Pasco County’s high-growth corridor is attracting more than single-family homes, restaurants and retail outlets.
Nine luxury apartment complexes — two already leasing to residents, two that remain under construction and five more that are proposed — will bring more than 2,500 multifamily units to the county’s southern tier from Odessa to Wesley Chapel.
“This is a growth corridor for the greater Tampa Bay area. We believe in this market,’’ said Sarah Dodd, a spokeswoman for apartment-builder AG Spanos, which is proposing 280 units in Land O’ Lakes.
Not everyone is enamored with the possibility of more high-end multifamily housing along the heavily traveled State Road 54 and SR 56 corridor. One Pasco commissioner says the county would be better served if the land was reserved for job-creating commercial uses.
“It is turning into apartment city. That’s what it is,’’ said Commissioner Mike Moore. “How much more do you need right there?’’
The apartment boom is not unique to Pasco.
The Real Data research firm reports more than 6,100 units under construction and another 6,500 proposed in the Tampa metro market that includes southern Pasco. The average monthly rent in the region is $1,220, a 1.6 percent increase over the past six months. Vacancy rates are below 5 percent.
Real Data, based in Charlotte, N.C., predicts continued strong demand for apartments in the coming year.
In September, Cushman & Wakefield reported Pasco County had 8,570 apartment units renting on average for $1,067 monthly and occupancy rates of 96.2 percent, tying North St. Petersburg for the highest occupancy rate among the region’s 20 market areas.
“That means they are satisfying a huge, huge need that is out there in the community,’’ said Commissioner Kathryn Starkey.
Erick and Alyson Trusong moved into Mystic Pointe in Land O' Lakes in October, relocating from an apartment complex in Wesley Chapel where they had lived for the previous six years.
Apartment living allows the couple to wait for a slow down in single-family housing prices, while they live in a resort setting with no worries about maintenance. And their rent payment includes cable, internet and trash disposal, said Erick Trusong, 40.
“It really kind of got too busy for me in Wesley Chapel. But I felt like I was living in a hotel. It’s great. We were close to Wiregrass and close to the (Tampa Premium) Outlets and close to Tampa,’’ he said. “Moving down toward the Suncoast (Parkway), we still have access to go the outlets, but it’s a little quieter. I have access to everything, but I can still have my quiet.’’
Moore points to different statistics to make his case. He notes a Raymond James Financial report from early this year that cited a national decline of multifamily households, as people, likely older Millennials, shifted to buying or renting single-family homes. The report suggested real estate investors target single-family rental homes over apartment complexes.
The advice is noteworthy because flipping apartment complexes is big business.
In July, a Houston company purchased the 9-year-old, 208-unit Preserve at Zephyr Ridge complex west of Zephyrhills for nearly $21.5 million. A month earlier, the 322-unit Integra Junction complex built two years ago along SR 54 at the front of the Asturia development in Odessa, sold for $57.6 million. In 2012, the 451-unit Lantower Cypress Creek Apartments south of SR 54 in Lutz sold for $62.2 million. Five years later, it sold again for $78.8 million, a 27 percent gain.
Moore said that too many apartment complexes could exacerbate already crowded schools. His bigger complaint, however, is that a saturated market can lead to high vacancy rates and long-term decay among complexes over a 10- or 20-year period.
Other commissioners aren’t so sure, but agreed the apartment influx helped spur an unexpected development — a proliferation of self-storage businesses in high-profile locations.
Over the past several months, commissioners have debated the merits of multifamily housing on three occasions, most recently in a Nov. 27 discussion about updating the county’s road transportation fees. Under the fee schedule, the county provides developers’ subsidies to encourage higher density housing in the so-called urban service area along the U.S. 19 and SR 54/56 corridors.
Moore, the leading critic, noted that many of the complexes are being built or are proposed for his district. He suggested increasing the transportation fee. Commissioner Jack Mariano initially agreed, but later withdrew that support.
Wiping out the county subsidy for new apartments in the urban service area amounts to a 7 percent fee increase, or $301 per apartment.
“The incentive is small enough that it is inconsequential to the high-end’’ apartments, said Pat Gassaway, president of Heidt Design and a member of the citizens committee that helped update the mobility fee schedule.
The public debate is centered exclusively on luxury apartments along SR 54/56. Nobody disputes the value of redeveloping a portion of the Gulfview Square mall on the U.S. 19 corridor into an apartment complex, nor are there complaints about projects specifically for people age 55 and older.
Here are the current and proposed projects along SR 54/56, according to Pasco County records and Real Data:
There are 384 units called Volaris Starkey Ranch are under construction at the northwest corner of the State Road 54 and Gunn Highway. Waypoint Residential is the builder.
Just east of the Suncoast Parkway and SR 54. near the entrance to Bexley by Newland Communities, sits Mystic Pointe. The complex, is already leasing apartments, and will have 252 units when completed.
At the Brightwork Crossing development at the intersection of SR 54 and Wesley Chapel Boulevard, Arlington Properties is building 341 apartments called Tapestry Cypress Creek.
North of State Road 56 near the Shops at Wiregrass mall in Wesley Chapel, Atlman Companies is putting the finishing touches on the 392-unit Altis Wiregrass Ranch. Altman also is proposing a 360-unit Altis complex at the South Branch Ranch development on SR 54 in Odessa.
Two separate complexes are planned for the vicinity of SR 54 and Sunlake Drive. Just a quarter mile southeast of that intersection, the county received preliminary plans for the 300-unit Long Lake Ranch apartments. Likewise, developers are proposing 280 apartments at the northeast corner of SR 54 and Mentmore Boulevard at the entrance to the Concord Station neighborhood.
AG Spanos is proposing 280 apartments on the north side SR 54, east of Twin Lakes Drive in Land O’ Lakes.
Sierra Properties also has filed preliminary plans with Pasco County for a three-building complex on 11.5 acres in the northern portion of the Cypress Creek Town Center northwest of the Interstate 75 and the SR 56 interchange.
Commissioners are scheduled to give final consideration to the transportation fees on Dec. 11.
As a compromise, commissioners agreed last week that fees for apartment complexes and storage units will remain unchanged for now. However, they will reconsider fees next year in conjunction with possible new zoning restrictions, limiting what can be developed along the SR 54/56 corridor.
But even that compromise has its critics.
“Where does it stop?’’ asked Commissioner Mike Wells Jr. “The market decides. We’re walking a fine line when we start deciding.’’
Contact C.T. Bowen at [email protected] or (813) 435-7306. Follow @CTBowen2.