TAMPA - The painful housing market has claimed yet another condo project - at least for now.

There were great hopes that New Port Tampa Bay, a 54-acre, 1,200-unit waterfront development, would help revitalize South Tampa, south of Gandy Boulevard.

The developer, Tampa-based EcoGroup Inc., has been unable to obtain financing, however. Plans are now on hold and deposits have been returned to buyers, said Ed Oelschlaeger, president of the company.

More than $50 million in purchase contracts on two condo towers have been canceled. Buyers had put down 20 percent deposits.

New Port, at West Shore and Gandy boulevards, has been in the works for more than two years.

The project called for 1,200 condominiums, a 300-slip marina, a park, shops and two restaurants near the foot of the Gandy Bridge, west of West Shore Boulevard.

A key feature was keeping the waterfront open to the public.

Oelschlaeger said the company still wants to build but will redesign the units and lower the price range. He said it 'may be this time next year' before the new product is unveiled to the public.

'The master plan has not changed at this point,' he said. 'But we will be looking at that.'

Sales were launched in early 2006 at an elaborate party, which included a buffet, open bar and presentations by performers in the style of Cirque du Soleil.

At the time, the developer hoped the housing slowdown would not affect the luxury condo market. Prices for the first three residential towers originally ranged from $400,000 to more than $3 million.

The market, however, has changed dramatically, and it's much tougher now to secure a construction loan to build condos, Oelschlaeger said.

'I think the vision for the property was appropriate and I don't see that changing in any major way,' he said. 'But the market is what it is.'

Oelschlaeger said the new plans still will include the two condo towers, but plans will be scaled down, and the buildings won't be constructed at the same time.

The developer has completed a new seawall and installed underground drainage and utility work. Oelschlaeger said EcoGroup wants to finish the project, but it is looking into selling the land as part of a refinancing deal. In that event, Oelschlaeger said he hopes his company remains as the developer.

Admitting that the project is not working out was difficult to do, Oelschlaeger said, but he thinks it's the right thing to do currently.

'We weren't able to fulfill our commitment to buyers, and this became the appropriate thing to do,' Oelschlaeger said. 'It's a great site and we think it will eventually work out.'

Reporter Shannon Behnken can be reached at (813) 259-7804 or sbehnken@tampatrib.com.