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September 22, 2018

The Florida Keys post-Irma

Mike Vogel | 1/26/2018

Upscale, upscale

Meanwhile, older housing continues to give way to substantially more expensive housing. Late in 2017, the developer of the private Marlin Bay Yacht Club in Marathon began selling its 84 Dutch Colonial style residences, which are elevated nine feet above grade, and 99 boat slips. Marlin Bay looks like a second-home buyer’s dream. Residences run from $1.75 million to $4 million. It replaced a mobile home park. Sales executive Patrick Lenihan says interest has been high. “There’s not a lot of new product. There’s so much demand for the Keys and so little inventory,” Lenihan says.

The Keys’ success also continues to spur upscale commercial development that, because of ROGO, unintentionally further shrinks the workforce housing supply. The recently opened Perry Hotel was built on Stock Island, the longtime working and workforce-housing key just up from Key West.

Brad Weiser of Miami-based developer Hostmark Hospitality says investors initially were skeptical about the location, once the site of a fish processing plant, but after they saw it was an easy shuttle bus ride to Key West and saw its location on a marina, they bought in.

Over a decade, developer Matthew Strunk assembled the 12 acres for the hotel site, an artist village, eateries and a distillery- to-come along with a 20-acre marina. The marina has the expected fishing and touring charters but also live-aboard slips, the ability to accommodate megayachts and also hosts commercial fishing vessels; as part of its governmental approvals, the developer had to preserve a working waterfront. But to get permission to build under ROGO, the hotel’s developer bought a trailer park elsewhere in the Keys, closed it and used a portion of its alloted living units for the hotel site.

It remains to be seen whether the storm will provide momentum for the county’s initial efforts to address the housing issue. Since Irma, the county took the first step in a yearlong process of streamlining its approval system to encourage workforce housing development. Among the measures being considered: Relaxing height restrictions and increasing densities, both of which draw — at a minimum — skepticism from existing residents. The county also is looking at asking developers about siting a “tiny house” — 750 square feet — on county land as a demonstration of a possible solution.

The house is affordable, but what really drives costs upward are the government requirements for site design, certifying elevation and a host of other mandates such as spraying for subterranean termites. “Who cares about subterranean termites in Monroe County?” asks Saunders.

Don’t expect an easy fix. Says Rice: “It seems like everything has a negative effect on our affordable housing market.”

Tourists Undeterred

On a drive down the 112-mile Overseas Highway along the island chain road in November, hundreds of piles of debris on the roadside showed the most tangible remnants of Irma — vegetation, couches, appliances, a ruined RV, a boat with “SS Irma” written on it.

Sharp-tongued and fed-up residents gave Monroe County Mayor David Rice and his fellow commissioners an earful about those piles at a late November meeting originally called to discuss housing. Other vestiges of Irma? A few resorts remain closed, including Hawks Cay at Duck Key, which will be shut into the summer. A number of businesses are still shuttered, and as of November more than 3,000 Keys residents were receiving FEMA housing assistance in some form.

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