Going from the buttoned-up Chicago boardrooms of Northern Trust to the fields and forests of Schroeder-Manatee Ranch (SMR) required a wardrobe adjustment for banker Mary Fran Carroll.
When the bank suggested that she represent a member of Milwaukee’s Uihlein family, and a major Northern Trust client, on the SMR board of directors in 1976, she worried that Northern Trust’s strict dress code wouldn’t sit well in laid-back Manatee County.
So she showed up in Florida for a meeting wearing flat shoes, a cotton skirt and no stockings.
At one point in the meeting, recalls Carroll, “Rob Uihlein, who had been shy about saying anything, looked at me and said, ‘This outfit has to go! We’ve got snakes, we’ve got red ants. You’ve got to get some boots, for God’s sake,’” recalls Carroll.
She returned to Chicago and bought some boots. A good footwear choice, as soon she became chairman of SMR, leading its transition from a vast and remote farming, ranching and mining operation to the site of one of the state’s best-known master-planned communities.
SMR’s 8,500-acre Lakewood Ranch, which is celebrating its 15th anniversary this month, now has more than 15,000 residents in seven villages, 1,200 businesses, three golf courses, several schools and colleges, a hospital, a number of churches and a well-known polo club. About 24,000 acres remain for agribusiness (SMR Farms and SMR Aggregates), but clearly Schroeder-Manatee Ranch is best-known for growing houses, neighborhoods and office buildings.
It was a change the Uihlein family felt compelled to make, said Rex Jensen, SMR Inc.’s CEO.
The land now occupied by Lakewood Ranch once was coveted as a happy dumping ground for municipal leaders in Sarasota and Manatee counties, said Jensen.
Where homes, golf courses and commercial/retail buildings now stand in Lakewood Ranch, local authorities once pondered putting the Sarasota-Bradenton airport, a landfill and a 2,000-acre site for the spraying of treated waste water piped 10 miles from the City of Sarasota’s sewage plant.
A target
Lakewood Ranch’s first models opened in February 1995, but its creation really dates to around 1980. That’s when the Uihlein family, which owned the then-28,000 acres of Schroeder-Manatee Ranch, looked around and realized their land had become a target.
In 1977, the airport authority announced its intention to build a new airport near the Sarasota-Manatee county line, well east of current development. The authority had considered the matter as early as the late 1960s, according to accounts in the Herald-Tribune, even though a poll taken on Election Day 1970 showed that two-thirds of Sarasota voters were against moving the Sarasota-Bradenton Airport from its location between U.S. 41 and 301. Not that they knew much about the new location: Schroeder-Manatee was unknown to most citizens, and before the 1970s, when the airport issue heated up, was mentioned in the Herald-Tribune only rarely.
Airport-authority member, and later Sarasota County commissioner, Jeanne McElmurray called a study of the proposal “the biggest waste of taxpayer money I’ve ever seen.”
Another opponent of the move was the late Gloria Rains, a local environmental icon who founded ManaSota-88. She wanted the hinterlands to be left alone, which eventually meant she opposed SMR’s self-development, too. “She was our nemesis,” said Carroll, although it was reported in 1997 that Rains eventually praised Lakewood Ranch’s preservation of natural features.
But the other airport-authority members favored the move -- a number of sites were considered 10 to 20 miles east of the current airport -- and Jensen said that concerned the Uihlein family, which had purchased the 48-square-mile Schroeder-Manatee Ranch from the John Schroeder family in 1922.
Schroeder had assembled the ranch from various pine plantations about 10 years earlier. The Uihleins were one of Milwaukee’s leading families as owners of the Jos. Schlitz Brewing Co. for more than a century, taking control after Joseph Schlitz died in an 1875 shipwreck off the English coast.
The airport proposal “actually is what got people thinking about forming a vision for this property,” said Jensen. “If they didn’t, they would be a dumping ground, if you will, for every use that the established community wanted to have somewhere nearby -- but not in their backyard.”
Schroeder-Manatee Ranch had several attributes that made it appealing as an airport site. First, it was “way out east,” so jetliner noise would be kept away from residential areas closer to the coast. Second, it was an enormous, single tract with one owner of about 20,500 acres in Manatee and 7,700 acres in Sarasota.
But many residents of Sarasota and Bradenton criticized the SMR site as being too inconvenient.
It is a criticism that lingers to this day. Although Lakewood Ranch has grown steadily for 15 years, some people still think it is too far out.
The big difference between the SMR of 2010 and the SMR of 1980, though, is Interstate 75. Completed through Sarasota and Manatee counties in the mid-1980s, it created a new regional “Main Street” virtually at SMR’s front door. Without I-75, Lakewood Ranch “probably wouldn’t exist,” said Jensen. “One of the things I-75 allows Lakewood Ranch to be is an economic development hub.”
Setting the vision
As the Uihlein (pronounced E-line) family was beginning to focus on the airport issue, Mary Fran Carroll was elected, in 1976, to a seat on SMR’s board of directors so that she could see “what they should be doing,” she recalled in a recent interview.
