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'Condo-Converter'
By Gaurav Ghose
Staff Writer
For more than 20 years, Gus Di Giovanni has been a developer in the Clearwater-St. Petersburg area, acquiring land, building, buying and selling hotels. At one time, he owned as many as 17 hotels along U.S. Highway 19 and Gulf-to-Bay Boulevard. He now owns only three - the prominent one being the 205-room, four-star Radisson Hotel and Conference Center on Roosevelt Boulevard.
In the past three years, Di Giovanni, president of Di Giovanni Development LLC, has changed his focus to cater to the growing demand for waterfront homes, which he says are "hot" properties.
And as in the past, he continues to buy motels, but for an entirely different purpose.
He buys older, smaller motels and property in and around Clearwater Beach to build upscale town homes and condos. In his latest acquisition, he paid $2.55 million for the Tropical Breeze motel at 333 Hamden Drive. In about eight to 10 months, the motel will be razed to make way for 13 luxury condominiums. It will be Di Giovanni's first independent condo project at Clearwater Beach.
The pace of such conversions has been brisk along Florida's West Coast over the past few years. And Di Giovanni is among the area's growing number of real estate developers, including Rogers Beach Development and Sun West Palms, that have come to be known as "condo-converters."
Aware of the concerns raised from the fallout of rapidly vanishing beach hotels that, in the long run, could adversely affect tourism in Pinellas County, he says his turn toward condo conversions should not be construed to mean he has turned his back on building hotels.
But Clearwater government, he says, refuses to grant the proper density for hotels, given the price of property.
"Density is so low," Di Giovanni says. "For an acre of land you pay $7 million. What are you going to do with a 40-room motel? Give me 200-300 rooms and we can talk. Then there will be more motels."
Last year, the market was especially good, he says. In his short run of three years, he has built and sold four town home communities.
Bayway Townhomes was his best deal of last year, he says. Eleven units were sold for a total price of $7 million.
Companywide, sales revenue in 2004 was between $20 million to $25 million, he says.
This year, so far, he's building two upscale town home projects, called Harborside and Villa del Sol, valued at $4 million each, and a $16 million luxury condo project, called Brightwater Point, on which he is partnering with fellow real estate developer Roland Rogers of Rogers Beach Development. He expects sales this year to be similar to 2004, but prices will be a bit higher.
Di Giovanni, 57, has come a long way from his early teenage years in Italy where at a night school he took his first lessons in building techniques.
And his journey to the U.S. had a detour: Toronto and Windsor in Canada, where he joined his uncle Gus Mennas and his family as a teenager. For 14 years, he worked constructing high rises.
He and Mennas built five or six houses in their spare time.
"He was working for some one else," he says. "I was working for someone, but we worked part time and built these homes."
That's when he started dreaming of making it big on his own in the U.S. and he began English lessons. His uncle left the cold climes of Canada for Clearwater and Di Giovanni joined him in 1978.
He has been building hotels ever since, the first few years collaborating with his uncle and then going on his own. Over the past two decades, he has bought, built, owned and sold hotels/motels in Clearwater-St. Petersburg.
His business is a family affair.
His core group of investors includes four or five of his relatives - brothers and sisters - who live in Canada. His nephew Dave Di Giovanni, of Clearwater Beach, has invested in a couple of projects and oversees some of them. Only one investor, he adds, is not a relation, but he's an Italian-American friend, one of his early acquaintances.
He attributes his success to a "simple" business strategy. "I buy the land, I put the building up, I sell it and go to the next one," Di Giovanni says.
And along the way, he relies on people with whom he has worked for a number of years. Whether it is the brokers, who mostly bring him the offers of sale of an existing motel or hotel on which a condo or a town home could be built, or the architect or the subcontractors who work on the buildings he constructs.
What does he look for in selecting a property? Location, the number of units and what the units will bring in the market. Most properties, he turns down.
Georgette Gillis, of Viewpoint Realty International Co., has worked with Di Giovanni for three years.
"It all comes down to square footage price of the land and square footage size and price of the product," says Gillis, a Clearwater Beach Realtor for 23 years. "And Gus does his homework. He is ethical, straightforward and he does a good job."
Gillis says he considers Di Giovanni the top developer in the category of the product size he delivers - units that cost between $600,000 and $1,500,000.
Di Giovanni supervises each aspect of the construction process - foundation, blocks, framing, windows and interiors. He has three regular employees.
Patti Stough, his architect, says Di Giovanni's skills are obvious. "He is a hands-on craftsman, he is a carpenter, he can do ceramic tiles, he built his house with his own hands," she says.
In January 2002, Stough got a call from Di Giovanni to design his new town homes. As one who wants the highest and best use of the property, Stough says, Di Giovanni is exact "down to the fourth of an inch. His ideas are fabulous."
Rogers, an independent real estate developer, who is partnering with him on the Brightwater Point condo project, agrees. He says Di Giovanni's hands-on style means he puts out a good product on time.
Though Di Giovanni is Italian, his style is usually Mediterranean. He favors barrel roof tiles. But Stough says he is "acquiescing reluctantly" to her latest offer of Art Deco of Miami design for 13 luxury condos on 333 Hamden Drive. Twelve units would be 1,800 square feet and the 13th floor penthouse would be 3,600 square feet.
"He knows how to supervise," Stough says. "His work ethic is unbelievable. He is on every job site. If I am his hand on the drawing board, he is the hand in the field."
John Conti, a friend, fellow Italian immigrant and business partner, says: "He is probably the hardest worker you'll ever see. He is into the developing side, and I am into running and management of these places."
Some of the subcontractors, Di Giovanni says, have worked with him for more than a decade; some even have been associated with him since his first days in Pinellas.
As for Di Giovanni's firm size, he's not looking for fast growth.
"I don't intend to be Donald Trump or anything like that," he says.
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