Orange Beach - High Court Upholds Turquoise Ruling

As Published By The Mobile Press Register
Third and fourth towers clear legal challenge
Saturday, January 19, 2008
By RYAN DEZEMBERStaff Reporter

The Alabama Supreme Court has let stand a lower court's decision that gave developer Larry Wireman the green light to build the third and fourth towers of his Turquoise Place project in Orange Beach.
The high court offered no written reason, only noting in its Jan. 11 release of decisions that it would not consider the matter.
The owners of an adjacent hotel and the estate of former landowners brought the appeal, challenging last year's decision by the Court of Civil Appeals to side with a Baldwin County judge in favor of Wireman.
They claimed to own restrictive covenants that limited development to single-family homes on nine beach lots where Wireman planned his third and fourth Turquoise Place towers. And they sought to either block construction of the second pair of 300-foot-plus high-rises or extract millions of dollars from Wireman, who sued in 2004 to have the mid-century covenants dissolved.
Over three years of legal proceedings, Wireman argued that Orange Beach's Gulf-front has undergone dramatic change since the covenants were installed between 1955 and 1966 by landowners Carl T. and Jessie A. Martin. Restricting the 928-foot stretch of beach to residential dwellings would, he contended, put its owners at an economic disadvantage and ensure that they would have no choice but to keep small homes in the shadows of high-rises.
The defendants --the Island House Hotel; Sea Shell Inc., a company through which Bay Minette developer Thomas Mitchell owns half of the 11-story hotel; and the Martin Estate, which was represented by AmSouth Bank -- persisted in their efforts, however, to have the covenants upheld.
During a 2005 trial, Mitchell, who built a number of condo complexes at the beach, testified that in 1999 his company paid $25,000 for the restrictions over the two lots bordering the hotel's property in an effort to preserve the building's sunset view. The bank, which held restrictions over the other seven lots, argued that the Turquoise Place project would devalue property across Alabama 182 that the estate still owned.
At the time of the trial, Wireman said the defendants asked him to pay
$22 million to lift the restrictions. Lawyers for the hotel and estate said their clients would have taken $10 million, though.
Walter Cook, a Mobile attorney who represented the estate, declined this week to comment on the case.
"The Supreme Court has spoken," he said.
Robert Wills, the hotel's lawyer, was unavailable for comment last week. And Wireman's lawyer, Dan Blackburn, didn't respond to requests for comment.
For his part, Wireman said that though the legal hurdles have been cleared, he won't be starting construction of the third and fourth towers -- planned to be 27 and 33 stories -- "anytime soon" because of the slow resort real estate market.
"We've got to see what the owners are doing," Wireman said Thursday. "I've got a few days to close on the property. We just have to assess the situation and see what's going on."
During testimony in the 2005 trial, Wireman said he contracted to pay about $55,000 per Gulf-front foot to the owners of the nine lots. With each lot measuring about 100 feet, that meant each owner stood to collect around $5.5 million.
If he does build all four towers, Turquoise Place will include 882 luxury condo units that start at about $1.4 million and exceed $4 million in some cases.
The first two Turquoise Place buildings are well under way. The first -- a
$110 million, 24-story tower -- should be finished in April, while the second is scheduled to open next summer, he said.

Gulf Shores Luxury RV Lots Rise To Meet Latest Fad

As published by the Mobile Press Register
Monday, November 19, 2007
By RYAN DEZEMBERStaff Reporter

