NEW PORT RICHEY — A deal under which the city would sell the Hacienda to private redevelopers could be signed within a month.
Father-and-son investors Yaakov Rosner and Abraham Rosner, of Florida Motel Inc., discussed options with city council members during a Tuesday night work session. They affirmed they would want ownership since they are prepared to put down $2 million now.
The council took no vote, so the matter will appear later on a regular council meeting agenda.
Council members want several restrictions if the city sells the 1920s-era Mediterranean-style building.
In 2004, the city bought the Hacienda for about $2.5 million at the height of the real estate boom, only to see its value plummet during the Great Recession and subsequently fail to significantly recover.
The Rosners have expressed eagerness to reopen the Hacienda as a boutique hotel within 18 months and make the property profitable within four years.
Five years to profitability is the yardstick that Mario Iezzoni, the city’s economic development manager, used in his Hacienda outline. Much of the same material was presented to the office of Gov. Rick Scott, who decided to keep $1 million in the fiscal 2015 state budget for the Hacienda project.
The renovated Hacienda likely would have 30 rooms, Iezzoni said. Room rates at first could range from $70 to $100 a night. Eventually the city could gain 37 full-time, permanent jobs.
To help get the hotel off the ground, the city could forgo collecting property taxes for the first three years of operation of Hacienda and then offer tax breaks for two more years, Iezzoni said. The city has not collected any taxes from the property for 15 years. With a current ad valorem of about $1.1 million, Hacienda would generate $10,000 in city tax revenue.
Hospitality events would serve a critical role in making the Hacienda profitable, Iezzoni emphasized. Weddings, proms and banquets once again might fill the Hacienda’s halls.
A parking variance would help with overflow guest parking at the downtown hotel.
Yaakov Rosner said period furnishings could pose challenges. Council members want to retain the flavor of the 1920s era for the main lobby. While Yaakov Rosner said he usually confines himself to financial matters, he enjoys antique collecting and might help furnish the Hacienda.
Abraham Rosner said his firm anticipates budget overruns and maintains sufficient reserves.
Florida Motel renovated a hotel in Yulee, north of Jacksonville, and hired local workers for the project. Abraham Rosner lived nearby until the Yulee project was completed.
The Hacienda’s roof is a concern, Abraham Rosner said. And it remains to be seen if the original flooring can be salvaged.
Guests will expect many amenities at a reopened Hacienda, Councilwoman Judy Debella Thomas said. She used as an example the St. Francis Inn bed and breakfast in St. Augustine.
Speaking by remote over a Skype connection, Councilman Chopper Davis wondered if the Rosners “could live with” the relatively low room rates comparable to existing hotels in the area.
Yaakov Rosner said he wants to make rooms affordable, especially in the early years. Even if rates go up later, Florida Motel Inc. might offer discounts to New Port Richey residents to stay overnight.
Mayor Rob Marlowe said he and his wife Carolyn had mentioned it would be fun to stay at the Hacienda. He imagines other residents would feel the same way.
“Time is of the essence,” Councilman Bill Phillips said, speaking via telephone conference call.
Councilman Jeff Starkey said he had liked one part of Legacy Lodging’s proposal — to try to hire a management firm well known for running scores of boutique hotels.
The Rosners said they intend to reach out to a similar management firm, Autograph Collection by Marriott, to operate the Hacienda.
“That’s extremely encouraging,” Starkey responded.
City officials want some strings attached to any deal to sell the Hacienda.
Topping the list of possible covenants would be a reversion of the Hacienda to city ownership should a developer for whatever reason have to bow out of the project.
Marlowe said he wants a restriction against the Hacienda ever being used again as an adult congregate living facility. The nonprofit and nonsectarian St. Petersburg-based Gulfcoast Jewish Family & Community Services operated an ACLF for people with chronic mental health problems in the building for decades.
Thomas suggested a specific restriction to prevent the Hacienda from ever being torn down.