NEW PORT RICHEY – Yep, the city is back in the commercial real estate business.
New Port Richey is finalizing a deal to buy a key piece of property at the southeast corner of U.S. 19 and Main Street for about $1.7 million, using Community Redevelopment Agency funds.
Purchasing the 1.4 acre former Walgreens property from Palm Harbor-based owner Encore-Main is a bold move for a city with a checkered history in real estate speculation.
The plan to buy the property emerged as a way to revitalize the long-troubled gateway into the city. The Walgreens property is part of an adjacent swath of land with various owners that has created a difficult road to redevelopment.
Next to the Walgreens site are 2.6 acres owned by AG Development. It holds the former Suncoast News building, where an Aldi grocery store has long been proposed. AG’s parcel is oddly configured, with a half-acre cutout of its U.S. 19 frontage owned by Rivergate Park, where a former gyro and seafood restaurant sits. South of that parcel is a SunTrust bank on 2.1 acres. Adjacent to the SunTrust property are 1.84 acres owned by the city — known as the River Road property — that once held a church.
It appeared that AG Development would buy the restaurant and SunTrust properties and use them as retail out-parcels to the Aldi store, City Manager Debbie Manns told the Tampa Bay Times.
The plan fell through, however, as another buyer emerged for the restaurant property. And SunTrust opted to hold onto its property pending its merger with BB&T bank, Manns said. Aldi is still interested, she said, but AG has since pitched a hotel on its property.
Meanwhile, zoning complications halted plans for a Famous Tate appliance store on the Walgreens property. The property has two zoning designations — highway commercial fronting U.S 19, and downtown fronting Main Street. That conundrum led the city to consider buying the property.
“There are so many moving parts here," Manns said. "Absent the city’s participation, I really feel we will be disappointed with what happens there.”
The New Port Richey Community Redevelopment Agency, made up of City Council members, voted 4-1 last week to purchase the Walgreens property after Manns pitched the project.
“If we don’t have confidence in ourselves, no one else will,” she said.
“I think this might be a once-in-a-lifetime opportunity to secure the way the entrance to downtown New Port Richey is going to look for generations to come,” Mayor Rob Marlowe said.
City Councilman Peter Altman agreed with Manns’ assessment that the city needed “skin in the game” to steer the redevelopment. The city already owns the southern piece of the area in question, he said.
“We have always identified this corner as critical,” he said. “It’s begging for, as the city manager said, some leadership, and we would have both corners of that and truly be partners in what the development plans are.”
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Deputy Mayor Jeff Starkey voted against the purchase. He pointed to the city’s history of buying real estate since the mid-2000s, which proved disastrous after the real estate crash. The city bought the former First Baptist Church site on Circle Boulevard for $3.1 million in 2005, for instance, and sold it for $300,000 in 2016 to help spur a downtown residential project, he said. And the city still owns the historic Hacienda Hotel, which is under renovation, after buying it for $2 million in 2004.
“This one makes me nervous, it really, really does. It is a ton of money,” Starkey said. “I pray to God that I am wrong on this one and that you are all right five years from now.”