The St. Joe Company Provides Update On Its Northwest Florida Development Strategy and Business ProspectsStrategy To Trigger "Chain Reaction of Value Creation" Designed to Produce Value Beyond Anything Originally Envisioned
BUSINESS WIRE - May 17, 2001 09:58
NEW YORK, May 17, 2001 (BUSINESS WIRE) --
Convergence of Baby Boomer Demographics, Coastal Land Scarcity and Extensive Coastal Land Holdings in Northwest Florida Make JOE Exciting Investment Opportunity
The St. Joe Company (NYSE:JOE) today outlined a strategy designed to produce for shareholders a "chain reaction of value creation" in Northwest Florida at the company's annual financial analyst conference in New York City.
"With St. Joe's concentrated land holdings in Florida's Great Northwest - and the company's focused efforts to trigger a regional transformation - we believe that every action we take to create value will, in turn, create more value," said Peter S. Rummell, chairman and CEO of St. Joe. "That ripple effect can cause an expansion in value for JOE shareholders beyond anything originally envisioned.
"One year ago, we said that Baby Boomer demographics, Florida land scarcity and St. Joe's extensive coastal land holdings in Northwest Florida are converging to make St. Joe one of the most exciting investments in any industry," continued Rummell. "Today, with another year of progress, we are more excited than ever about the opportunity.
"Scarcity is driving up the value of developable beachfront and near-coast waterfront," said Rummell. "At the same time, demand for vacation properties and second homes is on the rise. This increase in demand is being largely driven by Baby Boomers. Over the next ten years, more Baby Boomers will move to Florida than any other state, creating unprecedented demand.
"St. Joe owns a significant portion of the developable beachfront and near-coast waterfront remaining in Florida," said Rummell. "St. Joe owns approximately 428,000 acres of land within 10 miles of the coast including 39 miles of Gulf of Mexico coastline and 6 miles of white-sand beaches. In addition St. Joe holds approximately 261 miles of waterway frontage near the coast and an additional 249 miles of additional water frontage accessible by recreational boats. Purchased by St. Joe in the 1920's and 1930's, this land is carried at a very low basis.
"Today, we are working to maximize the value of these lands by managing how we bring our supply to market, sequencing our projects to drive value ahead of development, and continually pushing to find the highest and best use for every acre of land we own," said Rummell. "In addition, we are promoting regional infrastructure and economic development for the region.
"The process, called 'regional place-making,' provides an unprecedented opportunity to coordinate and sequence development projects so that each one builds value on value, maximizes earnings and enhances quality of life in the region," Rummell continued.
"In the last year, significant progress has been made towards transforming Northwest Florida. Major regional infrastructure improvements are underway," said Rummell. "The FAA has approved the relocation and expansion of the Panama City - Bay County International Airport. Roads, health care and education across the region are being improved. And for the first time, the region has an aggressive, coordinated economic development program, called Florida's Great Northwest, Inc.
"At the same time, St. Joe has been moving forward quickly with development projects that will help transform the region," said Rummell. "As projects like WaterColor, PierPark, Camp Creek Golf Club and WaterSound are developed, we expect them to dramatically increase the value of the former timberlands that surround them," said Rummell. "In turn, demand is created for retail, commercial and other residential uses sparking an ever-increasing value creation cycle."
St. Joe President, COO and CFO Kevin M. Twomey told analysts that every part of St. Joe is focusing on execution and working in northwest Florida to deliver value to shareholders.
"We have pursued a very sophisticated asset allocation and land use planning process in an effort to push value ahead of development," said Twomey. "St. Joe has multiple value creation 'engines' at work, including resort/residential, retail, commercial and primary residential.
"Each of the value creation engines is designed to be a stand-alone business, but in fact, each adds momentum and builds value for itself and the others. When integrated, their value creation power is greatly enhanced," said Twomey. "Greater numbers of rooftops create greater demand for real estate and retail services - which in turn generates more jobs and greater demand for rooftops - thus establishing a continuing value creation-cycle."
Twomey outlined a new product concept for St. Joe Land Company called "RiverCamps." The RiverCamps will provide an opportunity to increase value for former timberland. He said the RiverCamp product will offer rustic elegance and the sporting life near beautiful rivers and bays. Potentially 40,000 acres of former timberland could become RiverCamps at 12 or more locations across Florida's Great Northwest.
"Most real estate development companies have little opportunity to generate synergy. JOE is different," concluded Rummell. "For an entire region of Florida, JOE has the rare opportunity to be the catalyst for - and beneficiary of - a chain reaction of economic growth and value creation." |
