Northpinellas: Resort rivals lock horns in legal battle royale

CLEARWATER -- Richard Gehring and Bill Kimpton sat at a picnic table last week in front of the 47-year-old Glass House Apartment Motel as families swaddled in beach towels walked by on S Gulfview Boulevard.

In their dreams, the developers said, they were relaxing at the future site of their Marriott Seashell Beach Resort's tony lobby or perhaps in its savory restaurant. A few floors above them, they could envision affluent tourists lounging by a rooftop pool, perched atop their imaginary building's Don CeSar-like, majestic architecture.

Yet, they needed only to look to the north, at the cluster of hotels owned by beach hotelier Tony Markopoulos, for their dreams to evaporate.

In the past two weeks, Markopoulos has launched an attack, temporarily freezing the Seashell plans. The barrage includes two lawsuits, one soon-to-be lawsuit, and one administrative appeal.

Local development attorneys say the litigation surely will delay, and possibly sink, the 250-room, $65-million Seashell resort recently approved by the City Commission.

"Maybe you should take a picture of us under that stop sign at Gulfview," Kimpton suggested as last week's hot afternoon sun beat down on him. "The thing is we're stopped."

Markopoulos' attorney, Gordon Schiff, insists his client was provoked to fire the legal challenges.

"His rights were run over," Schiff said last week. "He did everything he could in advance to ask the city to consider the problems. The proposed design of the Seashell hotel is bad for Tony's existing development, and bad for future development on his property."

But Gehring suggests Markopoulos has other motives. He said he thinks Markopoulos just wants to use the lawsuits as leverage to demand certain concessions that city officials have refused to give him to create his own rival resort.

"We're not the target of what's going on," Gehring said last week. "We're not a party in the issue. The issue is between the city and Markopoulos."

The squabble -- of a magnitude that many beach business owners say is unprecedented -- is causing people to take sides. But some people still are in denial.

"You want to know the truth, I can't believe it," said Charlie Siemon, the city's top redevelopment consultant, who has been working on attracting a major new resort to the beach for about four years."My view is that you can sue them forever, you can even defeat the Clearwater resort project, but none of it will ever get him what he wants."

The dispute began simmering at least two years ago, when the city tried to buy Markopoulos' Days Inn property just south of the roundabout to build a parking garage. A deal couldn't be negotiated.

Markopoulos began planning to create a new resort with more than 400 rooms on his 3 acres of property, including the Days Inn. It would be his crowning project, after about 30 years of slowly building up his wealth after immigrating to the United States from Greece as a young man with little to his name.

Markopoulos bid against Kimpton and acquired more land, the neighboring Spyglass Motel. He hired an Orlando-based design firm that had laid out sprawling Caribbean resorts. He invited city commissioners for private viewings of sketches.

City officials were blunt: They told Markopoulos his proposal, designed with a slim, towering wall of rooms, all with a gulf view, was too massive. They also rejected his proposal to close Gulfview Boulevard from Pier 60 to almost Third Street and move his resort onto the beach.

Siemon, the city's consultant, recalled Markopoulos' response was: "You don't respect me. I know what the hotel business is all about. And you should be happy that I want to do this for you."

Siemon said Markopoulos made it clear the city should close the road in front of his hotel "or I'm going to become your enemy."

"I always took it as a negotiating position, not as a line in the sand," Siemon said.

Kimpton, meanwhile, was taking the lead in the race, planning a huge new resort to be built at the Beach Place and Glass House motels, south of Markopoulos' property. Gehring, a former Dunedin city manager with a company called Prime Interests, became an investor and planner.

They got along well with city officials. Kimpton is a real estate attorney who has lived on the beach for years. Gehring's firm has consulted on major projects such as the redevelopment of the Channelside district in Tampa.

Siemon says he tried to stop the rivalry between the two hotel projects. He organized a meeting, a few weeks before the final approvals for the Seashell, to discuss Markopoulos' project with his architects. But 10 minutes into the meeting, Siemon recalled, Markopoulos ended it.

