St. Joe real estate sales grind to near halt
Say it aint' so, (St.) Joe. That gasping sound you hear is the wheeze of once mighty real estate developer St. Joe Co. unveiling its anemic revenues for the first quarter of 2009.
For the three months of this year, revenues were $21.6 million, down from $116.6 million a year ago. Now let's look at the part of those revenues from real estate. Just $8.5 million in first quarter '09 versus $101.1 million a year earlier. Talk about falling off cliff.
It's sure another real estate world from my first trip in 2001 to see the Florida Panhandle land (complete with its own on-staff horticulturist) that would become St. Joe's signature "WaterColor" (in photo) seaside development.
Here's what St. Joe CEO Britt Greene volunteered in announcing St. Joe's quarterly performance: A remarkable sales deceleration, not to mention a first quarter loss of 11.7 million compared to a 32.1 million gain in the same quarter of '08:
"Although Northwest Florida’s" -- that's what St. Joe insists on calling the Panhandle -- "real estate markets remain challenging, our residential communities have seen a relatively modest improvement in traffic and sales activity since the end of last year.
“However, it is too early to predict a bottom or a trend. The actions we have taken, such as adjusting pricing for our inventory of homes, has helped us to respond to a market that seems interested but remains timid. We are also seeing measured activity in our commercial markets throughout the region.
"Our primary focus is on planning for the opportunities presented by the upcoming opening of the new Panama City – Bay County International Airport. The airport, centrally located within our key land assets, is scheduled to open in 2010.”
Ah yes, the new airport. The new one that never would have happened without St. Joe's donation of land and massive lobbying efforts to overcome opposition and see it through. It is this airport, after all -- capable of handling large jets, unlike its predecessor -- that remains a linchpin in the St. Joe strategy to provide easy access to the Panhandle real estate market to a larger volume of second home buyers and retirees. The old airport mostly handled prop planes hopping from such markets as nearby Atlanta or Birmingham.
As of March 31, St. Joe owned about 585,000 acres, concentrated primarily in the Panhandle, enough land to make the company one of the biggest (if not the biggest) private landowner in Florida. Some 405,000 of those acres, or 70 percent of the company's total land holdings, are within 15 miles of the coast of the Gulf of Mexico.
The thing to remember about St. Joe is this is a company that assembled much of its rural land by Alfred duPont in the Depression years for literally pennies per acre. The result? St. Joe owns outright most of its land so, unlike most Florida development companies, it is not in deep debt. That gives St. Joe a company's greatest gift in this recession.
(Photos courtesy of St. Joe.)
--Robert Trigaux, Times Business Columnist