Safety Harbor Spa Bankruptcy affects City

Safety Harbor is a small quaint historical landmark to the Clearwater, Florida area dating back to the 1500's when it was habitated by Indian shell mound builders, Tocobaga and Seminole Indian tribes who believed the mineral springs had magical healing powers for the sick. When Spanish explorer Hernando De Soto reached the shores of now Old Tampa Bay and discovered the springs, he believed he found the fountain of youth and named them "Espiritu Santo Springs". During the Second World War (1850's) Colonel William J. Bailey purchased the springs and surrounding land from the government, making him the first owner of the springs after the US bought Florida from Spain. The land was called "Bailey by the Sea". Many other names derived for this wonderful find that hold great tales and in the 1900's Safety Harbor became known as the "Health Giving City" with five springs used for specific healing purposes.

This attracted visitors from all over bring a commercialism to the city for international business. Spring water was bottled in jugs and then shipped around the world. Thereafter in the 1920's the land and springs were sold to Captain James Tucker who developed and erected the Espiritu Santo Springs a/k/a The Safety Harbor Sanitorium, the Espiritu Santo Springs Hotel n/k/a The Harbor House. These developments set the Tuckers later into hardship with back taxes and the springs and sanitorium were sold to the Jansik family who restored the resort and added a pool that housed nothing but flowing spring waters. This attracted people from all over the country including a Pioneer of Naturopathic medicine, Dr. Salem Baranoff who in 1945 purchased the springs and sanitorium and visualized a true health spa resort with accomodations. From Dr. Baranoff's vision, word rang out and sports athletes, including professional boxers would come from all over to utilize the facility as a training camp and injury healing center. This later set the path in the 1960's for its recognition by the US Department of Interior and in 1964 it was designated a historical landmark, later to be a Florida Heritage Landmark.

This history proceeded to set the pathway of vision for future owners of the springs and sanatorium. Very wealthy visitors from afar would see this site as their home away from home for its tranquility and serene water views, mineral healing springs and small town lifestyle.

As time evolved, changes in the Clearwater tourism and lifestyles shifted the Spa's visitation. As the tourism to the spa decreased, the spa suffered in maintenance and upkeep. In 2004, a real estate developer purchased the spa with new ideas to regain its beauty and history to the new generation of visitors. It was the intention to demolish the historical landmark and build condos, shops, residences and a new spa in its place. However the community declined this intent pushing forward a full inspection of the buildings which resulted in a plan to renovate and remodel. The Spa was renovated in stages and during this new ownership has encountered various staff reassignments resulting in operational shortfalls, many guest complaints of black mold in the guest rooms, mildew odored hallways, bats in two of the guest towers and that the historical bottled water that was supposed to be from the healing springs, was later found to be nothing more than tap water. Complaints like these listed on travel agency websites and commendation for tourist destination sites caused demise to the Spa's memberships, spa services and guest stays and corporate decisions turned away many business conferences, weddings and events that would otherwise book years in advance. To date many of this issues have been corrected, but in the midst of doing so, the Spa experienced a financial hardship in maintaining their mortgage debt which is listed to be around $30 million not including the unsecured debt to trade creditors. At the same time, declining real estate values and business has not helped and the resort has had to attempt in restructuring their loan. On October 28, 2010 the Safety Harbor Resort and Spa filed Chapter 11 Bankruptcy Protection in an attempt to pay down the debt and keep the resort open until the market improves. Because of its National Landmark status this resort is an important part of the Safety Harbor community. Without the Resort, Safety Harbor would not otherwise be on the map so it wouldn't be surprising to see the City step in to assist this Historical Landmark keep its national status. The mortgage on the Resort includes undeveloped land surrounding the resort along the waterline. This land has declined in value and owners feel has affected the overall operation of the resort, so the City has proposed to purchase this property from the Resort as of June 30, 2011. Ongoing negotiations for land restrictions continue between the Safety Harbor Resort and the City of Safety Harbor and to date a the City has placed a deposit in escrow for purchase of $100,000 deposit pending an appraisal ($13,500)and survey ($6,000) of the property. All monies of which are coming from property taxes generated from the city's community redevelopment area. The city has presented an offer to the Resort for $3.3 million subject to the appraisal. If the appraisal is below their offer, both parties will renegotiate the terms. Within the Plan terms of the Chapter 11 Bankruptcy, the secured debt for the spa was to reduce the $30 million to just under $14 million. In the plan part of the land sale proceeds to the city will go towards reducing that debt.

Thus the legal matters, the Safety Harbor Resort and Spa continues to remain open for business and is honoring all reservations, spa services, etc. As we all know businesses alike all have suffered a great deal with our residential and commercial real estate value decline and rather than shunning away from contributing to a business in hardship, its important to embrace and assist because in the long run, these businesses are what continue to help our economy run and keep our housing values stabilize. And regardless of how the real estate market has been, it has not discontinued the overwhelming interest to purchase a home or open a business in this quaint city.

While the spa may have had some concerns in the past, it is handling them appropriately in the present and in doing so, hopefully we can continue to keep this beautiful landmark on the Historical Register for the future.

@Copyright 2011/HatfieldHomes

Information provided herein was obtained for this article from the following locations:
1. Safety Harbor Resort and Spa, History
2. St. Pete Times Article, October 29, 2010 -
3. St. Pete Times Article, June 30, 2011
4. St. Pete Times Article, August 17, 2011

Comments of guest services retrieved from Expedia, Trip Advisor and Safety Harbor Resort and Spa Comments.

HOMES AFFORDABLE PROGRAMS

In 2010 the HAFA and HAMP programs were implemented to assist a homeowner, where in turn many homeowner's were turned away and the programs became stagnate as no guidelines were in place. As of February 1, 2011 the government as re-implemented both programs with new rules and actual policies and procedures so we as real estate agents can assist our borrowers/homeowners better. If you are in a financial situation that may affect your homeownership, contact an agent today that is specialized in the HAFA, short sales and foreclosure arena. While we can not provide legal advice we can help guide you into starting the process to work with your lender so you can stay in your home and save your credit. We'll talk more about this subject in this month's ongoing blogs as information is made readily available.

FTC guidelines and HAFA restrictions may apply.