When New York billionaire John Catsimatidis emerged as the buyer for a coveted block in St. Petersburg occupied by a crumbling garage and the old Pheil Hotel, reports described the price as “above $15 million.”
But the Business Observer has learned that Catsimatidis' Red Apple Group is actually forking over $18 million for the 2.23-acre tract, comprising the entire 400 block of Central Avenue in downtown.
If that price holds when the deal closes as is expected at the end of the year, Red Apple's purchase price would exceed the $17.25 million Kolter Group paid for a similarly sized parcel in 2014.
Kolter, developer of the Vue Sarasota Bay twin towers, is constructing One St. Peterburg on the site, a mixed-use high-rise of 41 stories that will contains more than 250 upscale condominiums and a 174-room Hyatt Hotel. That project is slated for completion in 2018.
Catsimatidis, in a telephone conversation from his offices in New York, declined to comment on the block's purchase price, citing a confidentiality clause in his purchase contract.
Mark Stroud, the broker who negotiated the sale, told news outlets the price “exceeded” the $15 million sought initially, but he declined to specify further.
The block's buildings, which have been vacant save for a three-story parking garage since 2006, were considered one of the most prized redevelopment sites along the Gulf Coast.
Stroud said he received more than a dozen written offers from qualified buyers.
The block had been long derelict stemming from a land lease dispute between two different owners.
Catsimatidis says his firm is studying the site and the market now to determine the best mix of uses for the Central Avenue block, but it would likely contain a hotel, offices and residences.
“We're considering all potential uses now,” he says. “We're starting from a proposition of one-third hotel, one-third offices and one-third condominiums, and we'll adjust those numbers going forward based on the needs of the city.”
Demolition, one of the conditions required for closing the sale, is expected to begin at the site within the next few weeks.
Though Catsimatidis' company, which generates about $5 billion in annual sales, is best known for operating the Gristedes grocery chain -- Manhattan's largest — a string of convenience stores and United Refinery, an oil production concern, Red Apple is no stranger to real estate development.
In Brooklyn, New York, Red Apple has constructed a trio of mixed-use projects, according to the company's website, and is working on a fourth now.
The Andrea, completed in 2010, contains 95 apartments and 22,000 square feet of retail space. The Giovanni followed five years later, with 205 apartments and 12,000 square feet of retail. The 15-story structure was delivered in 2015.
The Margo, with 228 apartments and 11,000 square feet of retail space, is wrapping up this summer.
At 86 Fleet Place, also in Brooklyn, Red Apple is currently building its most ambitious tower yet, a 33-story high-rise with 440 units. It is expected to be completed next year.