Anyone who has experience with the 2008 housing crisis will know the pain that New Port Richey officials may soon face as they move toward approval of a deal to sell the Hacienda for $2 million (or less) after having purchased it for $2.21 million in 2004. The proposal is on the agenda for New Port Richey’s Council this evening, and the Mayor has said that it’s a big deal.

The problem inherent in the deal, however, is that the developers involved are foreign both to the City and to the United States, and only have one previous project under their belt–and it’s not even done. Not only that, but the City seems to be missing the mark on its revenue projections.

Council members were told last year that the project is financially viable when that may not be the case. City Economic Development Director Mario Iezzoni has projected revenue numbers for the project that NewsPortRichey has found to be up to 30% higher than you or I should probably expect.

Mr. Iezzoni based his projections on an occupancy rate of 71.4%, but NewsPortRichey received documents from Pasco County showing the actual current occupancy rates in Pasco to be between 57.40% and 60.1%. Mr. Iezzoni’s numbers show the proposed hotel making a very modest, even meager profit–my numbers show the hotel taking a substantial operating loss.

Mr. Iezzoni has disagreed with our assessment of his projections, but did not dispute the basis or facts of the argument. In response to my inquiry, Mr. Iezzoni said that the solution comes because the hotel is on the national historic register and he believes that will result in at least a 10% increase in occupancy. That seems like a lot of faith to go on, to me.

The developer in question is Abraham “Avi” Rosner and his father, Yaakov Rosner, both originally from Israel, has approached New Port Richey to propose an initial investment of $2 million in the Hacienda, on the condition that they be able to purchase the property.

Mr. Rosner has touted a previous hotel that he purchased in 2012 in Yulee, Florida as part of his resume for why the City should help him take on this project. In our investigations, NewsPortRichey found that the hotel has some issues, including multiple notices of subpar conditions.

Citing from documents obtained from the Florida Department of Professional Regulation (Division of Hotels and Restaurants), inspectors found dead bugs in rooms, mold, spider webs, soiled carpets, soiled towels, and soiled toilets on various visits. In a new round of documents filed since June 2014, further inspections were carried out and a consumer filed a complaint alleging that the hotel was serving food improperly without a license.

We spoke with that guest, a Ms. Patricia West, on the phone. She told us that she “absolutely would not” stay at the hotel in Yulee again if offered. She said that she thought it would be terrible if Mr. Rosner was to operate another hotel because he “can’t handle what he currently has.” “He drives a very nice car which he parks out front,” she said, “and it’s hard to think that he’s this young guy that has put everything into this hotel like he says.”

Unfortunately, Ms. West is not alone. Many reviews online for the hotel are negative–although there are some high ratings too (a couple of which were left by Mr. Rosner himself). Reviews aren’t the most reliable form of evaluation for a business, but there is a negative trend. Another issue is a stop work order is still currently in place from June 2014 on the renovation of the hotel’s pool.

Perhaps most concerning, the hotel in Yulee is  still currently only licensed to operate 23 rooms. Mr. Rosner has submitted documents to the City suggesting that he is operating more than 23 rooms and has insinuated that he is running a 100-room hotel. That is obviously not the case.

Mr. Rosner has, since June, come up with a proposal to hire a management firm to run the hotel instead of himself, but it is unlikely that such a move alone would be sufficient to overcome the managerial inexperience of the developer.

I believe that it is very likely that the City Council will unanimously approve the deal going forward tonight. I’d be surprised if I saw even a single dissenting vote. The Hacienda will be sold to the Rosners at an as-of-yet unknown price. The City already asked residents in a survey what they wanted with the property, and they overwhelmingly asked them not to sell it. That, of course, is nearly impossible at this stage–and the Council has no other option–but it seems irresponsible for me to give my blessing to a project that is very likely to fail.

If you would like to view any of the documents discussed in this article, feel free to contact NewsPortRichey and I would be happy to provide them to you.

by Jon Tietz