Blue Sky Communities announced on May 6 plans to develop a 12-story, 150-unit affordable housing tower at the site of the former Playhouse Theater and Morph Nightclub properties in St. Pete’s Grand Central District. The Tampa-based developer has the 0.61-acre property at 1850 Central Avenue and 1833 1st Avenue South under contract for $6.25 million, with a deal expected to close in March 2027.
The proposal addresses ongoing challenges related to affordable and workforce housing near downtown St. Petersburg. “Getting affordable and workforce housing in downtown St. Pete is becoming increasingly difficult so this is an opportunity that doesn’t present itself often,” Blue Sky Communities Executive Vice President and CFO Scott Macdonald said in a conversation with St. Pete Rising.
Plans for the project, called JR Tower, include approximately 3,000 square feet of commercial space along with apartments designed for residents across several income levels: five units reserved for households earning as low as 22% of Area Median Income (AMI), additional units at higher AMI tiers up to workforce earners, and specific allocations for youth aging out of foster care. Macdonald said, “I hope it will alleviate a lot of the challenges this area is seeing for staffing businesses. Additionally, we are excited for the residents to be able to utilize the Bus Rapid Transit (BRT) as JR Tower will be a quarter of a mile from a BRT station.” The unit mix would feature both one-bedroom and two-bedroom apartments.
Blue Sky Communities intends to use Chapter 17.5 of St. Pete’s municipal code that allows certain affordable developments on commercially zoned land if long-term affordability requirements are met. The development cost is estimated at $53 million, with funding sought through tax credit equity, subordinate debt financing via Florida Housing Finance Corporation in June, and possible support from St. Petersburg’s Community Development Block Grant Disaster Recovery program.
If approved, JR Tower would replace the century-old Playhouse Theatre building—originally opened as Patio Theatre in 1925—which has seen various uses over decades but does not have historic designation today.
Construction could begin by late-2027 if planning proceeds as intended; completion is targeted by third quarter of 2029.
