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Too many beach condos for sale? Not enough, developer says

By MIKE DONILA
Published March 29, 2007

Condominium sales on Clearwater Beach have slowed to a crawl, and there are currently more than 800 units on the market in the area.

But that isn't stopping one local developer. It's ready to build some more.

JMC Communities this morning will break ground on its fourth Clearwater Beach mega-development: Marquesas, a $200-million project that features two towers with 142 residences and six penthouses.

This new community, which includes a garden pavilion, outdoor spa and waterfront esplanade, will encompass almost 6 acres on south Clearwater Beach, just north of the bridge to Sand Key.

JMC Communities has been one of the few successful developers along the beach in recent years, building Mandalay Beach Club, Belle Harbor and Sandpearl Resort and Residences, which is set to open this summer.

Other developers haven't been as fortunate. Of the nine high-end projects that cover a 1-mile stretch on S Gulfview Boulevard, only two are under way. Besides Marquesas, there's the Aqualea, an NJR Development project, which brought in construction crews last December.

The other projects have been delayed or have changed in scope. Developers blame a soft market caused by skyrocketing taxes and insurance rates.

Those problems also have affected resales along the beach. The days of investors flipping condos within just a few days are long gone.

There are 820 condominiums for sale in Clearwater Beach, Sand Key and Island Estates, according to records collected by the Pinellas Realtor Organization, which tracks available units sold through Realtors.

Still, that might not necessarily translate into gloom and doom for newer models.

"There's always going to be a demand for a new product and (JMC) in Pinellas County is a premier developer as far as I'm concerned," said Jim Warner, a broker with VIP Realty on Sand Key. "I think these will sell."

Lenders also have set higher standards for developers to tap into promised loans. Many banks now want builders to meet presale rates of at least 90 percent.

Steven McAuliffe, vice president of sales and marketing for JMC, said the company needs to reach about 40 percent presales for the first tower, which includes 74 units. He said the sales staff is "probably two-thirds of the way there," and that they've already sold three of the more expensive penthouses.

"I think that shows that it's not all price-driven - there's a market for all price ranges," he said.

Marquesas will replace the 210-unit Holiday Inn Sunspree, which developers demolished late last year. The new condos will cost between $835,000 and $1.7-million, and the penthouses will go for $2.12-million to $3.27-million.

These prices will jump by as much as $100,000 as sales increase, developers say.

"I think the market is definitely coming back; we've noticed quite an upswing in the last few weeks and we're very optimistic and positive about the community and sales activity," McAuliffe said.

The St. Petersburg-based developer plans to build Marquesas in two phases. The first tower should be complete by spring 2009, and ground will be broken on the second tower in about a year.

Today's groundbreaking kicks off at 9 a.m. and is open to the public. About 100 people, including city leaders and future residents, are expected to attend. And the event will feature music and an island-style buffet breakfast.

There will also be a lift so visitors can see the views from different heights.

Fast Facts:

What's coming

Developers this morning will break ground on Marquesas, a $200-million project that features two towers with 142 residences and six penthouses. The complex is just north of the bridge to Sand Key on Clearwater Beach. For more information, go to www.marquesasjmc.com.

[Last modified March 28, 2007, 23:30:10]