ST. CROIX — A major redevelopment effort on the eastern edge of downtown Christiansted along Hospital Street inclusive of short- and long-term rental units, a fitness gym with a restaurant, a coffee shop, and possibly a boutique hotel continues gaining momentum as the developer and executive branch seek legislative approval to sell a government-owned residential property.
The pending sale of an abandoned house on Hospital Street that is owned by the government is another piece of the broader strategy to revive the historic district, expand housing, and strengthen St. Croix’s tourism product.
Peter Zielke, a retired technology entrepreneur who is now committed to developing real estate, has been revitalizing properties in downtown Christiansted for the past few years.
“Very quietly, Peter Zielke has been developing what I would like to call a Gallows Bay corridor,” Governor Albert Bryan Jr. said. “We’ve been in extensive talks with him over leasing and selling certain properties in order to create a more conducive path to Gallows Bay through Christiansted.”
Bryan said the vision includes an extension of the boardwalk from the eastern side of Fort Christiansvaern to Gallows Bay, housing units, and a fitness gym he described as one of the largest in the Virgin Islands — maybe in the Caribbean. He said Zielke is seeking government support for his projects primarily through permitting, land leasing, and property acquisition to complete the redevelopment footprint.
The area already includes several vacation rentals and long-term apartments in buildings and houses Zielke has renovated. The property Zielke is in the process of purchasing for $260,000, pending legislative approval, is a one-story house that sits abandoned and boarded up, with overgrown bush covering most of it from the view of passersby.
The 11,000-square-foot plot of land is next door to a brick building Zielke previously renovated, offering seven rental units that can easily be identified by the red roof and angel wing sculpture on the exterior. Across the street sits another building Zielke renovated into five rental units, featuring a mosaic wall art depicting two dancing women dressed in feathered carnival costumes. Zielke said his plan for the abandoned house is to renovate it into more long-term apartments.
“It ties in with my vision,” Zielke, owner of Z Property VI LLC, said. “People have to be able to walk to work and have affordable living, so it’s about creating a larger community on the street.”
After renovations, which will likely include the addition of a second story, Zielke said the house will largely match the aesthetics of its neighboring building.
“It’ll have a similar red roof and be very much still kind of tied into the historic Danish look,” he said.
The house is across the street from the shuttered outdoor Mexican restaurant La Bahia, which Zielke said is slated for a facelift that will include restoring some of the historic brick and enclosing part of the restaurant to create an air-conditioned space.
The existing rental units and Mexican restaurant are located down the street from a historic house Zielke renovated into four vacation rental units known as the “Mocko Jumbie House” for the life-size sculpture of three Mocko Jumbies in the front yard. Built in 1793 on the corner of Hospital and East streets next to the Virgin Islands Department of Education headquarters, the property was Zielke’s first restoration project in town. It has been a vacation rental for the past few years.
The “Mocko Jumbie House” is down the street from the “Tree House,” another structure Zielke renovated into three vacation rental units that preserves a cluster of three trees that grew into the building’s walls after Hurricane Hugo knocked it down in 1989. The trees are eloquently displayed as a prominent feature in the rental units as they are visible through the use of glass windows and ceilings. Tree roots are even growing inside one of the units.
“I’m trying to create more than just a place to stay,” Zielke said about his vacation rental units. “We’re trying to create something where people can come and can actually get a feel of the nature, of the culture of this island.”
While the “Mocko Jumbie House” and “Tree House” offer vacation rentals, Zielke stressed that most of his housing units offer long-term rentals.
“I really am also looking to have a community where locals can live in town and can walk to work and eat, can actually have a community that they enjoy as well,” he said.
Beyond housing, Zielke confirmed that a three-story fitness gym on the stretch of road that will feature a restaurant on the top floor is nearly complete and could open within the next two to three months. It is the building with a sculpture “in honor of the skilled hands and enduring spirit of the Caribbean stone craftsman, who transforms nature’s raw materials into timeless works of art, connecting our rich cultural heritage to the heart of our community.”
Artwork is a common theme among Zielke’s properties.
“I think art brings the community together,” he said.
An empty lot next to the gym has been identified by Zielke to construct a boutique hotel, but he said delays in permitting have raised doubt about the future of the project.
“I’m not going to say 100% certain it’s still happening, but I would say it’s still something that I am very much interested in doing,” he said.
Zielke is also renovating a building next door to Savant restaurant and across the street from the “Tree House” that will become a coffee shop, with his business offices upstairs.
As Zielke continues taking steps to revitalize the area by completing his existing renovation projects, he welcomes other developers to follow suit.
“My hope is that other people see everything that we’re doing and that they also start investing in Christiansted and then start making it a better place,” Zielke said.
The governor noted how Zielke’s projects complement the planned redevelopment of Hotel on the Cay, expansion of the boardwalk, transfer of the Gallows Bay cargo port facilities to the South Shore, and channel dredging in Gallows Bay to accommodate small cruise ships.
The governor also pointed out an effort by his administration to move more government workers into town, noting the recent relocation of the Office of Management and Budget and Department of Finance offices into a renovated historic building formerly occupied by International Private Bank. He also mentioned the government’s purchase of the old First Bank building on King Street, noting it will become the new home for the Office of the Lieutenant Governor.
As Zielke continues his development projects, ownership of the abandoned Hospital Street house would allow the next phase of his long-term housing project to proceed.
Bryan, in a December 5 transmittal letter to Senate President Milton Potter, requested the Legislature’s “prompt and favorable” consideration of the contract for the purchase and sale of the Hospital Street house. He indicated the proposed sale is justified on at least four grounds — the property’s current blighted condition poses a liability to both the government and surrounding community; the purchase price would provide a substantial financial return on an asset that has long yielded no benefit to the government; Z Property’s intended redevelopment aligns with broader revitalization goals for Christiansted and is expected to stimulate economic activity, create jobs, and enhance community aesthetics; and the property is not allocated for any current or future use, and is unsuited for the government’s real estate portfolio in its current condition.
Now that the contract to sell the Hospital Street property has been transmitted to the Legislature, a Committee on Budget, Appropriations and Finance meeting to vet the proposal is scheduled for 10 a.m. Monday.
