DUNEDIN – A 4.1-acre parcel in a location that’s prime for development in Dunedin continues to remain vacant, to the frustration of city officials.
Nevertheless, Dunedin Commissioners say the best course of action is to continue working with Pizzuti Companies, which owns more than half of the property, known as the Gateway tract, and plans to build a mixed-use project. The property is at Main Street and Milwaukee Avenue.
City commissioners voted unanimously Aug. 7 to extend a development agreement with the Pizzuti Companies to April 15 of next year in hopes that it will find a partner and secure financing for the project.
“We’re all just frustrated that nothing’s going on because we do see how successful this would be,” Mayor Dave Eggers said at the Aug. 7 commission meeting.
The Pizzuti Companies was chosen as the city’s preferred developer in February 2007. Since 2007, the overall declining economy and the poor real estate market forced the company to propose acquiring the Gateway tract in two phases, city officials said
Pizzuti prepared site plans and architectural renderings for an urban mixed-use project in 2012 and 2013. Commissioners approved the site plan, featuring 124 rental apartments and 24,000 square feet of commercial space, along with a development at their Sept. 12, 2013, meeting.
Securing funding has been difficult for the development, city officials said. Lenders criteria have become more stringent, the Gateway project is considered new, and there is no existing rental market project with which it can be compared.
Staff recommended the extension of the agreement. Without the ability to have complete ownership of the Gateway land, it would most likely take years for one owner to control all of the land and move forward with a development. The current development agreement with Pizzuti would have to be formally terminated, and the cost to the city to acquire the property owned by Pizzuti would be expensive, City Manager Rob DiSpirito said.
“The combination of the general real estate climate improving and the growing sense that developing downtown apartments is a great investment bodes well for the Gateway. Staff concludes that the option of not granting an extension for construction is not viable,” DiSpirito said
Pizzuti is seeking a development partner familiar with Dunedin. A local partner that knows Dunedin would understand the area market better than Pizzuti, which is based in Ohio, and be able to consider the dynamics of downtown in the development of rental analysis, DiSpirito said.
Jim Russell, executive vice president and chief operating officer, thanked the commission for having patience, saying his company has been “focused on trying to find the right solution.”
The company is seeking a local partner “who has enough expertise here to say to a lender, as a partner: Look, we’re here, we know what’s happening …,” Russell said.
Over the last six months, staff has met numerous times with Pizzuti executives regarding the goal of initiating the Gateway project. The meetings included a discussion of a recent market analysis on the feasibility of planned apartments on the Gateway, as well as securing financing for the overall project.
Commissioner Julie Scales said she would rather grant an extension than go “back to zero and who knows where we will end up five years from now.”
“No one would have wished for this economy that we had,” she said. “I certainly would be willing to be patient. You can’t will something when none of the other players are coming into it. I have the confidence in the project that you do.”
Commissioner Julie Ward Bujalski said she feels frustrated and doesn’t have a lot of decisions she can make.
“And I don’t like being in that position,” she said.
Commissioners want the project to be successful, Bujalski said.
“I feel as a commissioner my hands are kind of tied. Because you own part of the property and we own part of the property,” she said. “And to try to untangle that relationship is going to add even more years.”
Eggers had hoped that the project would be started before he leaves office in November. The excuses need to go away, he said.
“You guys have made the investment. You guys have made the plan. I just encourage you to work hard on this because I really think you got something here,” Eggers said.