'Place to Be'

'Place to Be'

development by Janet Leiser | Senior Editor

A condo glut doesn't deter EcoGroup's principal from building New Port Tampa Bay - a luxury waterfront community where the land alone cost $74 million.

Ed Oelschlaeger paid dearly, more than $1 million an acre, for more than 50 acres on Tampa Bay he's remaking into an upscale village, where the least expensive condominium will sell for nearly $400,000.

Not that the developer is complaining.

"What major city in the United States can you go buy 54 acres of waterfront property and basically have a blank sheet of paper to start with to paint a masterpiece?" Oelschlaeger, 61, says of the land, much of which was industrial.

His masterpiece will include condos, town houses, a grocery store, offices, shops, restaurants, resort hotel and marina, and is expected to generate about $1.3 billion in revenue for EcoGroup over the next decade. The Tampa firm has developed condos from Naples to Longboat Key to Pinellas over the past 20 years. New Port Tampa Bay, though, is Oelschlaeger's signature project.

Despite a condo glut that has some developers slashing prices and offering incentives such as a new Mercedes with the purchase of a unit, EcoGroup's sales have exceeded $55 million on New Port's first condominium towers, Marina Tower I and II, since July. That's about 30% of the 218 units in those buildings.

"We're doing quite well given market conditions because the market has certainly softened," Oelschlaeger says.

Still, he says the Tampa market is remains stronger than other parts of the state, including Naples where EcoGroup is developing Aqua Pelican Isle Yacht Club, two waterfront luxury towers.

Skanska USA recently began construction on New Port's first two towers, which should be completed in the first quarter of 2009.

The project is in South Tampa near Gandy and West Shore boulevards, a short drive from downtown Tampa and downtown St. Petersburg, as well as the Westshore business district. He expects it to attract professionals tired of spending hours commuting from Carrolwood, Brandon or Tampa's other distant suburbs.

"It'll be the place to be," he says.

Oelschlaeger acknowledges New Port Tampa Bay hasn't met projections, but he points out that it's one of the few local projects to recently come out of the ground. New Port's lead bank is Bank of America.

Surviving the downturn

What is the secret to EcoGroup's success?

"I really wish I could give you a simple answer," he says. "It really is a combination of many things.

"We've seen the cycles. I've been in this business for over 30 years. You just have to have confidence in what you're doing and the people that you surround yourself with. It's a difficult business to begin with. Now it's more difficult."

Top of the list for success, though, is location. Yes, that old adage location, location, location holds true, he says, adding: "I would not want to be doing a non-waterfront condominium right now."

That's not a new rule for EcoGroup because of the slowdown. All of the firm's projects, known for their luxurious amenities, have been on either the water or a golf course since Oelschlaeger founded the firm two decades ago.

To sell in today's soft market, he says, it's important to know who EcoGroup's target customers are for New Port and what they want.

"We just have to pay attention and work harder at what it is we do," he says. "It's a combination of having the right property in the right location and creating a product and communicating that lifestyle, that concept to the market in a way that people understand it."

Those buying primary residences at New Port tend to be families that are downsizing, young professionals and retirees. About 25% of New Port's target customers are people looking for a second home.

Not far from New Port, developers are building condominium towers in downtown Tampa and Channelside, for the first time in the city's history.

Is Oelschlaeger worried?

"We don't view Channelside as competition," he says matter-of-factly. "It's different. They're much more affordable, entry-level housing for the most part."

In contrast, New Port offers more amenities, including fitness centers, theaters, concierge services, and, of course, the slips for yachts.

The project was initially expected to take seven to eight years to finish, but it might take a decade because of the soft market, he says, adding, "We're taking a longer range view of things because we have a community to build."

Some aspects of New Port are being accelerated, he says.

For instance, EcoGroup will soon announce a joint venture to develop a major retail/commercial center. It's also expected to include a residential component.

The firm is also negotiating a contract for the development of a commercial building at the corner of West Shore Boulevard and Tyson.

In addition, EcoGroup is talking to other developers interested in building luxury rental apartments, an assisted living facility and a resort hotel at New Port, he says.

Smart marketing

Oelschlaeger, who worked for Deltona Corp. in Miami before founding EcoGroup, says he has learned to be creative with marketing in recent years.

For instance, the kick-off event for New Port in January of '06 included $40 million in yachts, Cirque-style performers, a huge tent, live music, champagne and other entertainment.

The idea was to give would-be residents a taste of what life will be like in the urban oasis, he says.

Earlier this month, EcoGroup partnered with upscale retailers such as Neiman Marcus, Reeves Import Motorcars and Galati Yacht Sales to hold an event attended by about 300 people. It included a fashion show, cars, boats and entertainment.

"We're working together to maximize the benefit," he says. "What we're trying to do is reach our customers as are our partners trying to reach their customers. We're also trying to demonstrate what New Port will be about in terms of the lifestyle."

Not all of those who attend will buy.

But they fit EcoGroup's target demographics.

Review summary

Company: EcoGroup Inc., founded by Ed Oelschlaeger

Industry: Real estate development

Key: It's true, location is of utmost importance, says principal Ed Oelschlaeger. All of EcoGroup's developments over the past 20 years front either water or a golf course.

EcoGroup's Developments

New Port Tampa Bay*, Tampa

Aqua Pelican Isle Yacht Club*, Naples

Barefoot Beach Club, Naples

Pelican Isle Yacht Club, Naples

Sancerre, Naples

The Sanctuary Golf Villages, Sanibel Island

The Tides Beach Club, North Redington Beach

Vizcaya, Longboat Key

*Only developments still under construction.