5 Reasons it Makes Sense that Southwest Comes to Panama City

With the new airport wet on their lips, all the local and not so local media has been eating up the “airport wars” stories that have been ensuing over the battle for Southwest Airlines. Today, it would seem, that everyone is vying for them; everyone in Northwest Florida, that is. In fact, in the last 60 days alone, all of a sudden VPS (or Northwest Florida Regional Airport in Ft. Walton) and Pensacola Gulf Coast Regional Airport have made very public efforts to woo Southwest in their direction.

Today, at a YP@TheBeach (Young Professionals AT The Beach) luncheon we had the great pleasure of listening to Representative Jimmy Patronis describe how he grew as a Young Professional into his career in politics. Jimmy, as always, it was great to see you. I asked about the progress with Southwest Airlines and whether we were any closer to seeing a commitment from them to come to our new airport. The short answer is below, but let me spell out the long answer as he did to us, as it is definitely worth telling.

This area needs it.

Southwest Airlines’ flight destination plan is laid out in a mesh-style pattern. Picture circles all over the US in which their radius is about a 5 hour drive. Right now, you’ll see an airport that services Southwest right in the middle of each make-believe circle. Of course, this is only applicable in areas with a particular and significant population size. Right now, there is a Southwest airport in New Orleans, Jackson MS, Birmingham, Jacksonville, Orlando, and Tampa, but a void in our little stretch of the country. In order for them to keep with their mesh-style plan, they need one in our part of the country.

Pensacola won’t work.

Right now, servicing Pensacola is Air Tran, a great low-cost carrier. Often times they offer great competitive rates to most large cities and many smaller cities a lot of the time, non-stop. Pensacola is also about 200 miles from New Orleans, or within about a 2.5 to 3 hour drive – really too close to be considered not a competitional threat to existing operations in southern Louisiana. In addition, as it was explained to me, Southwest counts the number of street lights you have to go through to get into the airport and weighs that in regarding ease of access. As I understand it, Pensacola is not easy for travelers to come into.

Just students and government folk in Tallahassee.

If you think about who is coming and going in Tallahassee, there’s not much need for a low cost carrier to service that destination. They have adequate flights coming and going and the traffic to that destination isn’t likely to change because of a new airport. The future travel growth there has no real upward potential.

Dothan’s great, but they have no need either.

Same story, different location. There’s a lot of great people, great industry, and great money, but who’s traveling there, how much are the people there traveling out, and what is the future potential for travel growth for Dothan, Alabama.

Despite what they say, Ft. Walton just can’t handle Southwest Airlines.

This is the big one folks, and it isn’t likely to make our neighbors to the west of here very happy, but these are the facts. The Ft. Walton Airport, aka Northwest Florida Regional Airport, aka VPS is sharing their on-ground and in-air operations with the Department of Defense. This shared arrangement limits their flight operations to 100 total flights per day; that’s 50 flights in and 50 flights out. Currently they are using 60% of their daily operational capacity. Why in the world would a company as successful as Southwest Airlines come into an environment where right off the bat they would be limited as to what their future potential growth at that airport could be.

You see, it is all about the future. This is where so many opponents to the airport have missed the mark in their arguments. They focus on operations right now at the current airport and say we’re under capacity. Well, yeah, of course we are. Have you checked to see how much it costs to fly in and out of here lately? If we had a carrier that could bring low cost airfare to our neck of the woods, don’t you think we would get that business that drives to Dothan, Tallahassee and Northwest Florida Regional? What’s that you say? No numbers of real importance actually travel 1 to 2 hours away to save on airfare. Wanna bet?

At the new airport, Southwest has unlimited potential for future growth. Furthermore, I’d be willing to bet that they could have significant influence on how infrastructure is laid out at the new facility to best suit their needs. Furthermore still, they have $2.2 million each year to back any advertising to help drive people to use their service to fly to Panama City. In addition to all that, there is very likely to be a huge demand in travel to our destination over the next couple of years as many of the areas that could not travel here before can now get here with ease. And, to cap it all off, we are right smack dab in the middle of one of the concentric circles that virtually map out where each airport servicing Southwest Airlines will be.

