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Plans for St. Pete Beach resort viewed two ways

A developer promotes a hotel-condo at the Travelodge site. A citizens group calls it a condo - and an example of shady dealmaking.

By PAUL SWIDER
Published September 28, 2005

ST. PETE BEACH - An investment document making the rounds in St. Pete Beach is viewed by some as a smoking gun of back-room dealing, while others are seeing the tourist-friendly future the city is promoting through its redevelopment efforts.

A company called Crossgate Partners, of Duluth, Ga., this year prepared an exclusive executive summary of a massive resort complex to rise on the property now occupied by the Travelodge at 6300 Gulf Blvd.

The document was intended for qualified investors and was never to be shared outside that circle, but Citizens for Responsible Growth, a group opposed to the city's redevelopment plans, got a copy and has passed it around the city as evidence of what members say are done deals based on regulations the city has yet to pass. CRG, which is also looking into connections to elected officials and others promoting the city's plans, says such deals masquerade as promoting tourism.

"This is not a hotel. Not a Hyatt, not a Ritz. It is a condo," said CRG attorney Ken Weiss. "This is not a big-name hotel. It is not a brand-name anything. It is a big-name developer."

Randy Moore, the managing partner of Crossgate, disagrees.

"We would like to develop a beach-front resort with transient accommodations with a full amenities package on the property," Moore said. The amenities are expected to include a first-class spa, restaurants and meeting areas. Moore said the resort will operate like any other hotel. As for opponents' interpretations, Moore said: "People will read this how they want it to benefit themselves."

Some of the disconnect comes from the fact that the new property would sell its 540 units as condominiums to be operated as a hotel-condo, a concept that CRG has never accepted. Saying they think a hotel-condo is a condo in disguise, CRG representatives have repeatedly said they could accept the city promoting new tourist development only if it involved a high-end, name-brand resort.

Moore said he and his finance partner, Starwood Capital, affiliated with Starwood Hotels and Resorts Worldwide, are preparing the project under the hotel-condo concept because it is hard to find conventional financing for resorts, which is why the hotel-condo concept has become so popular in the last several years. The major vacation destinations are now building resorts as hotel-condos, including properties in Miami, Colorado, Utah and Las Vegas, he said.

Media reports from around the country show that even the biggest hotel operators, like Starwood, Hilton, Four Seasons, Marriott and the Ritz-Carlton, are financing ventures with the hotel-condo concept. Part of St. Pete Beach's Tradewinds resort operates as a hotel-condo, and other examples of the model exist along Pinellas County's coastline.

Moore said his group's plans couldn't exist as a condo development under the city's regulations, existing or new. The city currently allows 15 units per acre for condos, 30 for a hotel. The Travelodge property is 5.6 acres and an adjoining parcel Moore is trying to buy is a little over 1 acre, which, combined, would allow 100 condos or 200 hotel units. The condo density limit would remain under the city's new plans, but the new regulations could allow a developer as many as 90 hotel units per acre if that developer abided by a host of city requirements for resort amenities, easements, compensation for infrastructure, affordable housing and aesthetic considerations.

"We're looking forward to working with the city and the community to bring a first-class development to market," Moore said. "We'd prefer that be a resort."

While well aware of the controversies surrounding the city's redevelopment efforts, Moore said he and his representatives have attended workshops and public meetings and realize that the city's plans are in flux. He said his group will build condos if the city's plans fall through, but he couldn't say how long he could wait to see what will happen. Crossgate is already developing the Madeira Bay condo complex in Madeira Beach.

Moore said the resort project is still fluid and that the improperly shared document is already out of date, though the general plan has been no secret because he has shown it at public meetings. He said he could not share details of the value of the resort, but said projects like this typically cost about $250-million. St. Pete Beach's total 2005 commercial property valuation is only about $400-million, so such a project would represent a significant influx to the tax base.

The document discusses Crossgate and Starwood Capital, which together formed St. Pete Partners LLC, but doesn't specify the resort management company for the final project. Moore said it might be Starwood Hotels and could represent a new brand under that company. Moore said the plan does not involve anyone in St. Pete Beach or vicinity except for attorney Don Mastry.

The project could not start until the city passed its new regulations. It would still take at least 12 to 18 months to complete, Moore said.

[Last modified September 28, 2005, 04:51:35]