The disconnect between the genomic prediction of secondary metabolite biosynthetic potential and the observed laboratory production profile of microorganisms is well documented. While heterologous expression of biosynthetic gene clusters (BGCs) is often seen as a potential solution to bridge this gap, it is not immune to many challenges including impaired regulation, the inability to recruit essential building blocks, and transcriptional and/or translational silence of the biosynthetic genes. Here we report the discovery, cloning, refactoring, and heterologous expression of a cryptic hybrid phenazine-type BGC (spz) from the marine actinomycete Streptomyces sp. CNB-091. Overexpression of the engineered spz pathway resulted in increased production and chemical diversity of phenazine natural products belonging to the streptophenazine family, including bioactive members containing an unprecedented N-formylglycine attachment. An atypical discrete adenylation enzyme in the spz cluster is required to introduce the formylglycine moiety and represents a phylogenetically distinct class of adenylation proteins.