Southwest Airlines was referred to as the “golden goose” of airlines in this morning’s paper because despite the tumultuous times in the airline industry, they, for the most part, have remained in the black. Their business model and growth plan fits perfectly with the ideals of Panama City and we would make a perfect fit for their next step. Hundreds of thousands of people have yet to discover the marvel that is Panama City Beach and that business is not only ripe for the picking by our area, but also Southwest Airlines.

Green Leadership Committee Encourages Local Participation in 24th Annual International Coastal Clean-Up Day

Saturday, Sept. 19, 2009 marks the 24th Annual Ocean Conservancy International Coastal Clean Up – the world’s largest volunteer effort of its kind. Panama City Beach is planning to join the 400,000 volunteers across 104 countries and 42 U.S. states by hitting the sand for this grassroots event.

The Panama City Beach Chamber of Commerce “Green Leadership Committee” will spearhead the local event and is encouraging the community, civic organizations, public and private businesses to join in the effort.

The clean up efforts will take place at two main thoroughfares along the Panama City Beach shoreline including Rick Seltzer Park on South Thomas Drive from 8 a.m. to 9:30 a.m. at the Russell Fields City Pier at Pier Park from 4a.m. to 6p.m. Trash bins, gloves and bottled water will be provided.

For more information on the “Green Leadership Committee” and Ocean International Coastal Clean Up Day, contact Marta@PCBeach.org or 850-235-1159 or visit http://www.oceanconservancy.org/site/PageServer?pagename=icc_home.

The Destruction of a Miracle

As I approach the gate at the under-demolition Miracle Strip Amusement Park, I’m greeted by a rough-looking-shirtless dude with his underwear showing asking me what I wanted. “I just want to take some pictures for a local web site,” I said. He replied that he had to ask his boss. I didn’t mean to make much of a to-do about it.

Minutes later, amid steel tracks crunching and clanging across concrete, Mr. Dickens himself creeps my way. “Take a picture of my truck, or bring a 6 pack of beer,” he said, “I gotta get somethen outa the deal.” I’m not sure OSHA would like them drinking on the job. But does OSHA even care about a demo site anyway?

They let me in and I got some great shots.

As I made my way around the park, I strained to recollect the one time I had visited Miracle Strip several years ago. I don’t even remember who I went with, but coming from Dallas, TX, I was used to parks of much more grandeur than this. I remember not being impressed. But, that has nothing to do with the Miracle that was Miracle Strip. Tens of thousands if not hundreds of thousands over the years grew memories here. Talking to my wife last night about my experience, she said she probably went there almost every day for summers (s as in plural). Locals and tourists alike enjoyed the park atmosphere for just shy of 30 years (or longer??).

“I own everything in this fence,” Mr. Dickens said, “from the moment I got this contract, I own everything here; I can do anything I want.” I asked about a banner that I found draped over some of the Red Barron planes. Greedily he replied, “I’m selling everything to make as much money as I can, nobody gave me nuthin, I work for all I got, and people come in here and steal MY stuff.” I was just asking about the banner, not thinking I was going to get a lecture. I told him it might be nice to hang in my garage, he said, “I have 80 acres to hang $#@% on.” Wow. Needless to say, I didn’t get the banner. Wasn’t sure if he was actually wanting to sell some of that stuff, or just keep it all himself for his 80 acres.

The day started off nasty and rainy, but by the time I got there, the sun was out, and it was hot. I made my way over to the Devil ride pondering our fascination with scary stuff. With attractions such as The Dungeon, The Abominable Snowman, The Devil Ride, The Haunted House (sorry I’m sure I’m getting all the names wrong) I got this creepy feeling and yearned for big fluffy bears and the Wiggles.

The whole place was sad, though. So much dilapidation, but a welcome change. The one ride I do remember with quite a bit of distinction was the tower that shot you 90 feet in thee air. I remember the exhilaration and fear crumpling up together in my stomach as I realized I could see all up and down Panama City Beach. That was the kind of ride that I was used to.

I know this place was home to many memories, but the tear down is long overdue. This place has been an eyesore for years, literally and it is time to move on. Talking to a member of the controlling company for the land I was told that no definite plans for the property have been defined. At one point, the property was to be a sprawling resort development, but the market won’t allow that right now. So, who knows, but at least vacant land is a better looker than old dilapidated buildings that attract vandals, homeless, and criminals.

