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Commission hears detailed update on Krabby’s lease, directs title and UCC searches
Summary
City staff told the commission Krabby’s is in default and owes roughly $209,004; commissioners directed staff to complete title and UCC searches, continue efforts to recover past due funds, and prepare options including an RFP for re-leasing if needed.
City staff told the Fort Pierce City Commission on March 2 that Krabby’s — a long-term city leasehold — is in material default and the city is pursuing title and UCC searches as it weighs next steps.
The city manager provided a timeline showing the tenant requested an 18-month rent abatement on Sept. 26 and submitted an incomplete business proposal Dec. 29. Staff issued a default letter Jan. 30 and completed a final walkthrough Feb. 24, after which the city received the keys. "They did not provide the information that I asked for, revenues expense, the cash flow statement, and also there wasn't detail in the proposal how it was going to turn around," the city manager said, summarizing staff’s review of the tenant’s written materials.
Staff told commissioners the fiscal impact to the current FY 2025–26 budget is significant: the city budgeted $280,000 in revenue tied to the lease and staff reported $209,003.94 is past due through Feb. 26, composed of $77,072.15 in rent and late fees, $132,299.95 in property taxes for 2023–25, and sales-tax amounts. The manager said title work is expected to finish the week after the meeting and that staff had not yet reached agreement with the tenant on back payments or a mutual settlement.
Commissioners sharply questioned both city administration and the tenant. "Neither side in this has clean hands," said Commissioner Broderick, arguing the episode exposed systemic lapses in how the city monitors leases. Other commissioners said the tenant should have engaged earlier and called for clearer, centralized management of city leaseholds.
Several commissioners emphasized urgency around the title and UCC searches to determine whether lenders or other holders have claims on the property or equipment. Commissioner Gaines said she opposed approving wide rent relief for a tenant already in arrears: "If we're gonna give them that deal, we don't have to pay rent," she said, stressing fairness to other lessees.
Staff outlined next steps: complete title and UCC searches, pursue recovery of past-due amounts and late fees, and prepare options to re-market the property (including drafting an RFP) if the city regains clear title and possession. The commission directed staff to return with updates and to compile the city’s lease portfolio so commissioners can assess whether a dedicated property-management position or other corrective policies are needed.
The discussion did not produce a formal vote on settlement or abatement; staff said inaction by the commission could have statutory consequences for any outstanding settlement offers. The commission also asked staff to provide a public summary of lease inventories and the corrective measures staff will take to reduce future lapses.
The Krabby’s matter will return to the commission after completion of the title work and the UCC search.
