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PO Box 1212 Tampa, FL 33601 Pinellas Updated May 2006
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A Tale Of Two Beaches By Bob Andelmen bob@andelman.com YOU CAN’T GET THERE FROM HERE, if there is anywhere and here is Clearwater Beach.
If there is any concern on what’s now being referred to as “Billion Dollar Beach” over the intense ramping up of redevelopment activities, it’s that traffic – already slowed by too many cars on too few narrow streets with too few parking spaces – will stop altogether amidst the construction vehicles, road blocks, detours and visual distractions of unusually large cranes towering over the long tranquil tourist destination.
“It’s going to be a mess there for a while but it’s an exciting time,” says Joe Burdette, a partner in The Consus Group, an owner’s rep firm that has development clients up and down the Tampa Bay beaches. “Clearwater Beach is going to change, I think for the better. Lots going on that people can’t see, in pre-planning, but it’s going to look worse before it gets better. By the beginning of 2007, a lot will be torn down. It might be ‘08 before it cleans up.”
Call it the price of progress – a price the city is eager to pay after years of being at a standstill. Despite the opening of a towering new bridge that connects mainland downtown Clearwater with its beach for the first time without a drawbridge, the movement of cars and trucks between the two isn’t much better thanks to intensive activity from one end of the beach to the other.
Enchantment, Aqualea Resort, Kiran Grand Resort, Sandpearl, Indigo Beach Residences – these are just the biggest names of progress in Clearwater Beach. Each combines condominiums and hotel with remarkable architecture and four-star spa standards previously unknown here.
“God is not making any more beaches,” says Uday Lele, a former international candy magnate turned real estate developer. He is the money and inspiration behind Enchantment. “There are plenty of tomato fields and downtowns, but absolute beachfront, God is not making any more.”
Enchantment promises to be, well, enchanting. It is shaped like a butterfly but features a six-story arch in the middle of the building.
“When you stand in front of the property in the morning you will see the sun rise over the water and when you stand there in the evening, you will see it set. It will be sun-drenched. Very unique,” Lele says. “To the left hand side you will have a beautiful view of Sand Key Bridge, but you are far enough away not to hear any car noise. You will also see Sand Key Beach from a distance. And you will see boats going by all day. It really has the total scenery.
Out with the Old, In with the New
As a property management company, Travel Resort Services is a sure beneficiary of the condominium hotel explosion. Among the many new or coming properties it has under management is Madeira Bay, the 81-unit project which has long since been sold out. It is scheduled to open in May and includes restaurants, day spa and a conference center.
Also on the company’s roster: Coquina Beach Resort on Treasure Island, an 88-unit condotel set for an April 2007 opening; Madeira Grande in Madeira Beach, a 122-unit condominium planned for 2007; Skyline Resort, a 22-unit boutique condotel, expected at the end of 2006; the 18-unit Royal Orleans boutique hotel in North Redington Beach; Royal Camelot, a 22-unit boutique hotel in Clearwater Beach; and the recently opened 61-unit Pelican Pointe, also in Clearwater Beach.
“We’ll have about 1,000 units in our program by year’s end,” says Steven Rodriguez, director of Travel Resort Services. “By the end of next year we’ll have 1,600 just on the beaches. And a lot more are being built. The beaches are not nearing capacity by any means because we lost a lot of units from the mom & pops closing. We are starting to even out.”
But can they still be profitable for the owners with so many new units hitting the market simultaneously? “If you’re direct gulf front, the real estate prices have far exceeded the rentals,” he says. “The rentals won’t sustain it but they will help toward the cost. If they’re across from the beach, they can certainly be profitable for the owners.”
“I’ve been around the world 20 times,” he continues. “I’ve been to Niagara Falls, the Grand Canyon, the Taj Mahal and the Great Wall of China. But this was one of the most beautiful properties I’ve seen in my life. I told my architect, people should go to Disney then come to see Enchantment.”
The Art Nouveau building’s $5-million amenity package will include saunas, a Pilates room, a rain room for meditation, a fine dining lounge and a champagne bar. “Part of the appeal,” Lele says, “is that people will walk by and say, ‘Wow.’ Or, ‘Someday I’m going to be in there.’”