I know we’ve talked about this already, but it’s definitely worth mention again.

http://www.flickr.com/apps/slideshow/show.swf?v=71649

August 2009 Panama City Beach Condo Market Update

During the last 12 months we have seen a meltdown of the financial markets, the stock market tanked, and the housing market continued a steep decline. The Feds invested a significant amount of money to stop the free fall. The question on everyone’s mind is “have we begun to crawl out of the hole”.

The answer to that question depends on your perspective. From a national standpoint, large banks have begun to stabilize but smaller regional banks continue to be at risk due to their exposure to the mortgage backed securities in their portfolio. The stock market has regained approximately 50% of its’ loses. The overall national housing market appears to be stabilizing. However, we are more concerned about the Panama City Beach condo market than the national indicators.

First, the good news. The following chart indicates that the number of sales of condo units from the 70 buildings in our data base is up 7% during the first eight months of 2009 when compared to the same period last year. That is a positive sign. Before we extrapolate that increase for the entire year, we need to look at the history. For the first eight months in 2008, the number of sales was slightly ahead of the number of sales in 2007. However, for the entire year there were 3% fewer sales in 2008 than 2007. Statistically speaking, we will have to wait and see if the number of sales for 2009 will be substantially different than the past three years.

The graph below illustrates the number of monthly re-sales from the 70 Panama City Beach condo buildings in our database. The 2009 monthly re-sales through August appear to be trending somewhat higher than the past three years.

The number of bank related sales, foreclosures and short sales, continues to put downward pressure on current market values. Bank related sales accounted for an average of 43% of all sales within our data base during the first six months of 2009. 42% of the July sales were bank related. There does not appear to be any moderating to the number of bank related sales during the short term.

The market trend line is illustrated below. It is structured to show a sale price trend measured in terms of the percentage sale price as of a particular date. The starting date used was May 1, 2008 so we could show the price trend for the preceding 16 months. We chose units from a variety of buildings of different ages and sizes that had a sufficient number of sales as to be statistically significant. The units used in the analysis were:

Boardwalk Beach; Opened in 2005; 1,380 SF; 2BR/2Ba
Calypso; Opened in 2006; 1,226 SF; 2BR/2Ba
Celadon; Opened in 2004; 846 SF; 1BR/2Ba
Grandview; Opened in 2005; 1,492 SF; 3BR/2Ba
Gulf Crest; Opened in 2003; 1,388 SF; 2BR/2Ba
Emerald Isle; Opened in 2005; 1,146 SF; 2BR/2Ba
Treasure Island; Opened in 2005; 1,370 SF; 2BR/2Ba
The Summit; Opened in 1983; 912 SF; 1BR/1.5Ba
Regency Towers; Opened in 1975; 1,114 SF; 2BR/2Ba
Sterling Reef; Opened in 2005; 1,076 SF; 2BR/2Ba
Splash: Opened in 2006; 1,074 SF; 2BR/2Ba
Seychelles; Opened in 2006; 883SF; 1BR/2Ba

The May 1, 2008 market value for each type of unit was determined by analyzing sales data from January 1, 2008 to June 1, 2008. The sale price of each type of unit is only compared to the typical sale price of that particular type of unit as of May 1, 2008. In other words, a unit type with a May 1, 2008 market value of $400,000 is represented as 1 or 100%. An October 2008, $380,000 sale of that type of unit is depicted as .95 or 95% of the May 1, 2008 sale price. The sale prices and sale dates were charted with a price trend line for each type of unit. The chart contained in the price trend analysis is a trend line of the trend lines of the sale prices of each type of unit from the 12 buildings. Foreclosure sale prices that were unrealistically low (mold problems for example) were not included. There were 153 sales used in the chart. The analysis does not try to skew the price trend in any direction. The data is just the data.

The data indicates that the current market values of Panama City Beach condos have declined approximately 16% over the past 12 months. The rate of decline is similar to the 15% decline from August 1, 2007 to August 1, 2008. The trend line shows a moderating of the rate of decline over the past four months. This is a positive sign, however over the past three years the steepest rate of decline was in the September to February months.

