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City may crunch condo conversion

Codes have allowed a rash of hotel closings that could dent tourism in Clearwater.

Published April 27, 2005

CLEARWATER - City leaders, who last week watched a developer win approval to replace a 210-unit beach hotel with condominiums, are now considering a change to make such conversions more difficult.

Worried, like many, that hotel rooms are being sacked for high-end condos along the Gulf of Mexico, City Council members want to tighten development regulations to protect the city's tourist base.

The changes would make the conversion of large beach hotels into condominium developments cost-prohibitive.

Now, bigger beach hotels have more rooms than allowed by current code. And if someone wants to replace a hotel with condos, they are permitted to convert the existing rooms into residential units at a ratio of 4 to 3. The city proposal would force developers to only convert the number of rooms allowed by code - shrinking the number of potential condos by hundreds in some cases.

The current framework has become "an unintended incentive to convert hotels to condos," said Mayor Frank Hibbard. "Developers are going to maximize profits. And condos are more profitable than hotels."

Last week, a group won the right to tear down the Holiday Inn Sunspree on S Gulfview Boulevard for 149 condominiums in two 150-foot towers. Developers on that project said the site was better suited for residential use.

Council member Bill Jonson said that was not the intent of the city's codes.

"Sometimes, when you look back at something you did, you say, "Oops," Jonson said. "I don't see it as a property right."

The change would be effective citywide, said City Attorney Pam Akin, though conversions have only appeared on the beach.

City planning director Michael Delk said he does not have a list of properties that would be affected.

By conversion, the city means a change in use, regardless of whether a building is torn down or simply renovated.

In practical terms, the plan could prove significant.

Take the former Adam's Mark property for example, which has been closed since October for repairs. The resort is supposed to reopen as a Radisson, though some worry it will be razed for condominiums.

Under the current code, the 217-unit hotel could be transformed into roughly 162 condos. If the code is altered, only 57 condos would be permitted.

The number of condos to replace the Red Roof Inn on S Gulfview Boulevard would be cut in half - from 51 to about 24. At the Travelodge next door, potential condo units would drop from about 40 to 19.

"This will certainly dissuade some folks," said Clearwater development attorney Ed Armstrong. "The economics will certainly not be as favorable."

Council member Hoyt Hamilton, who himself owns a Clearwater Beach hotel, said rising property values sometimes shoehorn developers into condo projects. He thinks the city needs to also consider adding incentives for hoteliers to stay open.

"My family, if we wanted to build a hotel, keep the Palm Pavilion and build a new property, we're the ones who could afford to do it," said Hamilton, whose 29-unit hotel is small enough that it is largely unaffected by the proposed code changes. "If we sell the property, whoever we sell it to is no longer in a position to build a hotel. They're going to pay more for that property than they can to make the numbers work."

The Pinellas Planning Council, the city's planning board and the City Council will all take up the matter. It will be likely months before anything becomes effective, saidDelk.

In the interim, developers will likely expedite plans to avoid the proposed restrictions, Armstrong said.

[Last modified April 27, 2005, 00:47:14]

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