Back in Wisconsin, Carroll said, Marie Uihlein, widow of former Schlitz president and chairman Erwin “Ike” Uihlein, who died in 1968, had realized she was entitled to a seat on the SMR board and sought Northern Trust’s help. She was one of the bank’s largest trust customers, said Carroll, who headed Northern’s Family Business Division at the time. Carroll would represent Marie Uihlein’s best interests and the bank would be paid for Carroll’s time.
“I wasn’t a Milwaukee lady, I wasn’t an Uihlein. I was hired help,” Carroll said recently. That was a good thing, as “no Uihlein can ever be bigger than another Uihlein” on the board, and the family was beset by internal squabbles, she added.
“I brought the family together,” said Carroll, who became chairman of the board of SMR in 1980. “Prior to this, they really were not very good friends at all. The older people never got to the point that they would walk hand in hand, figuratively speaking, but at least they would walk with me and hold my hand. The older people trusted me and the younger ones respected me, and that was the key to the whole thing.”
She made up a questionnaire for the 11-member board to determine what they wanted from their investment in land purchased 60 years earlier.
“I said, ‘We could sell it now. The interstate is coming along and you could get a good price for it,’” said Carroll. That might have been something to consider, as Schlitz Brewing was struggling and went out of business in the early 1980s.
“On the other hand, we had the agricultural operations,” said Carroll. “Of course, they never made any money. They had to borrow money to fund the crop the next season. But they would like to make a contribution to the ecology and all that, and keep the farming and mining.
“They did not want any dividends because they had enough ordinary income. They wanted a capital-gains payout in the third generation. And they are getting that in spades, right on time.”
Masterful planning
A lot of that profit, of course, is coming from the development of Lakewood Ranch. But an awful lot of planning went on before the first houses were sold in the village of Summerfield in 1995.
SMR studied various master-planned communities elsewhere in the country, including those done by the Irvine Company in Orange County, Calif. “They hired a consultant ... to do a study,” said Jensen, “an inventory of (SMR’s) physical conditions, water, soils and vegetation, wildlife, one of those characteristics being the market, and coming up with a series of ultimate development alternatives and phasing strategies.”
In the early 1980s, SMR, under its president, Doug Wilson, designed a destination resort project called Cypress Banks, near State Road 70, spending $500,000 on engineering, design and legal work. “It had 1,800 acres, three golf courses, 5,000 units of mainly condos, and a 300-room Ritz-style hotel,” said Jensen.
Its DRI (Development of Regional Impact) documents were was submitted in 1984. In 1987, Wilson said the project was basically dead after the county rejected it. “The resort is gone forever,” he said in an April 1987 Herald-Tribune article. But that didn’t last. After Manatee finished and approved its comprehensive plan in December 1989, Cypress Banks was OK’d. The same night.
Wilson was right, though: It would never be built. At a time when the country was dealing with the savings and loan crisis and slipping into a real estate recession, Cypress Banks faced a big problem, despite its government approvals.
“There was no market for that kind of thing,” said Jensen. “They had spent so much time and so much money on that DRI that they wanted to get that DRI completed and done.
“But once they completed this DRI process, they had to confront another reality. And that is, a permit doesn’t mean a damn thing. There is a bigger world out there and you have to have other things with permits to make it worth anything. One is a market.”
The DRI approval was crucial in SMR’s development history, though.
“The Cypress Banks DRI was valuable in that it vested a lot of development rights in SMR, which they would not have had,” said Neal Communities President Pat Neal, who worked with Wilson on the project and has built houses in a number of Lakewood Ranch neighborhoods, including his current development, Central Park.
Cypress Banks also underscored the importance of SMR retaining control over its most important asset: land.
“There was one idyllic, unrealistic vision when they were trying to get Cypress Banks through,” said Jensen. ”‘We get this DRI approved and we are going to have developers lining up around the block cutting us checks.’ Life ain’t that easy. And if it is, you are really giving up control of an asset to the hands of others, and it becomes a tower of Babel. But we didn’t.”
SMR’s model continues to this day: release land to developers and builders in an orderly fashion as the market demands it.
New leadership
A tall, genteel Kenyan born to British parents, John Clarke became SMR’s president in ’89. He was an experienced property manager, handling 50,000-acre farms in Arcadia and Immokalee, but had no experience in residential development. Yet he did have good instincts, said Jensen, and put the kibosh on Cypress Banks.
“In his insightful way, he said there is no market for this project, and ‘if we try to implement this ourselves, we’ll go broke.’ Usually on projects like this, it’s the third guy in the door who makes money. It’s not the way he wanted to lead SMR into the real estate business.”
“It was difficult,” said Clarke in a recent interview, “because the market had collapsed, and the thought of breaking ground east of the Interstate, where there wasn’t even the thought of a market, let alone a project that was to be a major resort.”
So Clarke looked for someone to help him take the entitlements for Cypress Banks and another project called University Lakes, and determine what to do with them in the market that existed. “Unfortunately, he found me,” said Jensen, who had spent much of his career as an attorney.