There are several factors at play that will continue to put downward pressure on current market values.

During the market run up the vast majority of buyers were speculators lured by the prospect of easy money. These buyers are no longer in the market. Current buyers are those that actually want a beachside condo in Panama City Beach. Fewer buyers coupled with a supply that far outpaces demand will tend to drive prices downward over the next couple of years.
Financing a condo continues to be extremely difficult for the average buyer. Fannie Mae and Freddie Mac designated most area condo buildings as “condo-tells”. Fannie Mae and Freddie Mac will not buy mortgages backed by “condo-tells”. Financially qualifying for a loan has become much more strenuous. The difficulty financing a Panama City Beach condo means fewer buyers. Fewer buyers mean decreased demand while the supply remains high. The difficulty in financing will put downward pressure on current market values.
There are still a very large number of owners who have a mortgage in excess of $100,000 more than the current market value of their condo. Bank related short sales now outnumber foreclosure sales. A Short Sale is the sale of a condo in which the proceeds from the sale are short of the balance owed on the condo. Typically, banks do not record their intention of accepting a short sale. Public records may indicate a moderating in the rate of foreclosures while the number of foreclosure and short sales combined is not declining. There is no evidence that the number of foreclosure and short sales will decline in the near term. Forty percent of the sales within our data base over the past seven months have been foreclosure or short sale bank related sales. Bank related sales do not appear to be moderating and will continue to have a negative effect on sale prices over at least the short term.
The supply of developer owned units that have not been sold far exceeds the demand. The following chart shows the number of unsold developer units from ten high profile beach side buildings as of 7/24/2009 according to Bay County Assessor and Clerk & Recorder records. There is some anecdotal evidence that Aqua has several contracts that have not closed. There are over 1,000 unsold developer units that will need to be transferred to private ownership at some point. These 1,000 units don’t include the 1,500 plus unsold units at off-beach buildings such as Laketown Wharf. These unsold developer units inflate the supply of available condos and will continue to put downward pressure on current market values.

All indications are that there is more pain ahead for the local market. How far do we have to go before the bottom? It is not unreasonable to assume that sale prices will decline another 10% or more over the next 12 months and that may not be the bottom.

As always, if you lie to yourself about things concerning money, you lose.

Check out our new Panama City Beach Condo Market blog at the web address www.condosaletrends.com/blog.

– Sam Portman

www.condosaletrends.com

AGENDA: CVB Special Called Meeting – Contracts Pending Approval

This meeting is to approve the contracts for both Fahlgren and Lou Hammond as Panama City Beach TDC’s new Ad & PR agencies.

PANAMA CITY BEACH CONVENTION & VISITORS BUREAU, INC.
Panama City Beach
Friday, September 18, 2009
1:30 p.m.
Board Room, Visitor Information Center

I. CALL MEETING TO ORDER

II. ROLL CALL

A. Invocation
B. Pledge of Allegiance

III. REQUESTS TO ADDRESS THE BOARD ON AGENDA ITEMS (3 Minutes)

IV. REVIEW AND CONSIDER FOR APPROVAL CONTRACT WITH FAHLGREN, INC. FOR ADVERTISING AGENCY SERVICES, Ms. Susan Estler, VP of Marketing

V. REVIEW AND CONSIDER FOR APPROVAL CONTRACT WITH LOU HAMMOND & ASSOCIATES FOR PUBLIC RELATIONS AGENCY SERVICES, Ms. Susan Estler, VP of Marketing

VI. AUDIENCE PARTICIPATION

VII. ADJOURNMENT

To download the full agenda click here

Airport Authority Granted $4 Mil for State-of-the-Art Baggage System

The Panama City-Bay County International Airport Authority today announced that it has been awarded a Transportation Security Administration grant of just over $4 million dollars for a new Checked Baggage Inspection System at the new airport now under construction.

The grant will also be used for subsequent modifications needed for TSA to install an Explosive Detection system. The new airport is one of several airports to receive this system.

The state of the art security equipment is designed to enhance screening capabilities and airport safety and also facilitate customer service. Construction of the $318 million airport began in January 2008 and is scheduled to open in late May 2010.

