An affordable housing project may be built on the former Playhouse Theatre property and adjacent land in the Grand Central District.
Tampa-based developer Blue Sky Communities plans to create the JR Tower at 1850 Central Avenue and 1833 1st Avenue S.
According to Blue Sky Communities executive vice president and partner Scott Macdonald, the 12-story project will feature 150 units and about 3,000 square feet of retail space. These homes would be reserved for families and individuals who earn 80% of the Area Median Income or less. Additionally, 23 units will be set aside for youth aging out of foster care.
The site is under contract. Macdonald and the Blue Sky team anticipate that the deal will close in early 2027. They hope to begin construction the same year. He added that it should take about two years to build.
“Over the last 10 years, the number of opportunities that we have seen to be able to build workforce or affordable housing in the core of St. Petersburg has been extremely few and far between,” he said. “The increase in real estate values on land and rent increases on the market rate side have made it cost prohibitive to even really look at anything in this area.”
Macdonald explained a new development on Central Avenue would allow more people to walk to work, grocery stores and restaurants.
“We really do have an affordability challenge here,” he added. “When you look at why that is, it has a lot to do with the run-up that we’ve seen in population inflow. What we have here that really exacerbates that problem is geographical challenges. We got water on three sides of us. So, we’re one of the densest cities in the state.”
Since the property is currently zoned as Corridor Commercial Traditional, it can only be used for mixed-use developments and smaller residential projects. A section of St. Petersburg’s municipal code, Chapter 17.5, allows developers to build affordable housing on some commercial and industrial zoned sites under certain conditions.
Amenities will include, Macdonald said, a fitness center, club room, library, computer lab and a rooftop terrace on the garage.
He added that the project will cost approximately $68 million. The Blue Sky team expects to receive funding through the federal tax credit equity program, a private bank loan, the Florida Housing Finance Corporation and the City of St. Petersburg’s Community Development Block Grant Disaster Recovery (CDBG-DR) program.
Blue Sky has been in talks with local nonprofit Ready for Life, which provides a variety of services for young adults aging out of the system, for a couple of years. One of the organization’s “main problems” is housing, Macdonald said. Often, Ready for Life has to pursue “one-off solutions” for each client. At the JR Tower, these young people will also be able to receive supportive services.
The Playhouse Theatre, initially built in 1925, was entertaining St. Petersburg residents and guests before the Vinoy and the Don CeSar were built. A movie house, the building witnessed the era of silent films before “talkies” emerged. However, by the 1960s, the theatre’s owners began to show “adult” films.
The property was purchased by a youth minister who turned it into a teen nightclub, Papa’s Dream, in 1974. Producers Bob Turoff and Ben Schrif would eventually acquire the building and it became the Golden Apple Dinner Theatre in 1981.
By the end of the decade, the Playhouse was once again rebranded as the Encore Dinner Theatre. The concept would only last for over a year. Additional projects, including a ballpark-themed cafe and martini bar, failed.
In 2016, investment company the Nahakama Group purchased the entire block and restored the Playhouse’s facade to make the property more appealing. The goal was to sell the site, which was never placed on the National Register of Historic Places.
Penncap LLC, a company created by St. Pete Urology physicians Dr. Reid Graves and Dr. Nicholas Laryngakis, acquired the Playhouse, a smaller venue (at 1833 1st Avenue S.) and two additional vacant lots for over $2 million in 2021.
Blue Sky Communities has worked on a variety of St. Petersburg projects. The company is behind the 85-unit Bear Creek Commons, at 635 64th Street S., which was designed to provide affordable housing to seniors. The development was completed in 2024.
Additionally, the organization helped create SkyWay Lofts. The complex, at 3900 and 3800 34th Street S., initially opened in 2022. A second phase, SkyWay Lofts II, began to welcome residents in January.
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