Blessings from an ugly piece of landBy KRIS HUNDLEY, Times Staff Writer
© St. Petersburg Times
published July 13, 2003
MIAMI LAKES - Graham Cos. got its start in 1921 when Ernest R. Graham, once a gold miner in South Dakota, was recruited to run a sugar cane operation being carved out of Everglades muck.
"Cap" Graham became the boss of Pennsuco, the Pennsylvania Sugar Corp.'s plantation northwest of Miami.
By the time Bob Graham was born in November 1936, the brutal wildness of South Florida had taken a personal and professional toll on his father. Frost, floods and hurricanes forced Cap Graham's employer to abandon its Florida experiment at the end of 1931. Shortly afterward, his first wife died of cancer.
The elder Graham picked up 7,000 acres in northwest Dade County as severance pay from the sugar company and started over in the dairy business. This time he struck white gold, with the rapidly growing Miami metropolis driving up demand for milk.
Over time, the Graham dairy business broadened to include beef cattle. At 14, Bob Graham showed Holstein heifers at a state 4-H meet in Orlando. At 16, he was in charge of 20 head of registered Angus.
By the time Graham went to the University of Florida in 1955, the Dade County real estate boom had pushed development to the edge of the family's acreage. Developers, including John D. MacArthur, the wealthy Chicago businessman, were making tempting financial offers for the entire Graham spread.
Rather than sell out, Cap and his family decided to transform 2,500 acres of scraggly pasture land at the bend of the Palmetto Expressway into a planned community called Miami Lakes. The idea was to build and sell single-family homes to generate revenue, but to build and keep everything else - from offices to warehouses to apartments to shops.
The Grahams didn't abandon the dairy business as they moved into development. The family continued to milk cows in Miami Lakes through the 1970s, as homes, offices and apartments were being erected like pieces on a Monopoly board. The Miami Lakes cows weren't just for atmosphere. Over the years, as land values zoomed, the Grahams kept their tax bill low by continuing to use parts of the land for grazing.
Today, two dozen black-and-white heifers still graze on a vacant parcel next to a restaurant construction site across from Miami Lakes' Main Street.
The cows in Miami Lakes are eventually shipped to the family's 1,500 acres in Highlands County, which serves as a sort of cow maternity ward. Serious milk production takes place at the 2,200-acre dairy in Moore Haven, on the shores of Lake Okeechobee, where 2,000 cows produce more than 13,000 gallons of milk a day.
The company also grows about 800 acres of sugar cane in Moore Haven, with the crop hauled away on U.S. Sugar's railroad abutting the Graham property.
"Everybody around us grows cane, and sugar is a passive business which doesn't entail a lot of work," said William E. "Bill" Graham, the senator's nephew who now runs the family business.
Graham Cos. also owns 10,000 acres in Albany, Ga., where the family raises certified Angus cattle, produces about 1-million pounds of pecans annually and grows pine trees for lumber and paper.
"We're into so many different businesses, that if one is bad, usually the others will do well," said Bill Graham, who is company president.
These days, dairy farming is running in the red, as is the overnight business at the Graham-owned Don Shula's Hotel in Miami Lakes.
Offsetting those soft returns are strong results from Miami Lakes' 1,500 apartments, where rents range from $600 to $1,500 a month. Warehouse, office and retail rents are steady, though Bill Graham says keeping Miami Lakes' downtown stores full of tenants is no picnic.
"Everybody loves the idea of a Main Street," he said of the tree-shaded downtown that's ideal for window-shopping. "But they still do their shopping at Wal-Mart."Around for the long haul
The Graham family's influence over Miami Lakes, which has about 23,000 residents and median household income of $61,000, is subtle but strong. Incorporated into the original plan were thousands of trees, a dozen lakes, sidewalks, winding streets and toddler play parks. Sign and height restrictions (nothing over four stories) keep commercial clutter to a minimum. Deed restrictions mandate roofing materials (all barrel tile) and home colors.
Bob Graham, just graduated from Harvard Law School in 1962, was closely involved in predevelopment of Miami Lakes. Among his contributions: naming the streets in one neighborhood after Dade County pioneers.
Though Miami Lakes largely predates aggressive environmental efforts in South Florida, longtime activists say the Graham family did it right.
"Before there were rules and regulations about things, they did it voluntarily," said Joe Podgor, who headed both Save Our Water and Friends of the Everglades. "The Graham family all lives there, so they intended to go for the long haul."
Graham Cos. is no longer in the home-building business. But when the economy picks up, the Grahams still have about 100 acres within Miami Lakes they hope to develop for commercial use. There's another 380-acre parcel - part of Cap Graham's original Pennsuco acreage - awaiting development.
"We get several offers a week to buy that property," Bill Graham said of the melaleuca-rimmed acreage off Interstate 75 that he called the last big open parcel in northwest Dade County. "The numbers we hear are wild."
But big numbers don't sway the Grahams, who know the long-term value of dirt. The family often quotes the eldest Graham son, Philip, who welcomed guests to Miami Lakes' groundbreaking with this candid assessment:
"We've been blessed with one of the ugliest pieces of ground anywhere," said Philip, who was publisher of the Washington Post. "You don't have to worry about the developer screwing it up. We can only make it more attractive."Paying market rent
Though the senator is a silent partner in Miami Lakes, his image pops up around the town like a patron saint. Pictures of Graham arm in arm with former Miami Dolphins coach Shula have prominent placement in the hotel, golf club and health club.
While his image may be used to sell hotel rooms and steaks, Graham's influence in Washington doesn't appear to have helped the family business in a conflict with the Internal Revenue Service. In 1994, the Graham Cos. was unable to get a favorable ruling from the IRS on its proposal to do a tax-free spinoff in preparation to go public.
"The government was unwilling to rule on our request, and we were unwilling to take the chance we'd be hit with a $50-million tax bill," said Graham's nephew. The company dropped plans to go public as a result.
With Uncle Bob running for president, Bill Graham said the company is trying to avoid becoming too entangled with the campaign. The national headquarters of the Graham for President campaign has rented space in the Graham Cos. office building for about $5,700 a month. "They're paying market rent," Bill Graham said.
Peter Harrison, an office leasing expert with Cushman and Wakefield in Miami-Dade County, agreed that the campaign's annual rent of nearly $20 per square foot is about average for the area.
While each family member has made the maximum donation to Bob Graham's campaign, their enthusiasm for his candidacy is notably tempered. Though it will bring national exposure to Miami Lakes, the presidential bid also will force the normally private Graham clan into a spotlight they have studiously avoided.
"I don't see anybody out there better than Bob," his nephew said recently. "And he'd be our hardest working president ever. But if he became president, for us it would be a real pain, to be truthful."
- Times staff writer Bill Adair and researcher Kitty Bennett contributed to this report.
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