Steve Earnest, Federal Security Director said, “This technology will strengthen security and streamline the baggage screening process.” He added, “This baggage handling system will better enable Panama City-Bay County International Airport to detect explosives and other threats while allowing for the growth of the new airport.”

What this means for you is a faster, safer and more efficient Checkin process, essentially cutting out additional lines and steps in getting you from the counter to the plane. As the representatives explained, this comprehensive system will allow patrons to give their bags at the Checkin counter, which will go through a behind the scenes screening process and out the door back to you safely and without waiting in any additional lines. The new technology will improve workplace safety for TSA employees by automating the baggage screening process, eliminating the need for passengers to walk checked baggage to a screening location and waiting for it to be cleared before proceeding to the security checkpoint. It will be the most up to date, efficient system in America.

The enhanced explosive detection technology also will provide on-screen viewing capabilities for TSA officers conducting baggage screening and reduce the number of re-scans and physical bag searches.

High Toxicity and Turbidity in Grand Lagoon: Remedy

With toxicity and turbidity levels higher than many feel comfortable with in Grand Lagoon, The Friends of Grand Lagoon are discussing the possibility of changing the water out about every 20 days. How to tackle this great task you ask? By bringing fresh gulf water into the most western portion of the lagoon at the rate of 50,000 gallons per minute.

Last night I attended a regular Friends of Grand Lagoon meeting with a guest presenter from the City of Destin. Discussion on the table began with a study presentation of the turbidity and toxicity levels in Grand Lagoon that resulted in the Ecotoxicologist (not even in my spell check library) presenting making the statement when asked, “I would probably choose not to eat my catch from that body of water.”

Many asked if there was any indication as to how much toxicity had come from the sewage spill that resulted from a City of Panama City Beach lift station failure early this year. The presenter had no answer but indicated that the spill could have had something to do with it. However, he stressed the main problem was that the more deep you move into the lagoon, the less likely it is that the water there has been cycled out with new water. Much of it is stagnant and as remarked by a waterfront resident to myself halfway through the evening, “my backyard is a cesspool.”

Well, it should come as no surprise that if we are having an issue with something in Panama City Beach, so might others be having (or had) the same issue. The City of Destin battled this very issue in years past (like more than a decade, although I was unclear how long exactly they had been doing this), and they found the solution to be quite effective. They had gone through some trials and a few errors, but the final result seems to work quite well, indeed.

The solution is to burry a huge pipe and run it under the road and developments, 1,000 feet into the Gulf of Mexico. The land-side of the pipe would be hooked up to a small building that housed electronic monitoring equipment and a 150 hp electric motor that would pump hundreds of thousands of gallons of water into the stagnant side of Grand Lagoon every hour. In Destin, they mostly run the pump at night, during low peak electric time to keep the system efficient and have worked up a system over the years to produce barely any noise at all. In fact, the presenter mentioned that they haven’t received a complaint on the noise in he-didn’t-know-how-long.

So, this is an awesome idea, but who pays for it? Nobody knew. Some talk about employing a grant-writer was tossed around, but then the question came up: who’s land is the facility housed on? The City’s? The County’s? Some willing or perhaps absent private citizen? It was remarked that to even talk to a grant-writer, they would need three times as much as what they have available in their checking account. Donations anyone?

Last night was talk about an issue that needed a solution. The solution seems apparent, but the means by which to get there is still very cloudy. This was actually the first meeting discussed about this particular project indicating that there will be plenty more, and also indicating that at this time, the pipe project is not much more than a pipe dream.

On a side note, no formal discussion was made of the new Grand Lagoon Bridge, but it was remarked to me at some point in the evening that the ground breaking would take place before the end of the month.

SallieMae – 700 Bay County Jobs at Risk

In today’s economic climate it is vital that our legislators support policies that will keep good paying jobs with competitive benefits in our community.

Currently Congress is debating legislation that would make the federal government the sole provider of student loans. Congressman Boyd has been a leading supporter of alternative student loan reform legislation that would allow private sector firms such as Sallie Mae to continue to originate and service student loans.

This alternate plan would save over 700 jobs here in Bay County. We are lucky to have a company like Sallie Mae that brings jobs to this community. It is our hope that Congress will pass legislation that will preserve private sector student lending and the jobs it creates in our community.

