Scott & Tinsley Myrick, Gulf Coast Real Estate Professionals

Developers ditch condos, ride commercial Waves

Gulf Shores businessmen whose project is one of nine with extensions expiring in October opt to build shopping center instead

Sunday, September 28, 2008

By KATHY JUMPER

Real Estate Editor

Three Gulf Shores businessmen dropped plans to develop 67 condominium units and are rebuilding their retail store bigger and better on 11th Street and W. Beach Boulevard in Gulf Shores.

Waves shopping center is under construction on 1.6 acres and will open by the end of the year, according to owners Marty Hoffman, his brother Johnny Hoffman, and builder Greg Kennedy.

The Hoffmans bought the property in 1996 and operated Waves Groceries & Beach Apparel, as well as a package store, there for a number of years until Hurricane Ivan destroyed the building in 2004.

After Ivan, the Hoffmans partnered with Kennedy on plans to build condo units, but put the effort on hold when the condo market stalled.

"We had hoped the real estate market would turn," Marty Hoffman said.

The group is one of nine developers whose approved condo proj ects got building extensions from the city of Gulf Shores good until Oct. 10. The extensions were granted in late 2005, allowing developers to build under old codes if they chose not to redesign projects to meet new zoning rules that limit density and building height on the beach.

Kennedy said his group doesn't expect the city to renew the extension next month.

The new zoning came about as part of the Envision Gulf Shores planning process following Ivan. Its aim is limiting the development options on Gulf-front parcels to prevent traffic congestion and a glut of condo towers, and to create a pedestrian-friendly downtown area.

Gulf Shores Councilman Robert Craft said he will not support another extension for that area, but noted that he is only one of six votes. The extensions expire before he takes office as the newly elected mayor on Nov. 3.

The extension just delays the Envision plan that was enacted four years ago by the citizens, Craft said. "That is a unique area of town, and in my opinion, that whole West Beach area should never have been zoned beyond a certain point for higher density residential."

The property is low and prone to flooding even in minor storms and there is only one way in and one way out, he added.

Building Waves made more sense, according to Kennedy. To construct condo units under the city's new density guidelines would have cut the planned number of units by almost two-thirds, he said. The partners had sold the project to a developer, but after Hurricane Katrina in 2005, an increase in insurance costs and a subsequent glut in condo inventory, the plans fell apart.

Instead, the group is investing $1.3 million in Waves shopping center, which is across the street from the beach.

The two-building center will include Waves, a 4,800-square-foot store that carries groceries, bait, tackle, beach apparel and features a 500-square-foot package store; Shakes Frozen Custard, which also has locations in Foley and Orange Beach; and a 3,100-square-foot restaurant with outdoor seating.

The restaurant has not been named but it will be operated by the owner of Sunset Cork Room on E. 2nd Street in Gulf Shores, according to Kennedy. There is plenty of interest in the remaining retail space, he said.

Waves is the last zoned commercial site on W. Beach Boulevard, which the developers view as a plus, according to Johnny Hoffman.

Kennedy added, "Every restaurant that's been there has done well."

/cut/3/cMIKE KITTRELL/ Staff PhotographerJohnny Hoffman, Greg Kennedy and Marty Hoffman are the developers of Waves, a commercial center under construction at 11th Street and West Beach Boulevard in Gulf Shores. The center's two buildings will include include a retail store, a Shakes Frozen Custard and a restaurant. The trio originally had planned to build condominiums.

Gulf State Park officials seek to dredge lakes, sink reefs

Monday, September 08, 2008 By RYAN DEZEMBER Staff Reporter

GULF SHORES - The U.S. Army Corps of Engineers is seeking public input on proposals from state officials to dredge parts of Shelby and Middle lakes as well as to turn Gulf State Park's old fishing pier into artificial reefs.

The dredge project, according to a Corps of Engineers public notice, is aimed not only at clearing out sand that blew into the lakes during hurricanes Ivan and Katrina, but also at rebuilding Gulf-front dunes.

To achieve these twin goals, the Alabama Department of Conservation and Natural Resources has applied to dredge 44,528 cubic yards of sand - nearly 2,800 dump trucks worth - from a 13.8-acre area in the southern part of Lake Shelby. The sand would then be pumped through an existing culvert beneath Alabama 182 to a 10.2-acre site just west of the park's fishing pier.

From the southeastern-most 16.3 acres of Middle Lake, the Conservation Department has asked to dredge and pump 52,594 cubic yards of sand. Those 3,300 truckloads would be pumped beneath the beach highway to a 9.1-acre area west of the park's beach pavilion, according to the proposal.

Once on the beach side of the highway, the sand will be shaped to replicate the contour of the dunes as they existed before the storms. Salt-tolerant plants and sand fencing will also be installed to help the restored dunes hold their shape, the corps said.