Indigo Beach Residences, a two-tower project set to rise on the site of the old Adam’s Mark Hotel, may cause many to say the same thing. It will offer 190 units, including one tower of 112 condominiums and a second of 78 condo hotel rooms. The hotel is currently planned as an unflagged boutique.
“We’ve had a tremendous response,” says Bob Glantz, vice president of sales and marketing for the Tower Division of developer Taylor Woodrow, which is building Indigo. “I think it’s wonderful what’s happening on Clearwater Beach.”
Don’t think that all the excitement is concentrated among the big boys and girls, however. Even the smaller condominiums and boutique condotels springing up are being given names that sound more appealing than the Joe-Bob’s Motels of the past: Marrabella; Sienna Sands; and three more Uday Lele projects: Chalet on White Sands; Chateau on White Sands; and Ambiance on White Sands.
NorthMarq Capital of Tampa has been involved in financing several beach condominiums, the latest being The Residences at Windward Passage. Senior vice president and managing director Bob Hernandez says he’s looking to do several more on the beach. “Residential has gone nuts,” he says. “The for-sale residential market is off the hook, as the kids say. It’s pretty wild.”
John’s Pass Village
By May, the first two phases of the John’s Pass Village redevelopment will be open. A much-needed new parking garage opened ahead of the retail and restaurants built around it. The final phase is now under way – the demolishing and rebuilding of three of the village’s five boardwalk buildings. The new buildings will house seven larger shops than the 11 they are replacing. Originally, retail spaces on the boardwalk were 400 square feet; the new ones range from 600 to 800 square feet. New boardwalk decking and a pedestrian bridge to the new parking garage are both part of the project. The last piece of construction equipment should be packed and on its way to parts unknown by December.
But beware the irrational exuberance, Hernandez warns. “At some point we’re going to get saturated with new projects,” he says. “Hopefully people will stop funding them and the values will hold up. If they overbuild them, supply and demand kicks in and we will get declining prices. The signs are that a lot of people have pulled in the reins and they’re not as interested in doing condominiums and conversions. It’s only going to be the best projects with the good, well-heeled developers with a lot of experience. Those will get done.”
Still, there are 65 projects either pending approval, approved or under construction along Billion Dollar Beach.
Joe Burdette thinks that Clearwater’s redevelopment plan, Beach By Design, and its own $10-million streetscape project, Beach Walk, are the common denominators among all the new announcements.
“Beach Walk is huge,” Burdette says. “Now we will have the same type of pedestrian area that you see in normal beach towns. It beautifies the beach, makes traffic flow better. Many of the new buildings will be sitting on that walk. Beach By Design has such strict criteria. I don’t think there is a bad building out there. These are four-star hotels, so it’s a different clientele coming to Clearwater Beach.”
Kiran Grand Resort is in the construction drawing stage. The Hyatt Aqualea is getting ready to start. Indigo Beach Residences is at the end of Beach Walk. Developer JMC Communities will be demolishing the Holiday Inn SunSpree this summer for luxury condos. Sandpearl is completing its parking structure and condominium construction should start soon.
Tennis and Boating
The new Treasure Island Tennis and Yacht Club will feature a three-story, $6.975-million club with 30,000 square feet and includes a fitness center, banquet facilities, spa, massage area and a dining area of Mediterranean design. It is currently under construction. “It’s going to be a nice project,” says Joshua M. Bomstein, business development manager for Clearwater- based Creative Contractors, which is the design-build firm on the club.
By 2009, Clearwater Beach should have rebuilt at least the 1,000 overnight accommodation units it lost from 2002 through 2006 due to redevelopment. Where’s it all leading? Super Bowl XLIII, Feb. 1, 2009.
Seriously. By the time the two teams that will battle for the 2009 NFL Championship are decided and are packing their bags for Raymond James Stadium in Tampa, everything in the works today for Clearwater Beach should be completed. “From a tourism perspective, with one of the major events in the country coming to the Tampa Bay area, we want to be mostly done by then,” says Geri Campos, director of economic development for the City of Clearwater. “A Super Bowl is a showcase to the entire region. So many people will want to stay on the beach and have four-star amenities.”
AT THE SOUTHERN END of the Tampa Bay beaches – St. Pete Beach – talk of new development is stuck in neutral, tied up as Clearwater Beach’s was for so many years by competing factions, an angry war of words and the courts. An ambitious city sponsored plan to upgrade and upscale two districts – one along the beach, one in the downtown core – is nowhere close to reality today.
