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Clearwater grants $500,000 to help redevelop downtown eyesore

The $3 million project is led by two businessmen who were part of a land-buying push by companies tied to Scientology.

CLEARWATER — The city on Monday awarded $500,000 to two developers who are proposing to turn a long-blighted building on a prime downtown corner into 14 apartments with ground floor commercial space.

The grant will be paid out only if partners Ray Cassano and Shahab Emrani complete the project at the corner of Chestnut Street and Myrtle Avenue within 24 months, according to the contract.

The City Council, acting as the Community Redevelopment Agency, approved the grant in a 3-2 vote, with council members Kathleen Beckman and Mark Bunker in opposition.

Beckman wanted the city to require the developers maintain the property as apartments for longer than the five-year minimum outlined in the agreement. Bunker expressed concern over the developers’ ties to the Church of Scientology. Cassano and Emrani were part of the wave of parishioners who, using limited liability companies, bought an unprecedented amount of downtown real estate between 2017 and 2019.

In that time, the church and 32 companies controlled by parishioners bought about 100 properties in the center of downtown, where the city is trying to spark a revival of retail, restaurants and housing. The proposal for the building on Chestnut Street is one of few redevelopment proposals to come from the wave of purchases.

Although most of the council members expressed concern over insufficient parking in the design, no other developers are moving to build much needed residential projects downtown. With the mindset that more housing is key to spur business revitalization, city officials said the $3.3 million project could be a catalyst for long-term growth.

RELATED: ClearTakeover: How Scientology doubled its downtown Clearwater footprint in 3 years

“It’s better than anything else being offered at the present time,” council member Hoyt Hamilton said. “Something is better than nothing. And if this will add to our ability to attract future investment, with the lack of anything else on the horizon right now, I think I can agree to move this forward."

Brian Aungst Jr. an attorney who represented Cassano and Emrani in their application, argued the city faced little risk in the deal. The developers will only receive the funds if they complete the project and submit receipts of expenses for reimbursement.

The grant is also coming not from citywide property taxes but the Community Redevelopment Agency fund, an incremental tax for revitalization imposed on downtown property owners, which include Cassano and Emrani, he said.

Cassano and Emrani both serve on the Downtown Development Board, a body elected by downtown property owners that uses revenue from that special taxing district to market downtown. City attorney Pam Akin said the developers’ sitting on the elected body does not pose a conflict because the Downtown Development Board and the Community Redevelopment Agency are separate.

“This is an incredible opportunity for the (Community Redevelopment Agency) to not only activate and rejuvenate probably the most significantly blighted property in our downtown core, but also to incentivize sorely needed workforce, more affordable housing,” Aungst said.

The project is not being built as affordable housing, but redevelopment agency director Amanda Thompson said rates are expected to be about $1.50 per-square foot, which is less expensive than the nearby Nolen and Apex 1100 apartment complexes.

The project provides 17 on-site and eight off-site parking spaces for the 14 apartment units and ground-floor commercial space. Mayor Frank Hibbard questioned the feasibility of that structure, but highlighted the need for change on such a prominent site.

“That property has been hideous for the entire time I’ve lived here,” Hibbard said. “I am enthusiastic about getting that out of our corridor that all of our residents and visitors see as they go to and from the beach.”

The limited liability company controlled by Cassano and Emrani bought the two-story building at 708 Chestnut Street in April 2018 from fellow Scientology parishioners Sue and David Minkoff.

It had been under ownership of members of Scientology since at least 1997 and has been in disrepair for decades.

Five companies controlled by Cassano and Emrani bought nine downtown properties since 2017. Five of those — a vacant Walgreens on Cleveland Street, the empty Chestnut Street building and three vacant lots north of downtown — have remained undeveloped.

Before the wave of land purchases in 2017, companies controlled by Cassano and Emrani already owned a vacant lot on Hendricks Street and a vacant 3-acre property on Grove street, properties that have remained undeveloped for years.

In describing her concerns about the project, Beckman also questioned why the owners had not invested in the property until now.

“They’ve chosen to keep it blighted from when they purchased it and just sit on it," Beckman said. “It’s not like they’re coming in and and they’re like ‘Hey I want to buy this piece of property and revitalize it right now.’ They’ve allowed it to sit there as an eyesore for a number of years.”

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