The state of the St. Pete economy: Fulfilling a promise of progress

The strength of St. Petersburg’s economy stems from innovation and diversity, and must continue to do so if the city hopes to fulfill its “promise of progress.”  Those were two of the major takeaways from the Mayor’s State of the Economy presentation at the Ark Innovation Center at 1101 Fourth Street South. 

The Mayor, introduced as an “architect of inclusive progress” by City Development Administrator James Corbett, spoke about how his administration prioritizes smart growth and inclusivity through five pillars for progress and then introduced several speakers who painted a picture of the optimism and energy of St. Pete’s economy.

Here are a few highlights from the afternoon:

Cathie Wood and Matt Silverman believe St. Pete’s future is bright

Cathie Wood, CEO of ARK Invest shared her belief that St. Petersburg could become a beacon for the world on “big ideas.” She spoke of her vision for St. Petersburg to host an event modeled loosely after Austin’s South by Southwest, but “turned on its head.” The St. Pete version would be “a time and place where people will come to learn how their lives are going to change” from the effects of five disruptive technologies: robotics, energy storage, artificial intelligence, block-chain technology, and multi-omics technology (that’s life-sciences to the lay person) 

Reminiscing about her excitement as a child at Disney Land’s Carousel of Progress exhibit, Wood said she would like to create “a Carousel of Progress moment for people to see how their lives truly are going to be transformed, and how important it is to get on the right side of change. Because the other side of disruptive innovation is creative destruction. If you’re stuck on the old way of doing things, you’re probably going to be on the wrong side of change.” 

Later, Matt Silverman, Co-president of the Tampa Bay Ray’s spoke of the Historic Gasplant District could be “the launching pad for so many people in our community.” If approved by the County and City Council, the project will become  “the largest development project in the history of the city, with upwards of eight million square feet of development.”  Silverman said that the project “can deliver on economic promises made decades ago. It will be a massive job creator through construction jobs and permanent jobs, and with new office buildings, hotels, and shops there will be activations on a daily basis, whether there’s a baseball game or not.” He went on to note that “there will be nearly two decades of work until the Gas Plant District is fully built out. That’s 20 years for individuals and businesses to gain experience, build capacity, grow, and flourish.”

Silverman also spoke about housing as an important component of the project, with upwards of 10,000 people eventually calling the area home. He noted that “the project will have affordable and market rate housing on the site, but will also create additional affordable housing in other areas of the city and fund $15 million into the city’s housing for all program. When complete, 70 acres of asphalt will be converted into a thriving neighborhood, one that actually generates property taxes.” 

Highlights of City Administrators

The afternoon’s program also included several city administrators who provided insightful statistics and examples that gave a clear picture of the state of the city’s economy. 

Key takeaways from those speakers:

Brian Caper, Director of Economic and Workforce Development: 

• Pinellas County’s population growth is driven by St. Petersburg: Since 2020, Pinellas County has gained 15,582 residents, and St. Petersburg accounts for nearly half of that, 48% to be precise, with nearly 7,500 new residents since 2020.  Caper notes that this demonstrates that “St. Petersburg continues to be one of the primary economic drivers for, not only the county but the region as well.”
• The bulk of employment is downtown and the Gateway/Carillon area, but the city is focused on expanding that to the South St. Petersburg CRA along with some of the major commercial corridors throughout the city.
• St. Petersburg has a lower unemployment rate than the region, the state, and the country (by nearly a full percent.)
• Raymond James and Associates is the largest employer in St. Petersburg, with Johns Hopkins All Childrens Hospital the second.
• Effectively, there is no office vacancy in downtown St. Petersburg. Rent per square foot for Class A office space is $31.65, but for a developer to invest in new office product, they seek rents that are closer to $70 per square foot. This highlights the need for public-private partnerships to create new office space downtown, like the Orange Station project and the Historic Gas Plant development. 
• There is an increase in office space vacancy in the Gateway area, but new businesses seem to want dense, walkable environments that provide ample residential, retail, food and beverage, and entertainment options.
• Retail vacancy in the city’s Mainstreet districts (Grand Central, The Edge, Deuces Live, and the Skyway Marina) is hovering around 8% and price per square foot has gone up by nearly $5 per square foot. 
• The city has been working with the Sugar Hill Group on a redevelopment plan for Tangerine Plaza in the Decues which is expected to go before City Council later this year, and the city is also preparing to release a Request for Proposals this summer for other city owned property in the Deuces, seeking to add retail, commercial, and residential opportunities. 
• The city has  added over 2,000 downtown dwelling units in the last five years, with another 1,645 units under construction, and 1,370 units in the pipeline. 
• Updates on programs like Housing Opportunities for All, Transportation and Mobility Improvements, and Workforce development initiatives were also discussed.

Tracey Smith, St. Petersburg Greenhouse Manager :

• The South St. Petersburg Microfund Program concluded its first cohort of 53 businesses with $455,000 of funding and there is an additional $1.5 million of funding available to continue microfund programming in 2024. The microfund program provides personalized capacity building through education, mentoring, and networking in exchange for CRA funding for targeted capital improvements. The grant portal for applications will reopen soon. 
• The Greenhouse will roll out a 3 year strategic plan and several innovative programs in 2024, including a technical assistance program for contract readiness in support of the city’s office of supplier diversity. 

Andrea Falvey, Economic Development Manager:

• The city held had its first ever supplier diversity day last October with more than 250 attendees. It was one of more than 60 events the office was engaged in last year.
• City has 283 certified small business enterprises, 36% of which identified as African American or hispanic owned. 
• The city’s small business enterprise fund in FY2023 was over $10 million.
• In October of last year, City Council approved the city’s new Minority and Women Owned business program. It is open exclusively to Pinellas County businesses and began accepting applications in January.

George Smith, Manager of the South St. Petersburg CRA:

• City’s 2023 taxable values were the highest on record, with $31 billion, a 12% increase since 2022. 
• Taxable value in the South St. Petersburg CRA (a 7.3 square mile district) was $1.98 billion, exceeding all initial expectations when the CRA was created in 2015.
• Largest tax payer in our area is Raymond James, followed by Camden USA. 
• Of the top ten taxpayers in the city, nine are residential properties. 
• Urban type developments such as Camden Central, Avanti, and Hermitage generate the largest amount of taxable value per acre.
• Construction values continue to boom, with over 33,000 permits issued and $1.3 billion spent in 2023.

The afternoon closed with the announcement of the Economic Impact Award, which went to Joe Zeoli, a recently retired 36 year employee of the City whose work had a major influence on in St. Petersburg’s recent renaissance. 

To view presentation in its entirety, visit here.

Photos courtesy of the City of St. Petersburg

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