The Ongoing Struggle For Sustainable Florida Real Estate Development

The most recent issue of National Geographic includes a fascinating feature on U.S. coastlines. As the U.S. population and its demand for waterfront property grows, the nation’s coasts find themselves in a delicate ecological state. Nowhere is this more true than in the Florida housing market.

One of the article’s focal points is the St. Joe Company, a former paper-and-timber giant turned coastal real estate developer — one of the largest in the nation.

As Florida’s largest private landholder, St. Joe has decided to grow new housing communities instead of pine trees. With the first wave of baby boomers turning 60 in January, a trend of wealthy, healthy retirees has officially begun. That suits Peter Rummell, the 60-year old head of St. Joe, just fine.

“We think there are enormous numbers of people getting to my age who have flexibility in their lifestyles,” he said. “They’re not staying in Cincinnati 12 months of the year. They’re looking for warmer climates, particularly Florida. It’s a proven track record for 75 years.”

Jerry Ray, the company’s V.P. of Corporate Communications, added that 12 million people will be moving to Florida in the next quarter century. To meet that demand, Rummell is turning vast tracts of forested Florida real estate into resort developments, aimed at feeding the hearts and minds of wealthy, nature-loving, second-home buyers.

The multimillion-dollar question: How do you squeeze all those people into a pristine section of Florida without destroying the natural beauty that draws people to the area in the first place? According to Russell, it’s all part of his master plan.

St. Joe’s WaterColor resort, west of Panama City, prides itself on sustainable development. It features homes set far behind the sand dunes, amid natural areas replete with native Florida species, such as pines, palmettos, and bay magnolias. Biking and hiking trails sweep around a natural coastal lake, forming a buffer zone. The houses are built like quaint bomb shelters, designed in what the company calls “Cracker Modern,” where redneck Florida meets rich, tasteful Nantucket.

The concepts are simple, but relatively unique in the world of development. Everything in the community is walkable within a ten-minute stroll, with natural areas like the beach and lake protected and made into amenities. Such concepts were reinforced after Rummell took a tour of Mississippi beach towns devastated by Hurricane Katrina last year.

“It was apparent that the quality of new construction makes an enormous difference,” he said, noting that modern structures largely withstood damage while older homes and cottages were ruined.

With more than 300,000 acres of land within the state’s coastal zones, a nest egg of $4.5 billion, and plenty of political clout, St. Joe can do what other developers only dream about. In one section of Gulf County, the company is moving 13 miles of U.S. Highway 98, which runs through its land along the Gulf of Mexico, a few miles inland.

The public gets a new, flood-protected four lane and the longest shoreside bike trail in the state. St. Joe, which posted a rare revenue decline last month as the state’s housing market cools amidst rising Florida home loan rates, gets miles of secluded beachfront acreage.

Meanwhile, in Bay County, the company donated 4,000 of its acres to build a controversial regional airport to service future homeowners, while setting aside almost 10,000 acres as a conservation buffer zone around nearby West Bay, an important habitat for migratory songbirds such as scarlet tanagers and Kentucky warblers.

Yet not everyone is thrilled with St. Joe’s vision.

Environmental groups recently won a temporary injunction against the U.S. Army Corps of Engineers for granting the company an unprecedented permit to develop nearly 50,000 acres on the shores of three coastal bays that would destroy 1,500 acres of wetlands, despite the company’s promises to mitigate the loss by creating/enhancing wetlands elsewhere.

“Wetlands are not widgets,” says Melanie Shephardson, an attorney for the Natural Resources Defense Council, one of the groups that filed the suit. “They serve different functions. Just setting aside some acreage and buffers might sound good, but at the end of the day you have to make sure that these bays, with all their species diversity, are not going to be harmed.”

Rummell fumes when speaking of the injunction.

“There are still people scared of growth. But it gets back to our vision of what the world is going to look like in thirty years. I want this part of Florida to be a better version of itself,” he said. “It would be a shame if it got high-rised to death. I would declare success if, 10 years from now, someone says this looks like it should be here. In the Florida real estate world, that’s hard to do.”