GULF SHORES -- There will soon be a steady procession of high-end recreational vehicles -- Simonized, half-million-dollar elephants with plasma televisions and granite countertops -- rolling along Sun Belt interstates, searching for a place by the beach to park.
Or so developers in south Baldwin County are betting.
On 40 acres off the Foley Beach Express, Sagebrush Realty Development is mulching trees and preparing to excavate an H-shaped fishing lake to be centerpiece of its 176-lot, full-service motor coach resort, Bella Terra. Around 4,000 square feet in a four-star setting will cost between $88,000 and $200,000.
Farther south, off Baldwin County 6, developers have asked the Baldwin County Planning & Zoning Commission to dice an irregular shaped 240 acres into 772 land-yacht lots and five lakes. The body postponed a vote on the project, called RV Resorts of America, on Thursday, and will likely decide its fate in a meeting next month. The developers asked for the delay, saying they've yet to address county planners' design concerns.
Orange Beach has also caught the motor coach fever.
On Tuesday, the Planning Commission vetted final plans for Buena Vista on the Beach, a 111-lot recreational vehicle resort on the north side of the beach highway. That project, proposed by a company with family ties to former HealthSouth CEO Richard Scrushy, would be a gated community with lots -- essentially 4,700-square-foot parking spaces with utilities and landscaping -- offered for around $350,000 and governed by strict covenants that allow only well-maintained, top-of-the-line motor coaches.
In May, the Planning Commission approved plans for the 79-lot Heritage Motor Coach Resort on 8.5 acres sandwiched between Canal Road and Terry Cove.
Orange Beach developers Jim Brown and Ken Wall, both of whom were convicted in 2006 of federal charges of bribing then-Mayor Steve Russo, were the trend's local pioneers.
They built a 47-lot motor coach resort on Canal Road in 2004, selling the lots for prices between $65,000 and $109,000. At the time, Brown, a motor coach enthusiast, told the Press-Register he was on his fifth bus, which featured a 43-inch plasma television, granite countertops, a stainless steel refrigerator, king-size bed, walk-in closet and Travertine tile floors.
The developers of these resort projects tend to use the terms motor coach and recreational vehicle interchangeably. Generally, what they are referring to are Type A motorhomes, bus-shaped vehicles in which the living quarters are accessible from the driver's area and which can cost anywhere from about $60,000 up, according to the Recreational Vehicle Industry Association.
The allure is a rising number of baby boomers seeking a life on the road paired with rising recreational vehicle purchases. The Recreational Vehicle Industry Association, a trade group, says recreational vehicle ownership will extend to 8.5 million households by 2010.
"We really perceive that we're insulated from the real estate industry's recession," said Trip Keber, Bella Terra's executive vice president for business development.
Hitting the road
So far Sagebrush has sold about 45 lots and many of the buyers -- well-heeled baby boomers shedding their homes and hitting the road -- paid cash, which has helped Bella Terra dodge the mortgage industry meltdown, Keber said. He envisions a circuit of Bella Terras along which unencumbered and moneyed retirees can "chase the seasons" from Portland, Ore., to Santa Fe, N.M., Scottsdale, Ariz., Gulf Shores and south Florida to Portland, Maine.
The popularity of recreational vehicles resorts has been noticed in local city halls, and planners said with home and condo sales badly slumping, it's not surprising to see developers trying something new. Some recreational vehicle resorts -- which are built faster and torn down easier than homes, shopping centers or condos, may even be an intermediate use until land values rise again.
"I kind of question whether we have too many on the market," said Orange Beach Community Development Director Jim Lawson.
The lifestyle is one of leisurely pursuit, and the lots -- not to mention the vehicles -- are expensive, he said: "You just wonder how many people like that there are."
Neither of the projects with a Gulf Shores address have been annexed into the city, but Community Development Director Steve Foote said this week that a developer floated the notion of building a motor coach resort on the Fort Morgan peninsula.
"They do seem to be popular now," Foote said. "It seems like everyone's jumping on the bandwagon."
The recreational vehicle parks in Gulf Shores are numerous but generally the traditional type in which travelers rent space, be it a for a summer weekend or a full season, Foote said. They also tend to accept a wider range of vehicles, from pull-behind folding campers to fifth wheels to self-propelled motor homes.
At Gulf State Park, for example, there are more than 500 recently renovated camp sites with power, water and sewer hookups. In the coming weeks those spots will fill with flocks of seasonal residents from the North.
About three blocks north of Gulf Shores' main public beach sits the Luxury RV Park overlooking a marsh and the state park. Down Fort Morgan Road is Bay Breeze RV Park, Doc's RV Park and Island Retreat RV Park. Others are along Alabama 59 and back roads throughout the southern part of Baldwin County.
But Gulf State Park doesn't have high-speed Internet access at each pad and concierge service. That's where the luxury comes in.
At Buena Vista each brick-paved and native landscaped lot will come with a gazebo and have shared use of a pool and walking trails. Bella Terra will feature a private movie theater, bocce courts, putting greens and Jacuzzis. Designs for the RV Resorts of America site, a city of motor coach slots, show swimming pools, restaurants and tennis courts.

