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Troubled Corey Avenue hotel project's future faces uncertainty

Developers of a major hotel-retail-marina complex on Corey Avenue won city approval, but the troubled project has taken so long, the property is now in foreclosure and its future is uncertain.

JOHN BODZIAK | Corey Landings LLC

Developers of a major hotel-retail-marina complex on Corey Avenue won city approval, but the troubled project has taken so long, the property is now in foreclosure and its future is uncertain.

A long-anticipated hotel development is lined up for the waterfront on the east end of Corey Avenue, but there is still uncertainty about the project.

Developers from Michigan and Missouri received city approval last month for a project with as many as 200 hotel rooms, 60,000 square feet of retail space, a 200-space high-dry boat storage facility and a 136-slip marina on Boca Ciega Bay.

But the project has been so long in the making that Corey Landing Development LLC now finds itself in foreclosure and facing an auction of the property Friday.

Managing partner David Jankowski said the city approval and a franchise agreement with Wyndham Hotels should make financing easy for the $85-million project.

He said he's in talks with representatives from the J.P. Morgan Urban Renaissance Property Fund about a possible injection of $25-million plus loans to complete the project. But he said if that doesn't materialize before the auction date, he will file for bankruptcy reorganization to stave off the sale and buy time to refinance.

"This is going to be a great project for the city and the whole Tampa Bay area," Jankowski said. "We're there."

Not everyone feels so sanguine about the project's prospects.

"I think Corey Landing is going to die," said Commissioner Mike Finnerty, noting the project has suffered financial problems for a long time and developers reorganized once already.

"I've got my fingers crossed, but I don't think it's going to happen, and then we'll have nothing there for years."

The site used to be home to a Leverock's restaurant, some small apartment buildings and other assorted businesses. Developer Bill Karns bought the property two years ago for $40-million with the intent of building condominiums and commercial space, but that project never got off the ground. Jankowski and his partners were investors in that deal but took over after the initial project could not gain approval, Jankowski said.

Jankowski changed the concept to a hotel and started shopping for franchises. After a deal with the Sofitel hotel chain fell through, he said, lender Rate Investment Trust got nervous. Foreclosure proceedings began a few months ago on the outstanding $35-million debt.

But now that developers have paid the $60,000 franchise fee and have a signed agreement from Wyndham, final investment should be easier, Jankowski said. He had an on-site meeting scheduled with J.P. Morgan last week but the fund's representative had a health problem that forced rescheduling of that meeting to this week. Jankowski said the Morgan fund is environmentally oriented and the project will contain elements of energy efficiency and sustainable development.

The project site has been something of a political football in the ongoing disputes over redevelopment on St. Pete Beach. Citizens for Responsible Growth, a political action committee, had opposed the zoning for the original incarnation of the project and its representatives filed a lawsuit on another project, the redevelopment of Dolphin Village, over the same zoning issues. Jankowski said he was able to work out an understanding with CRG.

The project would not include any condominiums and would only rise 77 feet, two aspects Jankowski said activists liked.

The project also does not require vacating Corey Avenue, a stumbling block for earlier designs. Developers will build street parking in the right of way along Corey and use that toward their requirements.

As part of the agreement with Wyndham, Jankowski has to begin construction by July and have it completed within two years. The franchise deal only kicks in when the hotel opens.

The complex also includes stand-alone retail buildings around the main hotel complex. There will be at least two new restaurants there, including a Salt Rock Grill, Jankowski said.

The project also includes public green space on the water and a connection to the city's recreation center along a walkway under the Corey Causeway.

Jankowski and his partners are also involved in a large development in Petoskey, Mich., that has been hampered by financing troubles.

Newspaper reports from that city say the developers have until March 15 to provide proof of new financing for that project.

Paul Swider can be reached at pswider@sptimes.com or 892-2271.

Troubled Corey Avenue hotel project's future faces uncertainty 03/08/08 [Last modified: Thursday, October 28, 2010 9:30am]
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