We encourage the community to contact our elected officials in D.C. and voice your opinion on protecting the jobs at Sallie Mae. Private business has proven time and time again that it can and does operate efficiently.

A website has been set-up, protectfloridajobs.com, that simplifies having your voice heard and we encourage you to spread the word to your friends and family to please step up and help protect the many families that will be affected should this alternative bill not pass.

Click below to sign the petition.
www.protectfloridajobs.com

Shores of Panama Going All Out For Thunder Beach

Thunder Beach Productions & Oaseas Resorts is the new official location for the infamous Kick-Start Party for 2009 at Shores of Panama Resort. The large, stunning pool deck will now play host to the popular event featuring live entertainment and the Official Miss Thunder Beach preliminaries.

From 6 to 10pm on Wednesday, September 23rd, the beautiful Shores of Panama Resort will kick of what is to be an fun-filled chromed-out weekend! “Shores” is bringing in legendary show band, ELI – the band that defines “High Energy”. Shores of Panama poolside is the perfect setting to get your engines revving for the first Preliminary of the Miss Thunder Beach Pageant. Beautiful ladies, fantastic live music and great food and drink…what a way to crank up your favorite Rally-by-the-Sea!!

When the Kick-Start party is over, just walk or ride next door to Pineapple Willy’s “After Party” – going on until 12:30.

For more information click here to go to Shores of Panama website or here to go to Thunder Beach Productions.

5 Ways to Mentally and Physically Prepare for Thunder Beach

Aside from an investment in ear plugs or Gord’s Chrome Polish, there are other ways pro and anti-Thunder Beach participants can prepare for the twice-a-year event that can make it an overall better experience for everyone.

1. Signage – Don’t expect bikers, or anyone for that matter, to know your rules if you don’t have them visible. Know your boundaries and set them. If you don’t want the bikers to do burnouts in the parking lot of your establishment, you’d better say so. But beyond the rules you set, there also needs to be a reminder, posted throughout the city, for bike safety. Use signage to express your limits as an establishment as well as to remind those in vehicles to be conscious of those on bikes.

2. Be Informed – Know the Venues. Anyone who does not care for Thunder Beach knows how frustrating it is to want to go to your favorite restaurant only to find all the parking spaces taken up by Harleys. Know the venues so you either know where to go or where to avoid. If you are a biker, knowing the venues helps you keep bikes off the neighborhood streets which in turn makes Panama City Beach residents happy. Residents should know the venues and so they don’t accidentally take a van-full of kids into the heart of a raucous event. Currently, the posted venues for the event are Frank Brown Park, The Shoppes At Edgewater featuring Rock’it Lanes, The Boardwalk Beach Resort, Club La Vela, Sharky’s Restaurant & Tiki Bar, Pier Park, Pineapple Willy’s

3. Staff – As we near the end of the season, cutting back on staff is the last thing you want to do before this type of event. Let this be your rehearsal for Spring Break. Not that Bikers will be anywhere near as rowdy as breakers, especially during the Fall rally which is subdued compared to its rowdier Spring sibling, but having a knowledgeable staff that knows how to handle crowd control makes everything run smoother and can give you peace of mind on those thunderous nights.

4. Make Early/Alternate Plans – If you don’t like the bike weekend and want to avoid the whole scene, make plans to go out rather than sit at home and sulk. Head into to town for Panama City Downtown Friday Fest, take the kids over to the Skate Factory just off Harrison avenue or go see a show at the Marina Civic Center. There’s lots to do when the bikers take over the beach.

5. Expect a Bad Apple, But A Relatively Good Barrel – Don’t let one bad apple make you cringe at the thought of the entire event. No doubt, there are a million Thunder Beach horror stories you or anyone can tell, but I can assure you there are equal if not more positive stories about the thunderous occasion. Bikers, for the most part, are good people who spend loads of money to come to Panama City Beach and enjoy their favorite hobby with others. Yes, the pipes are loud, but you have to consider that even the loud pipes you love to hate are for safety purposes. Go into the weekend expecting a few bad apples in an overall good batch and you’ll have greater peace of mind for it.

Thunder Beach Weekend starts September 24th and goes through the 27th. For more information on the event please stop by www.thunderbeachproductions.com