Is St. Pete’s Tangerine Plaza saga nearing a conclusion?

The latest chapter in a seven-year quest to bring a grocer and economic revitalization to an area known for its lack of fresh food, retail and housing options ended on a positive note.

St. Petersburg’s City Council approved plans to transform the mostly abandoned Tangerine Plaza into a mixed-use development in a 5-3 vote Thursday afternoon. The Sugar Hill Group’s long-negotiated proposal includes affordable housing and a 3,000-square-foot grocery store.

The agreement gives the development team – who first sought to acquire the property in 2020 – 18 additional months to secure necessary funding and a formal commitment from a grocer. Rev. Louis Murphy, a local member of the Sugar Hill Group, pledged to effect a meaningful change within a two-mile radius of the embattled site at 1794 22^nd St. S.

“We’re going to make it happen,” Murphy said. “This is just the beginning. Those of you who didn’t vote for it, just know that we’re going to show you that we are more than capable of turning our community around.”

A rendering of the Sugar Hill Group’s proposed development. If negotiations are successful, a grocery market will occupy 3,000 square feet. Image provided.

The odds are not in the development team’s favor. While the federal terminology has evolved, the area was a designated food desert long before a Walmart Neighborhood Market shuttered in 2017.

The corporation left a gaping hole in the derelict plaza. It also has two years remaining on a $215,000 annual lease – more than double what Sugar Hill must eventually pay.

The plaza still bustles every Saturday morning as cars snake around its parking lot to receive groceries from Positive Impact Ministries. The local nonprofit, development firm Stoneweg US and former city councilmember Robert Blackmon have submitted all-cash offers for the property.

However, Mayor Ken Welch directed administrators to continue negotiations with Sugar Hill without considering those proposals. The development team submitted its latest and evolving proposal in June 2022.

Councilmember Gina Driscoll said the city has neglected proposals from organizations that have “heard what we need” and “don’t need a year-and-a-half to figure out how to find the money … I just don’t see how this is going to add up to something successful.”

“Sometimes you can just hope that things will come together, and I really did,” Driscoll added. “But I’m not seeing a path here, from everything that I’ve studied.”

Sugar Hill includes Murphy, senior pastor at Mt. Zion Progressive Ministry Baptist Church; Roy Binger, CEO of Binger Financial Services; and Oliver Gross, president of Miami-based New Urban Development. Murphy said the developers are in early discussions with Detwiler’s Farm Market, a faith-based grocer that closes on Sundays.

However, Murphy said Sugar Hill needs site control before formally negotiating a contract with any grocer. Like several council members, he credited Positive Impact’s work but said the area needs economic stimulation.

“We need to create foot traffic,” Murphy said. “We need to bring people who have a means to able to support what we’re trying to do in the overall revitalization of the Deuces (22^nd St. S. corridor).”

Driscoll noted that if negotiations with Detwiler’s are successful, the market wouldn’t open for another five years. Sugar Hill is only required to keep a grocer in the space for five years.

After meeting the initial terms, Sugar Hill would enter a $100,000 annual lease for 75 years. The city will waive payments for 24 months.

An overhead view of the Tangerine Plaza site. Screengrab, city documents.

The $37 million project includes 115 housing units and 10,000 square feet of total retail space. Current apartment income restrictions must average 80% of the area median income (AMI).

For example, city documents show 30 units at 120% AMI – $104,280 for a family of four in St. Petersburg. Monthly rents at those levels can reach $2,580.

The Live Local Act provides much-needed tax credits for units at 120% AMI. Murphy said the legislation could allow Sugar Hill “to do something even more robust.” The city-issued example shows 40 units at 80% AMI and 45 below 60%.

Once construction concludes, Sugar Hill could buy the property, independently valued at $1.84 million, for $1.5 million. Project funding is an ongoing issue.

The developers expect to receive affordable housing tax credits, private investments and gap financing subsidies from the city to see the project to fruition. Councilmember Ed Montanari noted they also listed $3 million from the South St. Pete Community Redevelopment Agency’s (CRA) budget.

George Smith, economic development manager for CRA, said it had not received a formal funding request or offered any support. Montanari also questioned why the same Sugar Hill document showed a $4 million request for Penny for Pinellas tax funding.

He did not receive a concrete answer.

Despite the delays and ongoing uncertainty, the proposal received support. Council Chair Deborah Figgs-Sanders stressed the importance of a Black development group and construction firms overseeing the project.

“My heart is with the fact that Sugar Hill has waited so long, and you have finally given them the opportunity … to make this happen for their community,” she said. “I am so happy we’re having this conversation to provide not only just economic and workforce development, but Black economic and workforce development.

“I have faith in you.”

Driscoll, Montanari and Councilmember Lisset Hanewicz voted against the proposal. Figgs-Sanders and Councilmembers Richie Floyd, Brandi Gabbard, Copley Gerdes and John Muhammad voted in favor of the agreement.