Investing In Land: A History Lesson – Florida Swampland
“If you believe that I have some swampland in Florida to sell you.” Today that is a punchline to a joke but in the 1960s there were so many people infused with excitement by that very possibility that Leonard Rosen had to build his own fleet of 15 airplanes just to shuttle prospective buyers to his Golden Gate Estates in South Florida.
When brothers Leonard and Jack Rosen, businessmen from Baltimore, made their first visit to Cape Coral in 1957, they found about a dozen homesteaders across a vast stretch of treeless land being used to graze cattle and grow vegetables. The Rosens began acquiring land for less than $100 an acre until they had 175 square miles and announced intentions to build the largest residential development ever planned in America. They constructed 880 miles of limestone roads and dug hundreds of miles of canals as the property was carved into 1.25-acre building lots with plans to erect a city of 500,000 people.
Glossy brochures and full-color advertisements in every major Sunday newspaper in America advertised the lots at Golden Gate Estates as “the first step to financial security.” Prospects were lured to the development with free trips and free steak dinners to listen to a sales pitch. Phone calls to out-of-staters dreaming of the good life in Florida sold 29,000 lots alone. Leonard Rosen told reporters that he made over $100 million in the 1960s; his real estate company was the fourth largest publicly traded company in Florida.
None of those sales pitches to visiting would-be-buyers was ever delivered during the summer rainy season. At those times the only way to reach most of the lots was by boat. States began passing legislation that forbade sales tactics like those employed by the Rosens at Golden Gate Estates. “Selling swampland in Florida” became notorious as the scam to outdo all other scams, not challenged until the Nigerian princes of the Internet age.
Philosopher George Santayana once opined, “Those who do not learn from history are doomed to repeat it.” Florida swampland is still being marketed to far-away buyers, often through Internet auctions. That is not to assert that all Florida swampland is worthless or none of it is worth buying. Some ten percent of Golden Gate Estates did get developed before bankruptcy and it still exists today with large lots and rural living. (Most of the rest of the property lives on as public parkland). And the Walt Disney Corporation purchased plenty of swampland and developed it into some of the most valuable real estate in Florida. Just check out the property thoroughly before you buy, that’s all.