Clearwater's revised downtown incentive thuds again, but not all are discouraged

An incentive for property owners will sunset this month with $520,493 the city could not give away. But two restaurants are poised to open soon, bringing hope to downtown.
Casual fine dining restaurant Roxy?s is set to open in June, which will be Michael Janecek?s third restaurant in Pinellas County. [TRACEY McMANUS | Times]
Casual fine dining restaurant Roxy?s is set to open in June, which will be Michael Janecek?s third restaurant in Pinellas County. [TRACEY McMANUS | Times]
Published April 19
Updated April 19

CLEARWATER — About 15 years ago, Michael Janecek eyed a restaurant space on St. Petersburg's then-quieter Beach Drive but missed out when another business beat him to the punch.

That space became Bella Brava, a favorite on the Beach Drive strip that has grown into a thriving cluster of trendy restaurants and bars over the past decade.

Now with his plan to open a casual fine dining restaurant in downtown Clearwater in June, Janecek is convinced this is his second chance to jump in early on a slumbering downtown's ascent to revitalization.

FROM 2018: One year later, Clearwater’s downtown incentive program brings no deals

Roxy's, with its tapas and handpicked wines, will neighbor the booming Clear Sky on Cleveland, which is going into its second year and is praised by city officials as proof of what is possible for surrounding vacant storefronts.

But getting a wave of businesses to invest in downtown's planned transformation continues to be a challenge, even with the city's latest incentive to give money to property owners able to secure a new restaurant or bar tenant.

Roxy's is the only recipient of the time-limited grant that ends this month because property owner Moises Agami was the only qualified applicant.

That will leave $520,493 in the fund the city could not give away.

• • •

The Community Redevelopment Agency created an incentive program to lure brew pubs and other anchor tenants in June 2017, but a year later, none of the 35 applicants had qualified for the $1.7 million available.

Director Amanda Thompson — who was hired in January 2018 after her predecessor and creator of the incentive, Seth Taylor, resigned three months earlier — was tasked last summer with rewriting the program altogether.

PREVIOUS COVERAGE: Prominent Scientologist buys up $16 million worth of downtown Clearwater property

In October, Thompson unveiled two time-limited programs for the $1.7 million incentive fund: one for property owners and one for tenants. In February, the city awarded $201,395 to four downtown businesses that were already open or under construction, ending the tenant portion. (In December the city retroactively granted Clear Sky $100,000 under the original rules, after debate whether the owner was promised funding by Taylor and never received it.)

The six landlords who prequalified for Thompson's property owner portion by the Nov. 30 deadline had until March 1 to secure a tenant that served food or drink on nights and weekends in order to get up to $250,000 for building upgrades.

Only one was able to: This week the City Council, acting as the Community Redevelopment Agency trustees, approved Agami's application for $250,000 to transform his storefront at 412 Cleveland St. from a former nail salon into a restaurant for Roxy's. Recipients must match the city's grant but do not have to repay the funds if the business stays open for five years.

Janecek said he signed an eight-year lease with Agami in July, three months before the new incentive was launched, and at the time wasn't sure if the city's failed 2017 incentive would be revised.

Owners of retail space at The Nolen apartments, Station Square apartments, the 500 block of Cleveland Street, and a vacant, former dry-cleaning building on Cleveland Street also applied but failed to secure tenants by the deadline. Brian Andrus, who co-owns an office tower anchored by KnowBe4, applied for funds to support the build-out of a coffee shop for his first floor but the council denied him the grant because the shop will not be open on nights and weekends.

Assistant City Manager Micah Maxwell said “perception issues” and “concerns about downtown generally as an unproven market” were top complaints from property owners unable to find tenants for the incentive.

Clearwater is dealing with a convergence of variables that makes its downtown like no other: the dominating footprint of the Church of Scientology, outdated retail spaces in need of expensive upgrades, a lack of synergy between property owners and the city, and the city's reputation as being overly complicated for business.

To help change perceptions the Community Redevelopment Agency launched new initiatives last year, including a public art campaign that brought half a dozen murals to downtown buildings, an effort to share “authentic, positive stories about downtown,” and a goal to lure 600 housing units and $100 million of private investment by March 2020.

PREVIOUS COVERAGE: Murals are latest attempt at change in Clearwater

But some said the structure of the incentive program was the problem. Kathy Panagoulias, who has owned property on the 500 block of Cleveland Street for 24 years, said she began negotiations with the owners of a Cuban restaurant in February but did not have enough time to secure a lease before the March 1 deadline. She said the city's requirement for property owners to post collateral is prohibitive. The grant is also paid on a reimbursement basis, not as seed money, which she said is less feasible.

Attorney Gino Megna, who is representing restaurateur Eric Diego de la Torre, said his client is still interested in Panagoulias’ space but would be more inclined to sign a lease with incentive funding available because “that place needs a lot of improvements.”

The council, acting as the Community Redevelopment Agency, is expected to vote in May on whether to extend the property owner incentive deadline to give the six pre-qualified owners more time to secure tenants.

But council member Jay Polglaze advocated for the incentive program to be rewritten again so the $520,493 remaining could be geared more toward tenants than landlords.

“It's that holding out the red carpet, the city of Clearwater saying 'yes, we want you,'” Polglaze said.

• • •

While sections of downtown are still hushed with empty buildings, other blocks are gaining momentum. Blackbrick Tavern and Kitchen is expected to open in late May on the same 400 block of Cleveland Street as Clear Sky and Roxy's. Tequila's Mexican Grille is also relocating to the block from its spot on Fort Harrison Avenue.

“I wouldn't be doing this if I didn't think the timing was right,” Janecek said about Roxy's. He has also owned Paradise Grills on Upham and Pass-a-Grille beaches for 11 years. “My bet is it is going to revitalize, it's going to keep developing and it's going to happen over the next three or four years.”

Blackbrick Tavern owner Bill LaGamba received $62,341 in the tenant incentive in February. But the restaurant was scheduled to open in summer 2018, before there was a revised incentive for him to apply for.

After the city approved his original building plans last year, he said an inspector later raised concern over a vent for a hood in the kitchen, causing him to make unexpected revisions.

LaGamba, who owns Surfside Taphouse on Clearwater Beach, said he sees downtown as the next frontier. He points to recent downtown apartments that will bring more foot traffic to the downtown core. He's cautiously optimistic about the Imagine Clearwater plan still in design to overhaul the 66-acre downtown waterfront.

It's now a matter of getting other investors to take the chance.

"I think it's possible," LaGamba said. ‘‘I put a lot of money in my business believing it's possible."

Contact Tracey McManus at tmcmanus@tampabay.com or (727) 445-4151. Follow @TroMcManus.

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