Besides wanting to improve habitat in the dunes around the Gulf State Park's fishing pier, Conservation Department officials have said they seek to better the living conditions for wildlife on the water bottom near the pier.

In a separate proposal, state officials have asked permission to tear down what remains of the park's old fishing pier, which was built in 1968 and destroyed by Hurricane Ivan in 2004, and turn the material into 10 artificial reefs.

The reefs would measure 25 feet by 50 feet, according to the corps, and be sunk around the new fishing pier. Those that wind up in less than 20 feet of water will be

6 feet tall or less, and those in more than 20 feet of water will protrude from the bottom as much as 9 feet, according to a public notice.

The state also wants to install 20 round reefs that are

5 feet tall and 20 pyramid-shaped concrete reefs that are about 8 feet tall around the new pier.

Park Superintendent Hugh Branyan said state officials are hoping the reefs will lure, in addition to more fish, different species than are normally found near shore.

"We're thinking that even some snapper and grouper will come in," he said. "They're usually farther out but this will be a pretty good bunch of reefs."

Currently under construction, the new 1,512-foot-long pier, which sits about just east of the old structure, is expected to open by February. Nearly twice as long as the old pier and 50 percent wider, the new structure carries a $14 million price tag.

The following is a list of "Bank Owned" condos showing active in our local MLS. The following condos are either direct Gulf front or across the street from the beach. If you are interested in owning a beach front condo in Gulf Shores or Orange Beach, Alabama, send me an email at scottmyrick@yahoo.com and I will send you a weekly list including photos and recent comparable closed sales... You can also visit our website.

Local condo boards hold their own in foreclosure crisis

Sunday, August 31, 2008

By KATHY JUMPER

Real Estate Editor

Foreclosures haven't hit local condominium associations as much as their peers in some states, but that may change as new assessments are sent out to help pay for insurance.

Condo foreclosures hit a plateau about six months ago, according to attorney Daniel Craven of Gulf Shores. "We're not in as desperate financial condition," as other parts of the country, he said. "And collection efforts on delinquencies have held their own."

Craven represents more than 100 condominium and property associations in the area.

About 24 million housing units are governed by 300,800 homeowner associations in the United States, according to the Community Associations Institute, a nonprofit group based in Alexandria, Va. While the group had no exact numbers of foreclosed units, officials there said the impact is significant.

Shortfalls may be more common among newer associations that haven't had much time to build up reserves, according to condo managers. But older associations are also hurt if no reserves have been maintained.

There are 13,169 condo units available for lease in Gulf Shores, Fort Morgan and Orange Beach, according to the Alabama Gulf Coast Convention and Visitors Bureau. All have a condo association and many of those associations are managed by local rental agencies.

The condo dues at the Gulf range from $200 per month to more than $1,500, depending on the size and age of the unit, managers said.

"We've had very few foreclosures, and the ones we had were in trouble before the market" slowed down, said Linda Moore of Kaiser Realty in Gulf Shores, which manages numerous condo associations. Most owners who did have problems had several units in different complexes, she said.

Many associations assessed owners after Hurricane Ivan in 2004 to make repairs that weren't covered by insurance, or in some cases where associations were under-insured, condo managers said.

Craven said condo insurance rates are down to 60 cents per $1 value, which was close to what rates were before Ivan.

"Insurance rates have dropped dramatically in the condo sector,"he said.

Condo boards are now asking for an assessment for insurance costs rather than including it in the annual budget, said Lolly Holk of Meyer Real Estate in Gulf Shores, which manages 17 associations.

And associations are moving more quickly on delinquencies than in the past, condo managers said.

"Associations do not let the owners get too far behind on their dues before popping liens on them," Holk said. "The owners have so many days to get the money in and if the association sees it going real far, they will keep updating those liens."

A condo association's budget is based on the assumption that all the unit owners are going to pay, according to Craven. "Ultimately, if it doesn't happen, it can hit the pocketbooks of other unit owners. Most associations are very aggressive in turning a collection problem over," for legal action.

In addition to liens, associations can handle delinquencies with lawsuits and garnishments on wages or bank accounts.

Alabama's condo law offers protection to condo associations on the payment of dues, but not on special assessments, according to Craven. If a unit goes into foreclosure, the lender or other foreclosure entity must pay up to six months of back dues that are owed to the association, he said.

At Meyer, owners that are two months behind on association dues area heading toward a lien, Holk said. The collection time has been reduced to 60 days from 90 days by many association managers, she said.

"One of the issues we've addressed with the boards is that we understand that the guy next door is your best friend and golf partner, but we're looking out for the best interest of the association," Holk said.

Some of the associations are trying to keep the monthly fees down to make the units attractive to potential buyers. But Holk says the informed buyer should be looking at the financials and what's in reserve. "That tells a greater story than the monthly maintenance fee," she said.