St. Petersburg to spend $19 million on 24 affordable homes in The Deuces
By Breanne Williams
Tampa Bay Business Journal
Published: Jan 19, 2024

St. Petersburg City Council has agreed to throw millions of dollars behind a long-awaited affordable housing project.

The Deuces Rising project will build 24 affordable and workforce townhomes on roughly 2.7 acres along the 22nd Street South corridor, an area otherwise known as The Deuces. The townhomes will sit on 1.6 acres on the western portion of the site, along both sides of Fairfield Avenue South and will include a mix of floorplans ranging from 1,600 to 1,800 square feet.

Initially, there were plans to tie a commercial development to the project on the site’s remaining acre to incentivize small businesses to come to the area and revitalize the long-desolate neighborhood. Despite enthusiastic support from city officials and residents, the land has sat vacant for years.

City council on Thursday approved spending $13.12 million on the project, though many voiced frustrations over the high cost of building the townhomes. Though the project began in 2021, the city has had difficulty securing a guaranteed maximum price as the costs of labor and supplies have increased. In total, the development will cost the city approximately $19.1 million, including the cost of utilities and infrastructure.

“The thing I struggle with is it looks like a subsidy just on the cost of construction is going to potentially be $500,000 per unit, and that could subsidize five other affordable housing units on another project,” Councilmember Richie Floyd said. “I’m struggling to say, ‘Is this what’s most impactful for our money?’”

City Administrator Rob Gerdes told the council that the situation is a rarity and not a cost the city would be willing to pay for every development. He said if council didn’t approve the cost of the townhomes, it could be another four to five years before they were able to present a new development proposal for the site. Thursday’s vote came after years of failed and delayed plans for the property.

The city purchased the site for $2.2 million in 2007. The mixed-use project was approved in 2021. However, the cost estimates caused the city to reevaluate its priorities.

In February 2023, the commercial portion was set aside — though not eliminated — and staff worked on getting new numbers for just a residential development. For most of last year, the city and Horus Construction, which designed the project, have worked to manage costs.

Twelve of the townhomes will be sold to those making 80% of the area median income, and 12 units will be for those making 120% AMI or less. With $60,000 down payment assistance, staff told the council the estimated costs for the homes were approximately $223,000 for those making 80% AMI and $317,000 for those making 120% AMI.

There will be resale restrictions to ensure long-term affordability. A homeowner’s association will be formed for the property with fees set to “ensure ongoing maintenance and long-term repairs and improvements are completed,” according to city documents.

Many at the dais voiced frustration with “astronomical costs.” Councilmember Lisset Hanewicz questioned whether the total $19 million investment was worth 24 townhomes when there was such a “great need” throughout the city for housing. Financial decisions of this nature, she said, would sink any business.

Councilmembers approved the funding 5-2, with Floyd and Ed Montanari voting no. Councilmember Brandi Gabbard was absent.

“We all understand the affordable housing crisis the city of St. Petersburg is facing right now, but the math with this deal is just so far out of the ballpark, it’s not even in a grey area,” Montanari said. “In the private sector, this would just never be done.”

With the funding approved, the goal is to have construction begin by March or April, with the homes being delivered by the summer of 2025.