ST. PETERSBURG — The city is one step closer to taking over ownership of Tangerine Plaza, the Midtown commercial development that has seen two grocery stores fail in the last three years.
Summit Bridge, a creditor of developer Larry Newsome, on Wednesday bought his leaseholding rights to the plaza for what is believed to be about $2 million at a foreclosure auction, according to mayor's spokesman Ben Kirby. The plaza sits on city-owned land at 22nd Street S and 18th Avenue S.
Kirby said he didn't know the exact price of the deal.
The auction sale is an important piece of a complicated financial and real estate transaction involving St. Petersburg and Newsome's creditors that officials said will eventually allow the city to take control of the troubled shopping plaza — one that St. Petersburg already spent $2 million to open in 2005.
"It at least allows us to begin moving forward," said City Council member Karl Nurse.
The creditors are supposed to hand over the property to the city. Kirby said several steps remain before the deal can be completed.
After the county clerk issues a certificate of sale, Newsome has 10 days to object, said Kirby.
Newsome did not return a call for comment Wednesday. His cell phone voice mail box was full.
A final hearing in bankruptcy court might also be needed to close out the receivership. The property is being managed by Sembler Co., a powerful developer and real estate entity in St. Petersburg.
The shopping center's tenants will also have to be notified of the change in ownership, Kirby said.
The entire process could take months. City officials would not commit to a time frame for finally completing the deal.
"There are some real microdetails here," Kirby said.
The saga of the troubled Midtown strip mall has frustrated three mayors, especially current Mayor Rick Kriseman and his predecessor Bill Foster. When Walmart announced in January that it was closing the doors to its Neighborhood Market at Tangerine Plaza, it was almost three years to the day that Sweetbay announced it was closing the first groecery store to open at the plaza.
Last month a Tampa Bay Times investigation found that successive mayoral administrations had created and tweaked leasing rights without monitoring — or stepping in to help — Newsome's foundering financial stake in the center.
Early attempts to work closely with Sweetbay and Walmart officials under former Mayor Rick Baker gradually tapered off. When Walmart announced it was pulling out, Kriseman's staff hadn't been in face-to-face contact with store officials for nearly a year.
Kriseman has said that luring another major grocer to anchor the biggest space in the shopping center probably won't work. His administration has organized meetings for residents to submit their ideas for what should replace Walmart.
Suggestions have ranged from a food co-op to affordable housing. The mayor hasn't made any decisions yet on how to proceed with Tangerine Plaza's redevelopment, Kirby said.
Nurse, whose City Council district covers part of Midtown, has been involved in weekly meetings about the property's future. The best bet could be a smaller discount grocer like Save-A-Lot, he said. Perhaps, he said, the site could even house city social service outreach services.
"Frankly we're looking at all options," Nurse said. "But until what happened today happened you really couldn't get very far down that road.