Publix Super Market Coming to Orange Beach

As reported by Mobile Press Register:


Publix Super Market plans to open a 54,000-square-foot store this spring in Orange Beach's Shoppes at Palm Pointe at the northwest corner of Alabama 182 and 161, according to Ken Bailey of Brigham Williams Commer cial Properties in Birmingham. The store will anchor the 194,000-square-foot retail center, he said. The Lakeland, Fla.-based grocer has 28 stores in Alabama, though this will be the first in south Alabama.

Guy Harvey's Island Grill will open in April in the archway on the marina at The Wharf , a mixed-use development on the Intracoastal Waterway in Orange Beach, according to Jeff Rouzie of The Wharf. Guy Harvey, a marine-biologist-turned-wildlife artist, diver and photographer who lives in Grand Cayman, also will open a 5,650-square-foot Guy Harvey Art Gallery to the east of the 7,000-square-foot Island Grill, and on the west side, a 3,300-square-foot Harvey clothing store, according to Rouzie.

Gulf Shores - Envision Gulf Shores

Article as published by the Mobile Press Register

Wednesday, October 03, 2007
By RYAN DEZEMBERStaff Reporter

GULF SHORES -- With a sluggish demand for resort real estate, developer Shaul Zislin told the City Council that he plans to wait on building a mixed-use tower at the city's main public beach and put a restaurant there until the market improves.
Speaking to municipal officials at the council's Monday work session, Zislin said he still wants to erect the buildings that are central to the city's Envision Gulf Shores plan, but that it may be up to five years before the real estate market will support such an endeavor.
Envision Gulf Shores is a plan that aims to steer the redevelopment of the city's central Gulf-front into a pedestrian-friendly downtown with open spaces, hidden parking decks and shops and restaurants filling the bottom floors of condo and hotel towers.

Zislin, whose property sits at the city's main public beach at the terminus of Alabama 59, had planned to build a 32-story tower there with bottom floors filled with 90,000 square feet of retail and eateries, five levels of parking and upper floors holding 225 condo units.
Zislin said his market forecasts indicate that it could be four or five years before there are buyers for the condos in that plan, and in the meantime, he'll put a restaurant and bar on the site with a swimming pool and cabana area. Though specific plans for the restaurant have not yet been filed with the city, he said he wants to be open by March to cash in on the spring break crowds.
The site, a city block known as Gulf Place, formerly held a motel, jewelry shop, two restaurants and a pair of bars. Those businesses, largely wrecked by 2004's Hurricane Ivan, were torn down in 2005 after Zislin and his business partners, working as Beach Place Development LLC, purchased the land. It has sat empty since then.
Elected officials indicated that they were pleased to see something built at the city's focal point, though they said they hoped Zislin would move forward with his high-rise plans sooner rather than later.
"I'd much rather do the Envision plan," Zislin said. "I just need a buyer, or hundreds of buyers."
No matter how successful the restaurant may be, it won't provide enough to pay for the property and it won't be nearly as profitable as selling high-end condos, he said.
Probate Court records indicate that Beach Place Development LLC borrowed $13.1 million to buy the property from various owners in January 2005, though records indicate that the investors paid more for the various parcels than they financed.
"It's just putting Band-Aids on some wounds," Zislin said. "The minute there's going to be other opportunities there, it's a no-brainer."
Council members also said they wanted to make sure that Zislin's restaurant, which the developer said he would lease out to a separate operator, maintained a family vibe.
"We wouldn't want to get back into a situation similar to some of the types of businesses that were down there before that actually would prohibit or not be a welcome to families and young kids down there walking around," Mayor G.W. "Billy" Duke III said. "We need something down there, don't misunderstand me. We just need to know where we're going."
Said Councilman Philip Harris: "This has got the potential to be a first-class asset to us down there, but it also, from a management function, could end up as spring-breakers gone wild at Gulf Shores and we'll be on MTV if we're not careful about it."
Though Zislin said the restaurant would sell alcohol and may feature live music at night, he wasn't looking to recreate the rowdy night clubs of Panama City Beach at Gulf Place. He noted his plans to include a sandy children's play area near the pool.

