Ginn Buys 4,538 Acres for Nearly $63M

LA BELLE, FL-In one of his biggest land purchases to date, Orlando resort developer Bobby Ginn has closed a four-year-long deal to purchase 4,538 agriculture-zoned acres from Alico-Agri Ltd. of La Belle for $62.9 million or $13,861 per acre (32 cents per sf).

A Ginn subsidiary, Ginn LA Naples Ltd LLP, bought the land from the subsidiary of publicly traded Alico Inc., one of the largest landowners in Central and Southwest Florida. The property is adjacent to the Florida Gulf Coast University.

Ginn plans to develop 334 estate-size waterfront lots on the land, area brokers familiar with the developer’s tentative plans tell GlobeSt.com. Under terms of the contract, Ginn paid $6.3 million cash or 10% of the total purchase price. Alico-Agri holds the first mortgage which calls for Ginn to pay the balance of the purchase price in four equal installments, along with accrued interest.

John R. Alexander, chairman and CEO of Alico Inc., says the sale proceeds were placed in escrow “to allow for the possibility of a 1031 like-kind exchange, should the company elect that option.” Alexander says the deal took four years to complete “due to the complexity of the permitting process.” Atlanta-based Morris Manning & Martin law firm represented Ginn Co.

“If Alico-Agri chooses to receive cash, the gain [net of income taxes of $21 million] over the next two years from this contract would be $33.4 million or $4.53 per share, consisting of approximately $3.3 million or 45 cents per share to be recognized in the fourth quarter of fiscal year 2005, and $30.1 million or $4.08 per share recognized in the fourth quarter of fiscal 2006, upon receipt of the first mortgage principal payment,” Alexander says in a prepared statement.

“If Alico-Agri exercises its option under the like-kind exchange rules, no gain would be recognized for book or tax purposes for the portion of the property exchange,” Alexander says. “Alico is diligently exploring the best course of action to create long term value for all of its shareholders.”

Alico Inc. owns 141,000 acres in Collier, Hendry, Lee and Polk counties. The company is involved in citrus fruit production, cattle ranching, sugar cane growing, sod production and forestry. Alico also leases land for farming, cattle grazing, recreation and oil exploration, and is becoming more active in real estate development not associated with its holdings, according to Alexander.