It’s a project that might sound familiar to folks in St. Petersburg: A sprawling, multi-billion-dollar mixed-use development with ample public space, more than a million square feet of office and retail, and thousands of new residences.
The developer, Hines, has promised a chunk of that housing will be designated affordable, leading to a pledge of millions in public funding as construction unfolds over the next decade-plus.
But this isn’t the Historic Gas Plant District, the ballpark and redevelopment project pitched by Hines and the Tampa Bay Rays Rays to remake St. Petersburg’s 86-acre Tropicana Field site.
It’s Riverwalk San Diego, a 200-acre development that will eventually replace a public golf course in the city’s Mission Valley neighborhood.
After years of deliberation, the project was approved in 2020, and broke ground in 2022.
And as of this month, it’s on hold.
Hines on May 10 announced that after completing an initial round of infrastructure work, it’s stopping construction on Riverwalk San Diego until “permits are approved and financing is finalized.” The developer is waiting for economic market conditions to improve before starting back up, according to the San Diego Union-Tribune.
That pause caught the attention of stadium skeptics in St. Petersburg, where the City Council is considering a proposed deal to commit some $700 million over a specific timeline toward Hines’ Gas Plant project.
“How do we have any assurance that they’re actually going to do the development anytime soon?” said Karyn Mueller of No Home Run, a St. Petersburg community group advocating for the city to negotiate better development terms. “We just need to make sure that we have assurances that the city’s expectations are actually going to be met.”
While the San Diego and St. Petersburg projects share similarities, Hines senior managing director Michael Harrison said they’re different enough that “you’re not comparing an apple to an apple.”
Hines is building the Riverwalk on the site of a golf course that is privately owned but open to the public. The landowners are partners on the project, as is an outside capital partner. While seeking city approval, developers outlined a construction timeline that would produce 4,300 homes by 2030, and a full build-out by 2035.
But as Riverwalk is a private project, Hines and its partners were under no contract with the city to deliver on that timeline. They did receive a $41.1 million state grant to build 190 affordable housing residences during its first phase of construction, which was originally slated to finish in 2025.
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The Historic Gas Plant District, on the other hand, is a public-private project with phasing spelled out in the proposed development agreement, and penalties if that timeline is not met.
“The city has some milestones that are drilled into our agreement that we have to meet,” Harrison said.
[ DIRK SHADD | Times ]
After completing Riverwalk San Diego’s infrastructure phase, the Hines group did not need city approval to pause and assess its finances. Harrison said costs had risen because of high interest rates and rising labor and materials costs, which are higher in California than in Florida.
In St. Petersburg, however, Hines and the Rays must provide proof of “irrevocable equity and/or loan commitments” from their financial partners before the infrastructure phase of development, according to the proposed agreement. In other words, the developers must have their funding locked in before the city hands over its share.
Hines could seek approval to pause Gas Plant construction based on what the agreement calls an “excusable development delay,” and there are some economic and market circumstances that could prompt that. But unlike in San Diego — where hitting the pause button was solely a developer decision — Hines and the Rays could claim an “excusable” delay only if certain metrics are met, such as proof of a leasing market downturn or a sharp decline in building applications filed with the city. In such cases, the developers would have to prove their case “to the…
Read More: Hines halted a $4B San Diego project. Could it happen in St. Petersburg?