Orange Beach Resort Gains Approval

Published by the Mobile Press Register
Wednesday, August 22, 2007
By RYAN DEZEMBERStaff Reporter

ORANGE BEACH -- With an altered spelling, new developers and a fresh look, the Gulf-front Mandolay Beach resort won unanimous approval from the City Council on Tuesday evening.
The project, which is planned for about 14 acres just west of where Alabama 161 meets the beach, will include a 40,000-square-foot convention center, restaurants, 412 hotel rooms and 208 condotel units -- essentially individually owned hotel suites -- in two towers, 28 and 23 stories tall.
As part of their proposal, North Carolina-based developers, working under the name Oceanway Properties LLC., will give Orange Beach a 175-foot-wide stretch of beach and build a parking lot and restrooms there. One of the developers, Chuck Starnes, said that the gifted property is worth about $22 million, and the bathrooms and parking will cost about $1.5 million to build.
In the fall of 2004, amid a white-hot real estate market, the $100 million project, then known as Mandalay Beach, was approved as a pair of 36-story towers encasing 500 luxury condominiums. From the onset, designs called for the creation of Orange Beach's first municipal beach -- a bartering piece intended to ensure approval of what would have been the city's tallest buildings.
Its developers, a group that included Gulf Shores real estate broker Rick Phillips, Coastal Builders owner John Case and Mobile businessman Robert Williams, sold more than 100 condos at prices starting at $900,000, they told the Press-Register in 2005.
Soon after, the market for Gulf-front condos fizzled. Lenders tightened the reigns, insurance costs soared, storm-wary buyers backed off and the project never got underway.
Earlier this summer one of the project's lenders, Compass Bank, sued the developers for more than $9 million it said they owed the bank. Simultaneously, the trio faced numerous lawsuits from contractors and buyers on two of their recently completed Gulf Shores condo towers, San Carlos and The Lighthouse.
"When the bubble burst, the project ... was no longer viable," Mayor Pete Blalock said Tuesday. "And basically it would have meant nothing would be coming to us."
The North Carolina developers, however, were able to recast the project and said Tuesday that they strongly believe construction of the hotel tower and an access road will be underway this time next year.
Oceanway Properties' purchase of the land was contingent on the council's approval, and financing is already lined up, said George Sheild, manager of the company. Sheild said Gov. Bob Riley's office agreed to allow the developers to use $100 million in Gulf Opportunity Zone bonds to complete the project.
The Gulf Opportunity Zone Act, offering low-interest rates and tax breaks, was enacted by Congress in the wake of 2005's hurricanes Katrina, Rita and Wilma to drum up private investment and rebuilding efforts on the storm-damaged coast.
"We're not just spending your time on something that is speculative," Sheild told council members. "We feel that we're in real good shape, that we will get the deal done."

