The Tavernier Dive Center and Plantation Key Fisheries were thriving until the real estate boom of the mid-2000s, when the canal-front land they sat upon became more valuable than the buildings and the businesses.
Campgrounds, trailer parks, marinas, mom-and-pop motels — any commercial property with waterfront in the Florida Keys — became targets of luxury developers armed with grandiose plans and banks willing to lend big bucks.
During the land rush, the upscale developers gobbled up hundreds of acres of precious property from Key Largo to Key West, including the dive center, the fish house and even the funky but rundown Holiday Isle with its World Famous Tiki Bar, for an eye-popping $98 million. All were scheduled for demolition.
“The rat bastards bought up our property and took our affordable housing,” backcountry fishing guide Capt. Dennis Robinson said at the time.
But then came the real estate and credit crash in 2007 and 2008. More than 20 upscale projects with names like Playa Cristal, Ocanos and Seaglass, and with a collective price tag of nearly $1 billion — came to a screeching halt. Even Home and Garden Television’s 2008 Dream Home, serving as the anchor, couldn’t save a pricey multi-unit project in Islamorada called The Shore.
While it was a reprieve from the economically diverse island chain feeling like it was turning into a playground for the rich, the collapse left a big mess in its wake: evicted trailer park tenants, bulldozed campgrounds with “keep out” signs, shuttered waterfront businesses and half-built condos in ghost town resorts. The mess also included a slew of foreclosures, lots of lawsuits, plummeting property tax revenue for the local government and federal fraud charges for five people involved in an alleged $300 million Ponzi scheme.
“We’ve all seen downturns in the real estate market, but I’ve never seen anything this deep last this long,” said Brian Schmitt, broker at Coldwell Banker Schmitt Real Estate Co.
It’s been five years, but finally most of the mess is beginning to be cleaned up. Literally. Fifty-seven large containers full of debris recently have been removed from the building that used to house the Plantation Key Fisheries. New owners are redeveloping four vacant buildings — which once were part of the alleged Ponzi scheme of Cay Clubs Resorts and Marinas — but had become a haven for vagrants and drug dealers.
“We bought this for like 8 cents on the dollar,” said Keys native Nick Lee, who’s managing the construction project for the new owners: his mother and a family friend.
Other bargain hunters have quietly started buying up the bank-owned properties, keeping mostly a low profile until they figure out what the market will bear.
Private investors who want to remain anonymous purchased the uninhabited Marlin Bay Yacht Club in Marathon at the end of 2011 for just $15 million. The swanky $220 million project by Virginia-based L.M. Sandler & Son abruptly ran out of money in 2008 with only 13 of the planned 84 upscale townhouses constructed.
Five months ago, investors who formed the Key Largo Hospitality Land Trust bought the former American Outdoors campground for $7.3 million. In 2005, Cortex Resort Living paid $28 million for the same land with mature vegetation and breathtaking views of the bay.