- July 23, 2026
Palm Coast leaders approved the sale of approximately 8.5 acres of city-owned land Tuesday, clearing the way for a proposed $31 million inpatient rehabilitation hospital that officials say will bring more than 100 high-paying jobs while expanding access to specialized health care.
The Palm Coast City Council, acting as the State Road 100 Community Redevelopment Agency Board unanimously approved the purchase and sale agreement with Sanders Trust LLC for the former Whispering Pines redevelopment site.
The proposed 36-bed hospital will be leased to and operated by ClearSky Health. According to the city, the project is expected to create more than 100 full-time jobs with an average annual salary of approximately $75,000, generate about $45 million in construction-related economic activity and eventually produce an estimated $310,000 annually in tax increment revenue for the State Road 100 Community Redevelopment Area through 2034.
While council members expressed strong support for the project itself, much of their discussion centered on protecting the city's investment if the development does not move forward as proposed.
Vice Mayor Theresa Pontieri asked staff to explore adding a "clawback" provision to the agreement that would require the developer to pay the full appraised value of the property if a substantially similar hospital is never built.
"It seems like we're kind of giving a break a little bit on the sales price because of what they're proposing to develop," Pontieri said. "If they don't propose to develop that ... that they pay the appraised value and not get a break on that price."
City Attorney Marcus Duffy said such a provision would require the agreement of both parties, while staff explained they had already pursued similar language during negotiations.
Pontieri said she supports the project but wants to ensure the city's discounted sale price remains tied to the promised investment.
Staff responded that Sanders Trust has already executed a 20-year lease with ClearSky Health that is contingent upon purchasing the property and constructing the hospital. They also said negotiations included commitments demonstrating the developer intends to move forward with the project.
Council member Ty Miller focused his questions on the final privately owned parcel within the redevelopment area, asking whether the remaining resident had been treated fairly and whether nearby businesses would continue to have access after construction.
Staff said Sanders Trust has agreed to provide moving assistance for the tenant and confirmed neighboring businesses, including AK Tires, will maintain access to their properties.
The redevelopment is the culmination of more than two decades of work within the State Road 100 Community Redevelopment Area.
The city and CRA began assembling the former Whispering Pines neighborhood in 2005, purchasing 22 residential lots, removing aging structures, wells and septic systems, and preparing the land for redevelopment. The city invested more than $3.16 million acquiring the properties during the height of the real estate market. Today, the assembled 8.5-acre site has an appraised value of approximately $2.8 million. Three development proposals were submitted, with Sanders Trust unanimously selected by the city's evaluation committee.
According to the city, the hospital will specialize in inpatient rehabilitation for patients recovering from strokes, heart attacks, brain and spinal cord injuries, orthopedic conditions, cancer and pulmonary illnesses.
Community Development Director John Zobler said in a city news release the project represents a major investment in Palm Coast's future.
"This is a tremendous win for Palm Coast residents and a strong example of City Council's commitment to creating high-quality jobs while strengthening our tax base," Zobler said. "This project turns previously blighted property into a major private investment that will expand access to specialized health care and generate revenue that can support continued improvements throughout the State Road 100 corridor."
ClearSky Health currently operates 16 inpatient rehabilitation hospitals nationwide, including facilities in Lecanto and Lake City.
Once the remaining private property acquisition is completed, the hospital project must still undergo Palm Coast's standard development review and permitting process before construction can begin.
