Clearwater leaders hope to turn a $700,000 loan into a $7-million affordable housing development inside one of the city's most drug-ridden, prostitution-filled areas.
The move, they say, should help revitalize the East Gateway, a main passage to the downtown. But the outcome won't be immediate.
"To fix that area, you basically have to go block by block and make incremental improvements," Mayor Frank Hibbard said. "Once other property owners and developers see what's happening, they'll be more willing to stick their toe in the water."
The 175-acre East Gateway has been a blight on Clearwater for more than a decade, city officials say. It's depressing and dilapidated and 77 percent of the housing are rentals.
City leaders have created a five-year plan to rehabilitate the area, which is bordered by Court and Cleveland streets and Missouri and Highland avenues. A main component to success is affordable housing.
That's where South Port Financial Services comes in.
"We're very concerned that Pinellas County is overlooking a lot of itself by not looking at doing these projects that are close to employment areas, especially with the gas and transportation problems," said Peter Leach, senior vice president of the company, which has done similar projects in New Jersey and New York.
South Port Financial Services several years ago built 10 townhouses on Ewing Street, but those sold at market value.
The Clearwater-based company now plans to buy Verizon's vacant 2-acre parking lot on Drew Street between N Betty Lane and Fredrica Drive. The city has agreed to put up $700,000 in federal funding it received for such projects.
If the development goes as planned, the city's loan becomes a grant. If not, the city gets the land.
The developer plans to build 36 townhomes, a pool, Jacuzzi, clubhouse and exercise room. The homes, which include three bedrooms, 2.5 bathrooms and two-car garages, are expected to sell for about $165,000.
The total project, called Country Club Homes, will cost about $7-million to build.
"We think home ownership will help stabilize the area," said Geri Lopez, the city's economic development director.
Plus, she said, it's necessary to clean up the area before some of the problems spill into other parts of Clearwater, which some nearby residents say is already happening.
The developer expects to close on the land in the next few weeks. Then site plans are due by the end of October, and development must start by Dec. 31, 2009.
Leach said that because the market is in a slump, his company decided on developing something more affordable to lure buyers.
Since fall 2006, the city has engaged residents and businesses, seeking input to find out just what they need to clean up the East Gateway and make it safer. The city's economic and development department's five-year plan pinpointed these key issues: safety, appearance, business environment, economic growth and housing and integrating the Hispanic community.