Gulf Shores - Resort Rentals Robust

Published by the Mobile Press Register
Resort rentals robust
Sunday, August 05, 2007
By KATHY JUMPERReal Estate Editor

Today, Marie Curren is likely operating the elevators at the 72-unit Phoenix IV condominium in Gulf Shores.
Her real job is marketing manager for Brett-Robinson, but this is one of the busiest check-in days for the real estate company's 1,943 rental units. There are 1,000 families arriving at the firm's 16 condo complexes to spend the last week at the beach before schools start.
"What's interesting is that we have 890 back-to-backs," she said. That means a total of 890 units will have guests checking out at 11 a.m., and guests arriving to stay in those units at 3 p.m.
To keep the cleaning crews on schedule and sane, and make sure guests are happy, all of Brett-Robinson's managers are pitching in to make the day go smoothly.
"We have a 97 percent occupancy, and that's about as good as you can get," Curren said.
Though condo sales have been slow, the resort rental market has seen occupancy rates in the high 90s this summer, according to rental managers.
Taxable lodging rentals reached $57.1 million for spring 2007, a $1.3 million increase over 2004's $55.8 million during the same months, according to the Alabama Gulf Coast Convention and Visitors Bureau's June report. The taxable lodging rentals in June were 30 percent higher than in the same month last year, and up 24 percent over June 2004, which was a record-setting year, said Herb Malone, president of the Gulf Coast CVB.
"That gives you an idea of what kind of summer we're having," he said. "We expect the July numbers to be even better. People are coming down in droves."
"If you can't sell it, rent it" has been a mantra for owners and Realtors since Hurricane Katrina hit two years ago. The for-sale condo inventory has averaged 3,000 units for more than a year. While renting won't pay the mortgage, it will offset some costs, agents say.
"People ask us about rental histories all the time, and we tell them the past is a good indicator of the future," said Buzz Farias of the Pro Team at REMAX of Gulf Shores. "But nobody has a guarantee."
How much rental income a condo unit will generate depends on several factors. The first two are location -- or is the unit directly on the beach -- and how much it costs to rent for a week.
"Renters want as many bells and whistles they can get for as cheap as they can get it," Farias said.
The rental income projections are based on how much the unit costs, as well as the fees such as telephone, association dues, property taxes, content
insurance and management fees, he said.
Meyer Real Estate's sales team is "very conservative" with its rental income projections, according to Sarah Kuzma of Meyer in Gulf Shores, which manages more than 2,000 condos and some 300 beach houses on the Alabama coast and Perdido Key, Fla.
The rental estimates are based on 10 weeks of revenue in the summer, three weeks in the spring, two weeks in the fall and a month or more in the winter or snowbird season, according to Kuzma. The rental rates depend on the season, with peak summer time commanding the highest rates, agents say.
For example, a two-bedroom, two-bath Gulf-front unit at Island Royale in Gulf Shores rents for $1,590 a week during the summer, according to Meyer. The unit would bring in $25,160 a year in rental revenues as a conservative estimate, according to Kuzma.
Across the street from the beach, at the newly opened Crystal Tower, a two-bedroom, two-bath unit rents for $1,380 a week in the summer. The yearly rental revenues would be about $19,406, according to Kuzma. The new condo tower has an air conditioned walkway to the beach and a pool and gazebo on the sand.
Brett-Robinson's rental staff, like many of the large firms at the beach, work on a commission basis, according to Curren. "Our pledge is that we will generate you as much income as we can."
Rental activity will drop off in August and pick back up for the Labor Day weekend, which ends this year on Sept. 3, according to Curren. Still, the Thunder on the Gulf boat race Aug. 18 and 19 has most of the rooms along the race course booked, she said. The National Shrimp Festival in Gulf Shores in October will bring crowds to the Gulf, followed by the arrival of the snowbirds in January and February.
The snowbird season could drop from three-month stays to one month in the near future, Kuzma said. "The generation that will replace current travelers will not stay put for three months at a time," she said. "We think it will be one month, if there are a lot of activities."
There are 1,636 hotel rooms and 13,169 condo units available for lease in Gulf Shores, Fort Morgan and Orange Beach, according to the CVB. Another 147 hotel rooms and 398 condo units are expected to come on line by the end of the year, Malone said.

