Palm Coast’s Westward Expansion on Hold

One of the favorite mantras of business is “grow or die,” alluding to the need for companies to seek expansion opportunities or fall behind the competition. For local communities with growing populations the drive for growth takes on many forms, from greater land area for residential and commercial enhancement to maintaining control over future economic development. For Palm Coast a big piece of that growth is on hold, at least for now.

Late last month land developer Raydient, a subsidiary of forest products company and real estate investment trust Rayonier, informed the city it is withdrawing its applications to develop more than 20,000 acres west of U.S. 1 with the potential to build more than 22,000 residential units along with more than six million square feet of non-residential space.

According to a 2024 draft economic impact study on the city’s website, the project would create additional jobs, property value, economic activity and public revenues over a 30-year construction timeline.

The draft report said more than 13,000 jobs would be created and a total economic output over the 30-year period of $14 billion, including $2.5 billion in impact fees and tax revenue. The plan also would have included the annexation of more than 7,000 acres of land in unincorporated Flagler County into the city.

Palm Coast City Manager Mike McGlothlin said growth west of U.S. 1 would help the city’s economic development efforts.

“The Westward Expansion could provide opportunities for development that are not available within the city’s existing boundaries, particularly additional opportunities for non-residential development,” he said. “Expanding the city’s non-residential tax base and creating new employment opportunities are among City Council’s goals.”

The project also includes construction of the so-called Loop Road, which is not part of the Raydient application.

“The withdrawal of Raydient’s applications does not affect the Loop Road project,” he said. “Loop Road is a separate transportation project. The Loop Road project has received state appropriations, and state leaders and transportation officials have supported the project because of its anticipated role in the future regional transportation network. The roadway is expected to provide an important local connection as regional transportation improvements continue to advance, including planned connections associated with the new County Road 2209 roadway system linking the Orlando and Jacksonville regions.”

McGlothlin said he is not concerned about any negative impacts from the withdrawal of the project applications on future economic development.

“The city does not anticipate a negative economic development impact as a result of the withdrawal,” he said. “The city currently has several significant non-residential development applications moving through the process that have the potential to expand the city’s tax base and create jobs.”

Annamaria Long, executive officer at the Flagler Homebuilders Association, said the withdrawal by Raydient will have an impact on the city and county’s development, but not for the obvious reason.

“The area west of U.S. 1 gives Palm Coast an opportunity to plan for growth in a way we really haven’t had before,” she said. “We inherited a 1970s master-planned community with aging infrastructure, a heavy reliance on residential property taxes and limited opportunity for meaningful commercial growth. As Palm Coast eventually grows west, there is an opportunity to plan for different types of housing, commercial and employment uses, and the infrastructure needed to support them. That kind of balance is important for the long-term health of the community and can help take some of the pressure off existing residents.”

She added that Raydient’s decision changes the timeline for development but does not change the larger conversation about how the city grows westward.

While she was unwilling to speculate on whether the project cancellation will have an impact on residential construction in the county, she said the industry is dealing with a number of issues, from availability of skilled labor, mortgage rates, insurance costs and cost of materials.

“With that many things affecting the market, especially over the next six to 12 months, it would be difficult to separate out what impact, if any, Raydient’s decision has on residential construction,” she said.

Representatives from Rayonier did not respond to repeated requests for comment.