In the early 1980s, the city of St. Petersburg invited a number of major developers to the city and asked them for recommendations to redevelop the downtown area. On our company's first visit to the city, we were impressed with its beautiful location and many neighborhoods but disappointed by its downtown blight. However, we believe that the downtown waterfront could again be a jewel.
That is why we responded (we were the only one) to an invitation for a partnership with the city to develop the downtown area _ known as the Bay Plaza Project. We shared the vision that downtown can be an attractive destination for people as a retail/entertainment center. We are still committed to this vision.
Since we signed an agreement with the city in 1986, we have acquired property, demolished old buildings and constructed new facilities; all of this is within the framework of a vastly changing economy and a new retail environment. The fact remains that there has been significant progress in downtown St. Petersburg. Looking at the downtown core today compared to what it looked like in the mid-'80s, our investment of $37-million in downtown St. Petersburg has at least improved the "look" of downtown. It is not what we want for the future, but it is a start.
But the real question is, what will it take to fully develop downtown St. Petersburg? From our perspective, it will take basically four elements. First, commitment _ we shared with the city and its residents a vision to redevelop a six-block area of the downtown. Today, to attract retailers and other tenants, there must be a solid, good-faith commitment by both Bay Plaza and the city with a specific time frame for completion of the project. This is essentially the proposal we have made to the city.
Second, we need an updated redevelopment plan. In 1988, the original plan was based upon large department stores as the primary attraction. Despite several efforts to attract this type of retailer, it just did not prove viable with the shake-out in the retail industry and the significant change in the U.S. economy. Future plans must focus on smaller retail and entertainment units with possible residential space.
Third, specific project performance periods. We have proposed three six-month performance periods. During the first six months, we will update our plan with public input to find the most economically viable options for us to move forward. This plan will be submitted to the city for its approval.
The project must have tenants who are attracted to lease retail, entertainment and other space. We propose that during the second six-month period of our new plan, we will lease more than 50 percent of the space to tenants with a downtown interest. If this is done, we will go to the next phase.
The final six-month period is for financing and construction. Once we have the commitment, a plan and marketplace interest in going forward with the downtown plan we can secure financing for the project and begin construction.
While this is a very simple and straightforward proposal, it does require a fourth element _ community support. Up to this time, the Bay Plaza Cos. have invested millions of their own funds in this project. We have received no tax subsidies or funds from the citizens of St. Petersburg, but we have had community support. This support will be vital in the future.
We believe that our performance proposal (three six-month phases) can achieve our mutual objectives over the next 18 to 21 months. With continued community support and involvement, we can create an economically viable project that is an exciting, attractive retail and entertainment destination.
We look forward to ultimately succeeding in redeveloping downtown St. Petersburg.
John H. Fox, is president of the Bay Plaza Cos., Inc.