$11.25 Million for 51 Low-Income Apartments: Was There a Better Way?
When the City approved the Azalea Gateway development in July 2023, the agreement allowed more than 1,000 apartments to be built on the former Raytheon property. It did not commit the City or County to financing the project.
The neighborhood’s opposition was unmistakable. Approximately 1,500 people signed a petition opposing the development, and “Azalea Against Apartments” signs appeared throughout Azalea and nearby neighborhoods. There was no comparable neighborhood campaign supporting the apartments.
At the time, residents were reminded that the City approves many developments that are never completed. An approval gives a developer permission to build, but it does not guarantee that the necessary private financing will be found.
That distinction became important in 2025.
Public Money Helped Move Phase 1 Forward
Porter Development later applied for government assistance for the first phase. Pinellas County approved $5.25 million, contingent upon the City approving another $6 million. The combined public commitment was $11.25 million.
County records show that the estimated $109.8 million Phase 1 budget was assembled from approximately $65.9 million in permanent debt, $32.2 million in developer and limited-partner equity, the City’s $6 million, the County’s $5.25 million and a sales-tax rebate. Together, those sources add up to the estimated project cost.
That financing structure strongly indicates that the public money filled the remaining gap needed to move Phase 1 forward. After years of delay, the project obtained financing and broke ground in 2026.
For residents, the result is difficult to accept. The neighborhood objected intensely to the size and density of this development. Then City and County officials committed $11.25 million in public money to help it proceed.
Many residents believe the eventual addition of approximately 2,000 people will increase traffic, place added pressure on public services and permanently change the character and quality of life of the surrounding neighborhoods. The project has already caused anger, anxiety and division before a single apartment has opened.
What Does the Public Receive?
Phase 1 contains 340 apartments:
51 apartments for households earning no more than 80 percent of area median income
51 apartments for households earning no more than 120 percent of area median income
238 market-rate apartments
There is a meaningful advantage to creating apartments that are specifically reserved for income-qualified households. The 51 apartments at or below 80 percent of AMI will not be available to higher-income applicants who could otherwise outbid or outcompete lower-income families for less expensive housing. Unlike general rental assistance, which may leave recipients searching in the open market, these restrictions preserve a defined supply of lower-rent apartments for qualifying households. That protection is a genuine public benefit and should be included when evaluating the financing, even while residents question whether the size of the subsidy is the most effective way to provide it.
The income-restricted apartments are expected to remain restricted for 50 years under the City agreement.
The $11.25 million finances the entire first phase, so it would not be accurate to say that every dollar is being paid directly for the 51 low-income apartments. Nevertheless, it is reasonable to ask how much assistance the public is providing and whether the same money could have produced a greater benefit for families with the greatest need.
If the public benefit is measured against the 51 apartments reserved for households at or below 80 percent of AMI, the combined City and County commitment equals approximately $220,588 for each low-income apartment.
Consider a different approach. If $11.25 million were invested in a housing-assistance fund earning an average of 2 percent annually above inflation, it could provide approximately $585 per month in inflation-adjusted assistance to 51 low-income households for 50 years. The payments would rise with inflation and the fund would be exhausted at the end of the 50-year period.
Alternatively, distributing only the investment earnings could provide approximately $368 per month in today’s dollars to 51 households indefinitely, while preserving the inflation-adjusted value of the original fund.
These are illustrations, not descriptions of the Azalea Cay financing agreement. They demonstrate why taxpayers should be allowed to compare this subsidy with other possible uses of affordable-housing money.
The Public Cost May Be Higher
The $11.25 million may not represent the full public cost. The City may also pay for road, parking or other infrastructure associated with the development. Those expenditures must be identified before they are added to the comparison, because some improvements may remain public assets or benefit the surrounding community.
It is also important to determine whether infrastructure spending is intended only for Phase 1 or for the entire three-phase development. If taxpayers finance improvements designed to support all three phases but only Phase 1 is completed, the public cost per finished apartment will be considerably higher.
We Are Not Giving Up
Phase 1 has broken ground, but many important decisions remain. Additional financing could be requested for Phase 1 or for Phases 2 and 3. Rising construction costs, interest rates and changing market conditions could produce further requests for public assistance.
Residents intend to follow those decisions closely. A proposed development committee will track public financing, environmental remediation, air quality, construction compliance, inspections, traffic, infrastructure and future government approvals.
The neighborhood may not be able to reverse what has already happened, but it can insist on accountability, document the effects of the development and oppose additional public subsidies. Residents intend to be organized and ready before the next funding request reaches City Council or the County Commission.