He remembers Markopoulos saying: "I don't want to participate in this anymore. I want the city to close the entire road in front of my property and let me have what I want. I want you to leave."

Schiff, Markopoulos' attorney, argues that through the many negotiations, the city and the Seashell's developers forced Markopoulos into an adversarial position by refusing to address problems with the Seashell plan.

Schiff, who has offices in Tampa, says the city and Seashell developers are criticizing Markopoulos now in "an effort to take people's eyes off the real issue, the problems with their project and the process. That's an old trick, and we've seen through it."

In about 150 pages of legal arguments, Schiff has presented a no-stone-unturned litany of arguments why the Seashell resort should not be allowed.

Among the claims: In approving the Marriott plan, the city permitted too large a development on too small a piece of property, where there are now only about 65 hotel rooms.

Another point was that the city finished negotiating the agreement to build the Seashell several hours before the second public hearing on the deal.

He argues that the city has put the cart before the horse in approving the agreement to allow the Seashell to be built -- before getting permission from the state and county to allow up to 250 hotel rooms on the property.

Several experts told the Times that the litigation is a serious game.

Besides the possibility that the Seashell's developers and the city could lose in court, construction will be delayed until at least late this summer.

As long as any litigation is in play, local real estate attorneys say lenders will be skittish about financing the project. If litigation drags on for months or years, a realistic possibility, Marriott International could lose interest in committing to the project.

"I believe it's a serious matter, and I believe they're treating it seriously," said Tim Johnson, a land-use attorney whose firm is the largest headquartered in Pinellas County. He predicted both sides could pay $200,000 to $300,000 in legal fees if the lawsuits go to trial.

Both sides have attempted out to sway public opinion in their favor, with representatives fanning out to lobby city officials, beach business owners and Times editors.

With many beach business owners hungry to see a large, upscale resort lift the beach's image, Markopoulos seems to be losing the PR battle.

Among those speaking out is Lou Piano, the president of the Clearwater Beach Chamber of Commerce, although the chamber finds itself in a "delicate position" since it has free office space in Markopoulos' Days Inn.

Piano said the chamber has decided that it wants to see the Seashell built. He added beach business owners are frustrated that they have been "tattooed" with the with image they are all a bunch of squabblers.

"It's happened to them so many times. They fight for something, and then it doesn't happen," Piano said. "Although we understand Tony's position, we definitely want the Marriott. We hope both parties can work it out and get what they want."

David Little, the real estate broker who helped Markopoulos acquire his properties, said Kimpton and Gehring seem to have turned public opinion against Markopoulos.

But Little thinks Markopoulos has not been treated fairly, with the city handing out incentives to the Seashell that may now not be available to Markopoulos. He noted that Markopoulos owns all his land, while Kimpton just has contracts to purchase the property for the Seashell.

"It surprises me that everybody is bad-mouthing Tony," Little said. "His property is in a key location, and he's getting treated like a second-class citizen by the city. If it comes to a decision between public opinion and the opinion of a court, I think that's more important in defense of property rights."

"This guy has fought all his life to get where he is," Little said. "He's not going to give up easily."

Ken Rosenow, who sold the Spyglass to Markopoulos, said that he can understand some of Markopoulos' frustration -- although he wants to see redevelopment happen on the beach.

"There's been a little bit of feeling up and down the beach that Mr. Siemon and the city, that they favored outside developers, and have not really worked with the local property owners," Rosenow said.

But Louie Anastasopoulos, who comes from the same area of Greece as Markopoulos, said he didn't like to see beach business owners suing the city.

"I would like to see more projects taking place," Anastasopoulos said, emphasizing he was trying not to take sides.

"It's about time that we have progress, like any other beach in Florida," Anastasopoulos said. "Really, I don't know yet why they went as far as they went, to go to the courts to settle it."

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