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City buys property to rebuild Midtown
By BRYAN GILMER, Times Staff Writer ST. PETERSBURG -- The two men in well-tailored suits draw stares as they cruise slowly in a maroon Ford Explorer over the major thoroughfares just south of downtown St. Petersburg: 16th, King, Fourth and 22nd streets; 18th and 22nd avenues. They scrutinize the vacant lots, the empty buildings, the boarded-up houses. And they envision new stores and offices, bustling with customers. How many lots would it take for a drugstore, and where's the best spot? What about a supermarket? A little kid on the sidewalk squints at the driver, then turns and shouts to his playmates, "Hey! There goes the mayor." Mayor Rick Baker and Deputy Mayor Goliath Davis III ("We don't see problems; we see opportunities") are not high-powered real estate developers hoping to turn a quick profit in the Midtown section of St. Petersburg. But they intend to recruit those developers, take them on the same drive and infect them with the same thoughts. And they have demonstrated that to turn their vision into reality, they are willing to invest millions of dollars in land. Taxpayers' dollars. St. Petersburg's city government has been buying land for years, just not in the poor, predominantly African-American neighborhoods Davis and Baker now have in their sights. In the late 1980s, St. Petersburg's city leaders looked around downtown and saw all sorts of ugly, aging buildings on tiny, separately owned lots. The city started buying them, one by one. It tore the buildings down to create large tracts ready for new construction. It cost millions of dollars. It took more than a decade. The cleared blocks stood empty for years. Part of one of the cleared downtown blocks remains vacant. But now some of the once-vacant land is filled with new developments. There are projects such as BayWalk and the Florencia condominium tower. Private developers are buying up other downtown properties and plan hotels, apartment complexes and other projects at no cost to the city government. Under Baker's predecessor, Mayor David Fischer, the city began buying homes and clearing land in Midtown. But those purchases were mostly for government projects. The city expanded the Wildwood Recreation Center and cleared space for a new library branch, for example. Under Baker, the city is buying land and hoping to sell it to a private developer for a huge project. It has bought more than 60 lots in a run-down triangle between I-275, Fifth Avenue S and 22nd Street. This month, it began tearing down the ramshackle houses, concrete block mechanic shops and service stations there. Roads and sidewalks also will disappear. Then the city will market a vacant 19-acre site called the Dome Industrial Park Pilot Project. The site will have interstate highway access and a fiber-optic connection to the Internet. The city hopes to lure a factory to employ hundreds of neighborhood residents in good-paying jobs with health insurance and retirement benefits. Davis and Baker call this buy, clear and sell process "flipping" land. The city stands to get only some of its money back in the near future. For example, the city has spent more than $3-million to buy the industrial park site and will likely be able to sell it for about $2.25-million, said Bruce Grimes, who buys and sells property for the city. Because the city used some money from the U.S. Department of Housing and Urban Development, it had to pay prices for some buildings that were many times their taxable assessed value. For example, the city paid $165,000 for commercial property at 618 22nd St. S, which was assessed in January 2000 at $32,500. The HUD rules demand that appraisers value the property the city is buying by comparing it with similar property outside the "blighted" area being redeveloped. That gives the person whose property is bought enough money to buy comparable property elsewhere. The city also has to pay the cost of relocating people. "It's HUD's money, so we'll follow their rules," Baker said. If property owners don't accept the city's appraised value for their property, city officials said, they could ask a judge to determine the property's value. The city would have to pay the legal fees for both the city and the landowner under Florida law, Baker said. He said the city will collect higher property taxes from the site for years if a multimillion-dollar factory is built there, and that the city stands to recover its investment many times over. To those in other parts of the city who might question spending the money, Baker makes this argument: "Unless we redevelop land like this and build new commercial property into the tax base, there's no way for us to reduce the tax burden for residential property owners." Davis says he wants to create "economic nodes" at intersections he and the mayor toured last week. "Someone outside there would say, "You just get into your car and drive to the closest (place with stores and services),' " Davis said. "But transportation is one of the issues we have to come to grips with in Midtown. Not everyone has a car." Like the Dome industrial site, the land along Midtown's major streets and avenues is a hodgepodge of ownership and zoning that Baker views as ripe for using the city's power to buy lots, assemble tracts and flip them. The City Council is considering whether to give Baker's administration greater power to buy land with future development in mind, a process it calls land banking. Baker and Davis won't say whether they have particular Midtown sites in mind for the city to buy and hold for private developers. Asked about the possibility, Baker said, "We might do that." The reason for their vague response: As soon as owners know the city is in the market, the price goes up.
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