Change is coming slow as Fort Myers Beach continues rebuild

Two years after Hurricane Ian came ashore and decimated Fort Myers Beach, the long-anticipated — and much-feared — transformation of the Lee County barrier island has yet to materialize.

Yes, big deals have been announced. Yes, plans have been made to build on parcels once considered sacrosanct. And yes, what’s coming next will likely differ from what’s attracted people for generations.

But the action needed to transform the ideas into reality are being deliberately slow-walked by both city officials and developers in an effort to make sure the future of the island is one most everyone agrees on, a hybrid of the beloved old and the necessary new.

“I think it's a mixed bag on why” the process is moving slowly, says Justin Thibaut, CEO of local commercial real estate firm LSI Cos. “But it all boils down to, I think, there's a little bit of reluctance to nail down and make a decision on what Fort Myers Beach is, was and will become.”

Photo by Steffania Pifferi

In the 24 months since Hurricane Ian struck Fort Myers Beach — it hit Sept. 28, 2022 — residents and officials have been dealing with the duel exercise of rebuilding and redefining life in the beach town. During that time, residential and commercial real estate sales have fluctuated, with investors stepping in to pick up distressed properties.

While housing has seen signs of a recovery and renewal, the big dollar deals in the commercial sector have yet to yield visible results as the approval process has crept to near standstill.

The island, a vacation destination for generation sand home to thousands, was left largely in ruins so bad that months later rubble still lined Estero Boulevard. Even today, as the two-year anniversary of Ian approaches, you can still see boarded up buildings and some wreckage.

That's what sticks out to a local photographer, who, upon seeing the area six months after the storm and then again Sept. 19, says she didn’t realize how much it still looks like a war zone,

But there is some progress.

Time is money

Fort Myers Beach Mayor Dan Allers says homes are being rebuilt, business are opening and condominium units are coming online. It may not be at the speed people hope, want or expect, but given the magnitude of the damage overall things moving along.

“Nothing ever moves as fast as we'd like it to,” he says.

One of the holdups he and others say is the deliberate process underway as the town works on updating some of its codes and regulations that will guide decision making in the future.

There is also the matter of four larger parcels — the former Red Coconut RV Resort, Sandpiper Gulf Resort, Outrigger Beach Resort and Silver Sands Villas — that have been sold to developers, raising fears that massive developments will suddenly appear and permanently alter the island.

Allers says developers have been speaking with citizens about what they hope to do on those properties and there is a long bureaucratic road ahead for those projects. And, he adds, there is no guarantee they, or any large development, will win approval.

Thibaut, the real estate executive who grew up in the area, says that there will be conversations and people will get their say, the reality is that the desire to keep Fort Myers “what it was” isn’t possible.

That’s in part because of the large number of regulations — from FEMA flood map revisions to revised building codes — that will affect building heights and density moving forward. Like other parts of Florida recovering after a hurricane, another issue is most of those regulations and codes weren’t in place when much of what’s beloved on Fort Myers Beach was built.

While there is a lot of talk about what will happen with cottages and smaller commercial sites along Estero Boulevard, Thibaut believes what’s is going to set the tone for what is allowed in the years to come are the decisions made on the four big large parcels.

“It’s still frustrating because we'd love to see some redevelopment happening,” he says. “And it will happen, probably, relatively soon, but not until we get answers on the direction that the town of Fort Myers Beach wants to head.”

The homefront

On the residential side of the market there has been a slow down as well, but its issues and history in the two years since Ian are somewhat different than commercial. 

There are, of course, some similarities — questions about how and what to rebuild — but its main slowdown is market driven.

Ian hit after the real estate market in Florida and across the country had heated up following the pandemic in 2020.

By the middle of 2022, and heading into the latter part of the year, though, there were some moderate transactions. Then Ian sales slowed even further, as people waited to see what would happen next. 

But things changed in early 2023: there was a boom.

Some of it had to do with properties that rarely went on the market now for sale. These were properties in prime locations — on canals, with extra feet of water frontage, with intersecting views — that owners typically held on to but were moving on from for a host of reasons.

There was also something else: speculators.

“We literally worked with investment buyers that say, ‘We've done this every major storm, like category four or five, for the last 20 years,’” says Tiffany Burns, with Premier Sotheby's International Realty.

These storm chasers, as she calls them, swoop in after a storm, buy a property to be fixed up and then resell it.

But it hasn’t really worked out for for them — so far — because of the macroeconomic realities of the market and the fact that there is still a recovery underway. Many are now renting out their properties.

image courtesy of Premier Sotheby’s International Realty

Consider this metric Burns shares to illustrate this point: The median sale price on Fort Myers Beach rose from about $700,000 in late 2022 to more than $1 million midway through 2023 before dropping back toward the end of the year. On a chart, it's a narrow upside-down V.

Burns, though, believes the market will rebound.

Working with the investors she learned that a recovery doesn’t happen nearly as fast as people hope or expect and that there is a sort of timeline one can track.

While there is an initial uptick in sales and value as FEMA, insurance and investor money pours in along with government resources, things begin to taper off about 18 months in and there is a dip.

This seems to be the point Fort Myers Beach is at right now, Burns says.

“When you get a little further along in the recovery, then people can see the light at the end of the tunnel,” she says.

“Then property values appreciate again and, often, go to levels that they never would have reached without the storm. Because the storm comes in and makes everything new.”