Gulf Shores - Record Spending Reported at the Beach

This article was published by the Mobile Press Register. It looks to me like this could be an indication that the real estate market is ready to make a positive change.

Record spending reported at beach
Saturday, July 21, 2007
By DAVID FERRARAStaff Reporter

Visitor spending along the Baldwin coast reached all-time highs this year, surpassing records set in the spring before Hurricane Ivan devastated beachfront communities.
While the occupancy level slipped below 2004, the year of the storm, retail sales in 2007 topped the pre-storm spring figure by more than $40 million in Orange Beach and Gulf Shores, according to the Alabama Gulf Coast Convention & Visitors Bureau.
"Not only are we back, we're back in a bigger way than we were even before Ivan," said the bureau's president, Herb Malone. "We're back on our growth curve, and the future is as bright as I've ever seen it. We have regained our strong position as one of the premiere beach destinations on the entire Gulf of Mexico."
Taxable retail sales in the two beachfront towns hit $176.7 million this spring, according to the bureau. That's an increase of only about $3.6 million from 2006, but Malone said figures from that year were swayed heavily by the sales of building materials.
This spring's sales revenue is about a 33 percent jump from the $132.8 million pulled in during the same time frame along the beach before the hurricane of 2004. In 2005, spring sales were at $143.7 million, according to the convention bureau.
This year's robust March-through-April sales also stretched as far north as Foley, according to figures released this week, as earnings jumped about 13 percent there this spring.
Tourists "sleep in Orange Beach, play golf in Gulf Shores and shop in Foley," Malone said, pointing out that beachgoers are often drawn to Foley's Tanger Outlet Mall. "We have a true regional economy from Foley south."
Malone expects sales to continue climbing through the summer, typically south Baldwin's hottest months -- according to the thermometer and the cash register.
"If we just keep good weather up the growth should continue," he said. "And I'm literally knocking on wood."
Before Ivan struck, the summer of 2004 was busier than it had ever been on Baldwin's coast.

Throughout 2005 and 2006, much of the sales revenue for Baldwin's coast came from building materials used to restore the area after Hurricane Ivan. After a summer without a major storm, more and more developments popped up, and money began to pour in.
Hotel occupancy rates fell to 68.4 percent this spring, about a 5 percent drop from 2004's 73.7 percent. But Malone said that's because more rooms are now available.
Malone attributed much of the sales revenue increase to new big-box retailers, like a new Target store along Alabama 59 in Gulf Shores, and The Wharf -- the new mixed-use development along the Intracoastal Waterway in Orange Beach.
The Wharf, which sits on 220 acres, is expected to one day include more than 1 million square feet of retail space and about 1,000 hotel rooms and condo units. Several boutique-style retailers and restaurants opened last year and were joined by another batch this summer.
The property also sports a marina, 15-screen movie theater, 112-foot-tall Ferris wheel and a 10,200-seat amphitheater that has hosted sell-out performances featuring the likes of Hank Williams Jr., Poison and Widespread Panic.
"The entertainment value that they brought has been a great addition to our mix," Malone said of The Wharf.
The spring funds will help pay for upkeep of roads and other infrastructure in Orange Beach, said Mayor Pete Blalock.
"We're back growing in the right direction," Blalock said.
Gulf Shores Mayor G.W. "Billy" Duke III said the increase in sales will help officials budget for projects like a new sports complex, another fire station and more personnel at City Hall.
"It enables us to get out of a storm-recovery mode into things that help our residents," Duke said.
Looking toward the summer ahead, Duke said, "I think it's going to be a record-breaker."