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Real Estate Market Slows West Shore Makeover

Tribune photo by JAY NOLAN

One of three planned towers at Westshore Yacht Club is complete, but about 30 of its 80 condo units are unsold. WCI Communities has stopped building until its housing inventory shrinks.

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By SHANNON BEHNKEN, The Tampa Tribune

Published: November 19, 2007

Video: West Shore Construction

TAMPA - Sections of South West Shore Boulevard, lining the waterfront, look like an unfinished facelift.

New luxury condominiums are sandwiched between aging apartment complexes and low-income government housing. Cranes sit idle in the middle of construction zones, where thousands more new homes are planned.

But now that the real estate market has slowed, many of those plans won't happen. At least not anytime soon.

South West Shore Boulevard has some of the last large tracts of waterfront land in South Tampa available for redevelopment. City officials have said that the area will become a new gateway connecting Tampa and St. Petersburg via the Gandy Bridge.

Two years ago, when developers proposed the new projects, buyers from all over the world stepped forward with deposits. But when the market changed, many of those buyers canceled their contracts. As a result, some developers have halted construction. Some, who got started after the market turned, couldn't secure enough contracts to get financing and never started building. Other developers are hanging on to the land they purchased and waiting for the market to improve.

"We can't control the market cycles," said Mark Huey, the city's economic and urban development administrator. "Part of the overall planning at the city is to prepare for the next wave of private investment."

Developers of Casa Bella, a 13 1/2 acre site slated for 250 condos, sold 98 and decided this summer to return buyers' $6.5 million in deposits and change direction.

Developer Don Phillips, of Phillips Development, said the first of four buildings is complete, representing 40 units. He said he didn't want to deliver those units to buyers and end up with "a development that was half rental and half owner-occupied."

Phillips, whose company historically has built apartments, said the plans are now to operate Casa Bella as a rental community and finish building the development. When the market improves in two to five years, he said, perhaps the units will be sold then as condos.

"We were snorting the condo cocaine just like everyone else," Phillips said. "This kind of slowdown only happens every 15 years or so. It's a case of musical chairs. You just have to know where you're standing when the music stops."

South of Gandy Boulevard is the Westshore Yacht Club. It's further along than any of the other developments under way on West Shore, but the company is not starting construction on any more homes until it sells the rest of the completed ones.

WCI Communities, the developer building the yacht club, said this month that it is scaling back some of its Tampa Bay area projects until there's improvement in the real estate market.

The project is on 74 acres and initially included plans for 539 homes. One of the three planned towers is complete, and about 60 percent of the single-family homes and town homes are complete, said Jim Dietz, executive vice president and chief financial officer for the Bonita Springs-based company. The finished condo tower has 80 units, 30 of which have not sold.

The company is now concentrating on selling those homes, some at a reduced price. The other two towers are on hold until most of the existing inventory is sold.

At West Shore and Gandy Boulevard, the 54-acre proposed New Port Tampa Bay is on hold and the land is up for sale.

This month, the Tampa-based developer, EcoGroup, said it is halting plans to build condos and a marina on the waterfront site. The company has been unable to obtain financing because of lagging sales. The developer canceled more than $50 million in sales contracts and returned buyers' 20 percent deposits.

President Ed Oelschlaeger said the company is open to partnering with another developer or selling part of the land or selling the land all together. He said he wants his company to remain involved with redevelopment efforts and hopes that most of the original master plan will come to fruition.

The property is zoned for 1,750 residences and 240,000 square feet of commercial use. New Port originally called for 1,200 condominiums, a 300-slip marina, a park, shops and two restaurants near the foot of the Gandy Bridge, west of West Shore Boulevard.

"It's too attractive of a property for this not to occur," Oelschlaeger said. "This vision is good. The timing was just off."

The other big development planned for South West Shore Boulevard is on the site of the Georgetown Apartments, north of Gandy Boulevard.

Fort Lauderdale-based developer Motta Group recently vacated the property but still hasn't released its development plans. The brick buildings are empty, and gates to the development are locked.

Roy Paskow, principal with the development company, said plans are still in the early stages but that the company plans to move forward with some kind of residential development. He would not get specific on what those plans might include.

"Our expectation is that the market will improve before we're ready to go to market to sell," he said. "We think we have a very special location and a very unique project. We believe it will be a success."

Reporter Shannon Behnken can be reached at (813) 259-7804 or sbehnken@tampatrib.com.

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