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Scientology buys prime parcel in Clearwater

By Robert Farley, Staff Writer
In print: Thursday, August 7, 2008

Scientologists bought the cleared property west of Fort Harrison Avenue between Jones Street on the bottom and Georgia Street on the top.
	[JIM DAMASKE | Times]

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ADVERTISEMENT Related Links Complete coverage: The Church of Scientology Let's Talk: Readers abuzz over new property

CLEARWATER — In one of its biggest purchases in years, the Church of Scientology has added 5 acres to its already defining downtown presence.

The $10-million cash purchase signals the demise of an ambitious waterfront condominium project proposed by a group of Scientology parishioners who assembled parcels immediately north of downtown four years ago and shared visions of turning downtown Clearwater into another Naples.

Despite having no experience in condo development, Triangle Development partners Ben Kugler and Ron Pollack hoped to ride the condo boom that played out in the first part of this decade. They put forth fanciful plans for 325 water-view luxury units and a row of tony retail shops along busy Fort Harrison Avenue.

But like so many condo plans, the project sputtered in a weak real estate market. After defaulting on terms of an $18-million loan from Mercantile Bank, Triangle asked earlier this year for yet another extension, and to renegotiate.

The bank balked, and instead decided to cut its losses and force a sale.

Triangle had presold just 55 units, Pollack said, about half the number needed for the project's first phase. "The market folded up on us," he said Wednesday.

Pollack said Mercantile asked him and his partners to contact the church to see if it had interest in the land.

Church officials initially declined. The church, which makes Clearwater its international spiritual headquarters, already was in the midst of a $120-million rebuilding campaign downtown.

"We didn't really have any (expansion) plans when they first contacted us about a property acquisition," said church spokeswoman Pat Harney. "But eventually we took a look at it and said okay."

The church isn't sure what it will do with the property, Harney said. It owns several properties immediately to the south.

The church's $10-million bid was the only serious offer, Pollack said. He and his investors spent $12-million assembling the properties, he said.

One parcel is notable in Clearwater history. Rock singer Jim Morrison lived with his grandparents for a year in a little house on the water in the early 1960s while attending St. Petersburg College.

While Triangle's failed project, named Island View, resulted in an apparent financial loss for Mercantile, Pollack and his partners also lost millions, he said. They spent four costly years trying to make it go.

Scientology now has 29 properties in Clearwater, most downtown.

South of the just-purchased Triangle property is the seven-story Ocean View condo building, which the church bought in 2006 for $7.8-million. Plans call for remaking the Ocean View, formerly called the Belvedere, into 23 luxury, extended-stay units for visiting Scientologists. Remodeling cost: up to $6-million.

Just south of the Belvedere and also on the water is Scientology's now-sprawling Sandcastle complex, a mix of hotel rooms and training quarters. Once a small, privately owned tourist hotel, the Sandcastle has been in church hands for decades and expanded many times.

Now it's overtaxed, officials say, so plans call for a six-story, 60,000 expansion to be built on a vacant lot abutting the recently purchased land.

Clearwater Vice Mayor George Cretekos called the sale of the Triangle property "unfortunate, because we absolutely want people to be moving into the downtown. That's the key to any redevelopment of our city. "

Cretekos said he told church officials if they weren't going to use the property themselves, he hoped they would consider making it available for affordable housing, or donate the land to the city. Church officials didn't respond with specifics, he said.

If the five acres become a church facility, it will mean another valuable piece of waterfront land comes off the property tax rolls.

Triangle paid more than $56,000 in property taxes on the vacant land last year. The church will still pay property taxes until it develops the property. Then the portions used for religious purposes would be tax exempt.

Early this year, Scientology opened its latest hotel for visiting church members, the Oak Cove complex on downtown's south side. It offers high-end overnight stays after a $26-million renovation.

In April, the church also started $30-million in renovations to its well-known Fort Harrison Hotel, which will have 220 rooms.

In all, current church expansion and remodeling projects will give Scientology 725 guest rooms in downtown Clearwater.