvements, manage it as workforce housing and then redevelop it.

Dan O’Berski, of Trinity, told the CRA that Stillwater Cove likely won’t remain affordable apartments once Corridor Ventures sells it.

Corridor Ventures also sold another affordable apartment complex, 104-unit Jade at Olde Naples, in March to real-estate investment firm Tidegate Capital for $21.25 million, property records show. Tidegate Capital said 50 units will be converted to condos, “offering potential buyers the most reasonably priced opportunity to be a homeowner in the city of Naples.”

Two other affordable apartment complexes totaling 142 subsidized units in River Park West remain in the city, 72-unit Jasmine Cay Apartments and 70-unit George Washington Carver Apartments, which has expressed interest in expanding.

There’s been a “softening in the market” since the CRA acquired the 10th Street property, O’Berski said, so the value likely has decreased, but that will be temporary, as it often is in Naples. If the city made stormwater improvements underground, he said, that would help the city and increase the value if the city decided to sell. He advised against razing the existing building.

City Manager Gary Young asked O’Berski to value the property with and without the buildings, and with stormwater improvements, and costs of demolition so staff could do their due diligence and the CRA could discuss the options.

Penniman noted Collier County provides incentives to developers who build or include affordable housing units.

“How do we compete with that?” she asked. “I think we’re in for some real weather incidents that are going to turn people away. I think a lot of people are leaving for that reason. It isn’t the paradise that they bought 10 years ago.”

Mayor Teresa Heitmann suggested giving up the affordable housing idea due to Live Local Act requirements, and considering other options once they have more data, while Vice Mayor Terry Hutchison suggested staff look into it for parking needs in that area.

CRA member Berne Barton said if the valuation has decreased, he’s in favor of razing the building to use the land for stormwater improvements.

“That’s the data and the information that we need in order to make an educated and informed decision in August,” Barton said, noting the property is too small to have a significant impact on affordable housing. “Our workforce housing issues are better solved in Collier County. … We need to be spending our time, energy and money on making sure that our community is draining properly and our residents’ assets are not getting underwater.”

He agreed with Penniman that they should consider selling once they have all the data, “so that we can use those funds specifically for resiliency and stormwater.”