March 9, 2006

The Real Estate Adviser: Health food store fortune creates a healthy development

NAPLES, Fla. — Perhaps some have visited Disneyworld, attended a conference in Orlando or changed planes in Miami, but the vast majority of Puget Sound residents simply spend their leisure time closer to home. Especially in the winter. Northwest snowbirds typically head to Arizona, California and Mexico, or save their hard-earned dollars for a dream vacation to Hawaii.

You hear about Florida from friends, often those raised in the Midwest, whose parents retired to the Sunshine State years ago. It's still the most mentioned retirement state in the country. Yet lately, it seems to be home to tales of condominium "flipping" by gambling investors who turn over properties without any thought of occupying them and of thoughtless developers who have pulled every trick possible to plant the maximum number of units on a given piece of ground, regardless of the topography.

But there are also stories about developers and builders who conduct business the right way and actually establish a philosophy of land stewardship as part of a company culture, not merely as a one-time solution for obtaining the permits to exploit a problem parcel.

Large developers like the Bonita Bay Group have taken heat simply for being big and catering to upscale baby boomers. It employs more than 1,500 individuals and is currently developing eight master-planned communities in Southwest Florida, but it also has been recognized for responsible and innovative development in enhancing the environmental integrity of its sites by the Urban Land Institute, Golf Digest and the Council for Sustainable Florida.

The original vision can be traced to the company's founder, David Shakarian, who turned six "health food" stores in Pittsburgh specializing in yogurt, honey and grains into the multi-million dollar chain of more than 4,800 General Nutrition Centers featuring its own vitamin and mineral supplements as well as foods, beverages and cosmetics in the United States and more than 35 foreign markets.

In 1979, Shakarian took the idea of a healthy living environment to Southwest Florida where he had vacationed with his family. His goal was to create a community where wetlands were preserved, natural flow ways restored and water-conservation efforts practiced to ensure the protection of precious resources.

He started the Bonita Bay Group which quickly established a reputation as the area's most ecologically sensitive developer.

The first community was Bonita Bay, a 2,400-acre master-planned community just north of Naples in Bonita Springs. Located on Southwest Florida's ecologically sensitive gulf coast, the property became the company's flagship site and incorporates a range of delicate ecosystems, from fresh- and saltwater marshes to mangrove stands, a river and creek and Estero Bay that leads to the Gulf of Mexico.

"When he first bought that property, people thought he was absolutely crazy,'' said David Lucas, a Harvard MBA graduate and Shakarian's son-in-law, who took over the family business when Shakarian died in 1984. "People said the property was too remote, too wet to develop and nobody would ever want to live there. It might have been in the middle of nowhere at the time with a lot of challenges, but he simply found a way to make it work.''

At build-out, in 2010, fewer than 3,300 residences will have been constructed, a significantly lower density than the 9,240 units approved in the master plan. More than 1,400 acres remain open space, including 230-acres of lakes, expansive nature preserve areas and 12 miles of bicycle and walking paths. The off-site golf course, called Bonita Bay Club East, includes 895 acres of cypress wetlands, 190 acres of pine flats, lakes, hundreds of native sabal palms and open space. No residential development will ever occur on the golf course site.

Nancy Payton, a representative from the Florida Wildlife Federation, said her agency worked out an out-of-court settlement with the Bonita Bay Group when the company took over a trouble development in 2001.

"There were several lawsuits, and counter lawsuits, with the previous developer over wildlife and wetlands issues,'' Payton said. "The property had some sensitive issues yet the developer was reluctant to reduce the number and placement of housing units on the property.''

The lovely parcel was tied up in court for months, with both sides spending tens of thousands of dollars on legal fees. Payton said she feared all of the players involved could run out of money before any significant progress was ever made in the case.

"The Bonita Bay people basically came and asked what would be possible if they obtained title to the land. I was surprised because no developer had done that before. They eventually purchased the property from the original owner and worked with us to reach a fair solution.''

It seems like a logical, consistent way of "taking care" — from health food to preserving beautiful property.

Previous columns:

• The Real Estate Adviser: Snowbirds discover Florida's west side, 03-02-2006
• The Real Estate Adviser: Tenants can be a pain, but landlords can be, too, 02-23-2006
• The Real Estate Adviser: Houses grow as household size shrinks, 02-16-2006
• Investors are key to housing: Will they flip and run?, 02-09-2006
• The Real Estate Adviser: 'Katrina cottages' may find buyers beyond Gulf states, 01-26-2006
• Home builders' obsesssion: boomers, 01-19-2006
• The Real Estate Adviser: Higher loan ceilings will help homebuyers, 01-12-2006
• The Real Estate Adviser: Homes: what's out, what's in for '06, 01-05-2006