St. Joe Company


St. Joe Company

Infobox Company
company_name = The St. Joe Company
company_
company_type = Public (NYSE|JOE)
foundation = 1936
location = Jacksonville, Florida
key_people = William Britton Greene, President and CEO
William S. McCalmont, CFO
Christine M. Marx, General Counsel
industry = Real estate development
products = Residential, Commercial & Rural land; forestry products
revenue = < US$ 377 million (fiscal 2007)
employees = 337
homepage = http://www.joe.com/

The St. Joe Company (NYSE|JOE), located in Jacksonville, Florida is a land development company and Florida's largest private landowner, owning about convert|805000|acre|km2|-1 in the state [ [http://finance.yahoo.com/q/pr?s=JOE Yahoo Finance: company profiles-The St. Joe Company (JOE)] ] .

Beginning

The company was originally founded in 1936 as part of the Alfred I. du Pont trust by du Pont's brother-in-law Edward Ball.Fact|date=August 2008 What eventually became the St. Joe Company bought its first piece of land in 1923. [http://www.joe.com/web/JoeStory/ St. Joe Company website: St. Joe Story-page 1] ] During the land booms in south Florida, the company acquired land in Florida's panhandle that nobody else seemed to want. The purchases continuted throughout the 1940s and 1950's, often for "mere dollars an acre." Ball despised the thought of paying taxes to the government, so to avoid them, he rarely sold anything; preferring instead to plow profits back into more land purchases.

t. Joe Paper Company

In anticipation of increased trade through the Panama Canal, the Apalachicola Northern Railroad extended its network from Chattahoochee to Port St. Joe in 1910 with plans to load large ships with goods to be taken through the canal, advertised as the “Panama Route”. When the depression hit, business dropped off and the railroad was in bad shape financially. Alfred I. DuPont purchased the struggling railroad in 1933 and created the St. Joe Paper Company. Dupont drew up elaborate plans for the development of his mill town as “The Model City of the South”, and then died. His brother-in-law, Ed Ball, took control of the St. Joe Company in 1935 but never acted on the master city plan.

Construction began in 1936 and from 1938 to 1996, the company operated a paper mill at Port St. Joe, Florida. [http://www.h-net.org/reviews/showrev.cgi?path=281131086612921 Humanities & Social Sciences Online: "Green Empire: The St. Joe Company and the Remaking of Florida's Panhandle" by Kathryn Ziewitz and June Wiaz-2004 ISBN 978-0-8130-2697-8] ]

The company invigorated the local economy following the depression, employing thousands at its paper mill, but wreaked havoc on the environment. The mill released sulfurous exhaust and dioxins, a toxin, used in the paper bleaching process. By the 1950s, the company was drawing 35 million gallons of water a day from the Floridan Aquifer, seriously depleting the water table. St Joe Paper also clear-cut millions of acres of old growth forest, engaging in silviculture to replant the areas with slash pine. The practice decimated the native longleaf pine stands, reducing the species to "2 percent of its former range." Because of this, the United States Department of the Interior designated parts of the region a "Critically Endangered Ecosystem".

Under Ball, the company also kept workers at the mill racially segregated.

The paper mill was most profitable in the 1960s with products being directly marketed to company-owned box plants. However, a 9-month millworker strike in 1996 signaled the beginning of the end for the mill. Stricter environmental regulations would have required St. Joe to upgrade the mill’s technology at a huge cost while market prices for containerboard fluctuated and continued to drop.Fact|date=August 2008 After nearly sixty years, St. Joe decided to get out of the paper business.

The mill was sold in 1996 to Florida Coast Paper for $390 million while the workers were still on strike. The mill was closed in August, 1998 [ [http://findarticles.com/p/articles/mi_qa3636/is_200003/ai_n8893586 Pulp & Paper: March, 2000-Florida Coast Paper mill to stay shut] ] and did not reopen. It took two years to demolish, but the former mill was gone in 2003.Fact|date=August 2008

Talisman Sugar Corporation

St. Joe acquired the Talisman Sugar Company in 1972, which included almost 50,000 acres in Palm Beach and Hendry counties in the Everglades. St. Joe received negative publicity for their south Florida sugar cane business from labor unions and environmental groups. Cesar Chavez of the United Farm Workers claimed that the conglomerate's sugar plantation in the Everglades was keeping workers in peonage and not allowing them to organize.Talisman's operation had been regarded as the worst environmental offender among south Florida's sugar planters. Eventually, the company struck a deal with the federal government and state of Florida to sell its sugar business as part of an Everglades restoration project. The state of Florida paid $133.5 million in 1999 to St. Joe Co. for the 50,960-acre Talisman Sugar Plantation. [ [http://tampabay.com/news/politics/state/article640598.ece St. Petersburg Times: June 24, 2008-Florida to pay U.S. Sugar $1.75-billion for 187,000 acres in Everglades by Alex Leary and Jennifer Liberto] ] As part of the deal, the company was allowed to continue using the land for an additional five years until the actual restoration project began. St. Joe then contracted the land to Florida Crystals and other sugar growers and received $19 million in rent, so the company received a total of $152.5 million. [ [http://www.answers.com/topic/florida-crystals Hoovers.com: company profile-Florida Crystals Corporation] ] In order to utilize some portions of the Talisman property which were not contiguous, land swaps with other sugar growers were necessary. [ [http://www.ussugar.com/sugarnews/everglades/exit_aids_everglades.html Miami Herald: April 30, 2004-Firm's M'S Exit Aids Everglades by Eliot Kleinberg] ]