As vice president for real estate, Jensen joined the SMR organization in 1990. Attention was turned to commercial projects, such as Town Center on the Manatee County side of University Parkway, and Corporate Park on the Sarasota County side. Clarke chose John Swart to head the commercial development division.
Clarke and SMR’s cowboys loved to play pick-up games of polo on their quarterhorses. Robin Uihlein (the only Uihlein family member who lives here) loved polo, too. Thus was born the idea for SMR’s first real estate development to come out of the ground.
“In the dark of night, we did the Sarasota Polo Club,” said Jensen. “Basically, Sarasota County’s regulations allowed us to do it with no process to speak of. We didn’t have to file a plat or anything.
“They changed it immediately after that.”
“Back then, University Parkway was a long, dusty shell road,” Robin Uihlein is quoted as saying in an article on the polo club’s website. “We would hold events like the Ringling Cup and some big charity events, and it was pretty incredible to watch Mary Fran Carroll get people to come out here. They’d scoff and say, ‘Come on, there’s nothing east of the Interstate!’ And she’d say, ‘Oh, yes there is; trust me!’ So people would come in their fancy cars and fancy clothes and drive down this dirt road; stuff would be flying everywhere. But they came.”
Said Carroll, “The next year they came out and the road was paved, and it had sidewalks. The next year there were houses! That Polo Club gave us a kazillion in publicity that you couldn’t, with an ad, ever get. It was an identity; it was something different.”
Paying for it
In 1991 and ’92, SMR and Jensen worked to flesh out the ranch’s development plan and get the commercial projects approved. “We were in a cocoon stage,” he said. “We still had to figure out what markets to penetrate. We had to figure out how the hell to finance this thing. We were at the end of the S&L crisis and there was no long-term money.”
The answer: community development district (CDD) bonds, basically a second property tax for home buyers. It allowed SMR Communities, the new residential arm of the ranch, to build infrastructure up front and pay for it over 30 years.
“We fell upon the CDD idea early on,” said Jensen. He said he was shocked to read not long ago in some old SMR documents that the idea had been floated a decade earlier by an SMR staffer who noted, “Out in California, we do this.”
“They never pursued it,” said Jensen. But Manatee County went for it, and approved the community development district, Lakewood Ranch, in 1993.
The next key player had to be someone who knew how to plan a residential community.
From The Meadows
to the Ranch
Developers were giving Jensen a lot of advice, and he did not agree with all of it. One urged him to build homes close to the Interstate, regardless of the traffic noise.
“It was that kind of response that told us we have to do it ourselves,” Jensen said. “We have to staff up and find someone who knows the community development, and we found a guy named Roger Postlethwaite. He understood what a community was. He understood that something of this size had to cater to a number of people of different walks of life, and that you could have a project or you could have a community, and there was a big difference between the two.
“He helped steer us through the exercise of what niches we should have represented in this community, what should we lead with (affordable homes for working people in Summerfield), what should we evolve to after that (more upscale product at Edgewater and Country Club). And we built an organization on the residential side.”
Postlethwaite, a native of England, made his local reputation as developer of The Meadows, a Taylor Woodrow master-planned community in Sarasota developed in the 1970s and ’80s.
Postlethwaite knew of SMR because it is only a half-mile or so east of The Meadows’ eastern boundary. But Taylor Woodrow wanted him back in England for another assignment. Postlethwaite flew to the U.K., realized his home was now Florida, and returned in 1992. Soon he met Clarke and was offered the job of president of SMR Communities, the residential development arm of Schroeder-Manatee Ranch.
“What impressed me was how wonderfully managed the ranch was,” said Postlethwaite in a telephone interview from his office in Jacksonville, where he is now an executive with a real estate development company called GreenPointe Holdings. “That was a nice surprise for me.”
Besides coming up with the name Lakewood Ranch -- “It was fairly simple: The ranch was made up of lakes and woods” -- Postlethwaite refined the broad master plan into a collection of villages, each with its own identity and market position.
The first, Summerfield, was “very much targeted to people who worked in Bradenton and wanted to live in a master-planned community, but could not find one that was affordable to them.” Houses started at $89,000, and sales were brisk. By 2000, Lakewood Ranch had 2,000 residents in Summerfield, Edgewater and Country Club.
Fear of commitment
By 2010, Lakewood Ranch was supposed to be nearing buildout with 15,000 residents, according to newspaper articles of 15 or 20 years ago. It now has those residents, but buildout has become a shifting target.
Jensen says there is no target date to stop developing real estate, or ranching, or anything.
“What business are we in?” asks Jensen. “Asset management. I’m in real estate, not because I want to be in the real estate business, I’m in agriculture not because I want to farm, I’m in mining not because I want to mine. We are in those businesses because they are the best things to do with this asset at this time.
“I want to position this property so that as the market changes and life changes, it can change with it. There is no commitment to do anything. There is no commitment to do more buildings. It just seems to make sense at certain times.”
http://www.heraldtribune.com/news/20101010/lakewood-ranch-how-a-town-was-born