“The scenario that is playing itself out is a little more heated and more divisive than anybody ever envisioned it could be,” says H. Gregg Nicklaus, president of the Sirata Beach Resort. “Our position, as hoteliers, is that we serve a vital role in preserving what Florida is and has been. We like what we do. We hope it will continue. But there are many reasons our industry is threatened. We think our city and commissioners did an excellent job of incorporating many elements of good planning into a growth plan.”
At issue in St. Pete Beach is whether to encourage a development plan that favors five-star condominium/ hotel properties that would maintain tourism as a significant part of the community’s economy or to allow rampant condominium development which, many fear, will turn the beach into a ghost town at certain times of the year. A citizens’ group has tied the city’s plan up in legal challenges for at least the near future.
Missy Pike, executive director of the Tampa Bay Beaches Chamber of Commerce, is siding, not surprisingly, with current and potentially future hotel operators.
“We are fully supportive of the idea of condotels,” she says. “To just do condominiums will hurt us all. We hope residents understand; this will upgrade the area. We don’t want to lose the small town feel. (Otherwise) the developers will come in and do anything with the land.”
St. Pete Beach city manager Mike Bonfield is keeping a level tone about the dispute. “We’re in litigation,” he says with resignation. “Not much is happening till that is resolved … All we can do is just do the things in the city that can get done in the meantime and hope that the legal or political process will run its course. We did pass a planned development ordinance which allows a few areas of the city to move along. It allows the redevelopment of the Leverocks property on the east end of the core and Dolphin Village. We expect those to go forward in the near future for mixed-use development.”
Treasure Island
The new toll-free Treasure Island Causeway Bridge replacement is on schedule for completion in June. “We’re hoping that Johnson Brothers Co. will make their incentive deadline in June,” says city manager Ralph Stone. “If they’re one month ahead, they get a $1-million bonus. Everybody wants them to get their money, that’s for sure.”
Bonfield says that there are still groups trying to put land together on the west end of Corey Avenue. But the real battleground is beachfront redevelopment.
“The city’s plan added some density and some height to a limited, one-mile stretch on the west side of Gulf Blvd.,” says Nicklaus. “The problem is that the city took it upon itself to be proactive in preserving a balance and make it economically sound for those investing money.”
Until the plan was halted, beachfront property futures were hotly traded and several new projects were being discussed.
“As long as they continue to appeal this thing, we’re dead in the water,” says Keith Overton, vice president and general manager of the TradeWinds Island Resorts. “It’s not a good situation to be in. I’m optimistic we’re going to work through it, but it keeps stretching the time frame out.”
If the redevelopment plan goes through, look for the TradeWinds to be among the first to announce plans. “We would redevelop the Island Grand property,” Overton says.
There’s Some St. Pete Beach Movement
Despite reports to the contrary, there is redevelopment occurring on St. Pete Beach, although most of it is in the still hot condominium market. Bella Marguerite, for example, is an 18-unit condominium on the Intracoastal Waterway a few blocks north of the landmark Don CeSar Beach Resort. It is being developed by SimDag, a Tampa company which previously built La Contessa in Redington Beach and Bella Rosa in Sand Key. It also partnered with Donald Trump on Trump Tower Tampa, which broke ground in March.
As for his own property, Nicklaus says that even if the city’s redevelopment plan were approved tomorrow, the family-controlled Sirata Beach Resort will not have a “For Sale” sign on it.
“We have no interest in selling,” Nicklaus says. “There is a series of properties that will immediately develop. When those occur, there will be some reaction in our community. We aren’t going to spend any dollars until we know what is available to us and all the legal impediments are overcome. There are other properties at the end of their economic life and they’re coming down one way or the other – the Travelodge, the Coral Reef. They’re destined for a bulldozer. We’re perfectly positioned to be a moderately priced alternative to any new four- and five-diamond properties. That’s an enviable position.”
To say some in St. Pete Beach are envious of the rapid changes coming to Clearwater Beach might be an understatement. “Clearwater is going through major redevelopment,” Pike says. “As much as they’re part of our area, they’re competition. We have to keep up and make sure our properties are nice. They’re going to get a new Hyatt; I want something similar to offer our guests.”
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