Florida East Coast Industries

Florida East Coast Railroad (FECR) was founded by Henry Morrison Flagler in the 1880s. The Wall Street Crash of 1929 dealt FECR a blow it would spend decades trying to overcome. The railway declared bankruptcy in 1931 and would spend the next 30 years in receivership. A hurricane on Labor Day, 1935, wiped out the Key West Extension. Rail all along the Atlantic Coast faced new competition from U.S. Highway 1, completed in 1938, which stretched from Maine to the Florida Keys.A controlling interest in Florida East Coast Railroad was acquired by Ball for the du Pont Trust in 1961.On October 9, 2000, JOE spun off to its shareholders the 54% equity interest in FECI through the distribution of FECI Class B common shares.

Post Ball era

Following Ball's death in 1981, the company began to sell off most of its industrial operations.Subsequently, the company has focused primarily on land development. As a developer, St. Joe has distinguished itself as catering to more "well-heeled" clientele, but has also established a reputation as more environmentally friendly than under Ball.

From their Jacksonville corporate headquarters, the company operates through four segments:
*Residential Real Estate develops large-scale, mixed-use resort, seasonal and primary residential communities, as well as selling housing units and home sites to retail customers and builders.
*Commercial Real Estate develops and sells commercial properties, including retail properties, multifamily parcels, office parks and commerce parks. St. Joe also owns a portfolio of office properties located in the southeast US.
*Rural Land Sales markets parcels for various rural residential and recreational uses in northwest Florida. It sells parcels of undeveloped land and developed home sites within rural settings.
*Forestry grows, harvests and sells timber and wood fiber. Its’ products primarily include pine pulpwood, timber and cypress products.

Some of St. Joe's most profitable deals came from selling conservation land to the state. A total of some 90,000 acres (360 km²) were purchased by the state for $182 million. The works out to an average of over $2,000 per acre--not a bad return on land that, according to the company website, was often purchased for "mere dollars an acre".

Return to Port St. Joe

Interestingly, as soon as the papermill was gone, the St. Joe Company was back in town to unveil a $344 million plan for the former mill site that was similar to Alfred du Pont's idealized Southern town – an integrated city with upscale residential districts, entertainment venues, a thriving port and a diverse economy.

“It would have been easy for us to turn our backs on this town,” says John Hendry, vice president of strategic planning for the St. Joe Company, “but that wouldn’t make sense for us. Port St. Joe is a fundamental part of the St. Joe Company, and we are a fundamental part of this town.”

The company made a deal with the State of Florida to re-route US 98 inland to permit development of beachfront property.Fact|date=August 2008

Airport

The company has begun trying to market the panhandle region as "Florida's Great Northwest" and is involved with plans to relocate and drastically expand Panama City-Bay County International Airport in the hopes that a larger airport will attract wealthier home buyers. St. Joe owns about convert|78000|acre|km2|0 of land in the area surrounding the new proposed airport site, and has announced plans to build 5,800 homes and convert|4300000|sqft|m2 of commercial space. The company has also offered to donate about 40,000 acres (160 km²) for preservation. The project has attracted quite a bit of opposition, including taxpayer and environmental groups who point out that the current airport is operating at only half its capacity — with 12 outbound flights a day - and the new facility will primarily benefit one developer, at taxpayer expense.

Tough times

Since the national downturn in the real estate market in the mid-2000s, the company's sales suffered, with earnings dropping off by 60 percent in 2006. [http://www.nytimes.com/2007/05/09/us/09airport.html New York Times: May 9, 2007-In a Quiet Part of Florida, a Bid to Bring in the Crowds by Abby Goodnough] ] As a result, the company cut its workforce, exited the homebuilding market and sold its office holdings. [ [http://www.hoovers.com/st.-joe/--ID__15222--/free-co-factsheet.xhtml Hoovers Business Intelligence: The St. Joe Company] ]

References

External links

* [http://www.joe.com/ Official company website]
* [http://finance.yahoo.com/q?s=JOE - Company profile at Yahoo!Finance]


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