Hurricane Katrina has turned some of Mary Rose's neighbors into instant millionaires, but the 70-year-old retiree is still waiting for her turn to cash in on the land rush generated by the Gulf Coast's booming casino industry.
BILOXI, Miss. Hurricane Katrina has turned some of Mary Rose's neighbors into instant millionaires, but the 70-year-old retiree is still waiting for her turn to cash in on the land rush generated by the Gulf Coast's booming casino industry.
Rose lives in Point Cadet, a hurricane-battered, blue-collar neighborhood in east Biloxi where casino operators are snatching up tracts of land from property owners whose homes were flattened by the Aug. 29, 2005, hurricane.
A few weeks after Katrina, Mississippi passed a law allowing floating casino barges to move ashore and build up to 800 feet inland -- a change designed to jumpstart the region's economic recovery and protect the hotel resorts from future storms.
The move sent property values soaring for some homeowners, but the early land grab by casinos and condominium developers passed over many others who live near the water.
In March, one of Rose's neighbors across the street sold his property to a casino for more than $1 million, much more than it was worth before Katrina. Rose, however, says she hasn't fielded a single offer to buy her land. She believes her property is within 800 feet of the water line, but a map produced by the city suggests otherwise.
"Nobody said life was fair," said Rose, who lives in a government-issued trailer on a weed-choked lot where her home once stood. "Why would I waste my energies worrying about it? I'm not jealous of anyone. It's not my nature. I wish them all the best."
Across the street from Rose's property -- and across the invisible 800-foot line -- is a nearly vacant lot where Kenny Barhanovich once lived. Isle of Capri, one of the first casinos to reopen after the storm, purchased his 13,600-square-foot property for slightly more than $1 million -- a whopping $80 per square foot.
"It made life a little easier," said Barhanovich, 60, a charter boat captain. "I could retire next year if I wanted to."
It isn't getting any easier for trailer-bound homeowners like Rose to find buyers willing to pay top dollar. Industry observers say the casinos' shopping spree on the coast is in a lull as existing operators wait to see how many new competitors are entering the market.
Nine of the 12 casinos that operated on Mississippi's Gulf Coast before Katrina have reopened. In September, the reopened casinos had nearly 14,000 employees and took in $241 million, the most ever generated during that month since gambling was legalized here in 1992, according to the state.
Biloxi alone hosted nine casinos before the storm. Mayor A.J. Holloway, an outspoken advocate of gaming, has predicted that the city will host as many as 22 casinos within a decade.
"Everybody in Biloxi thinks they live on a condo site or a casino site," said Beverly Martin, executive director of the Mississippi Casino Operators Association. "A lot of people are holding out in anticipation that someone will show interest in their property."
Paul Girvan, a New Orleans-based managing director of The Innovation Group, a gaming industry consulting firm, said the pace of expansion has been tempered by high construction costs and uncertainty over how many casino operators will enter the Gulf Coast market.
"There have been so many people kicking the tires. The ones who are seriously kicking the tires are waiting until things settle a bit," he said.
Point Cadet, located on a peninsula in southeast Biloxi, has been home to generations of shrimpers and fishermen with roots in eastern Europe and, in recent decades, Vietnam. Several casinos tower over the devastated landscape now, and "the Point" has become fertile ground for commercial real estate brokers like Raymond Stronsky.
"This is the hottest real estate in town," he gushed as he drove down a nearly deserted street lined by gutted houses.
Stronsky is a broker for six different casinos. For him, Point Cadet is a virtual jigsaw puzzle in which properties stripped bare by Katrina can form the foot prints for future casino resorts.
Since the storm, Stronsky has helped casinos buy about 45 parcels in Biloxi and neighboring D'Iberville for a total of roughly $30 million. Most of that dates back to January, when Landry's Restaurants began closing on 23 parcels in Point Cadet where the company wants to build a Golden Nugget-brand casino.
"The casinos have everything they need to build," Stronsky said. "There's nothing left standing in their way."
Many homeowners who turned down offers in the early aftermath of Katrina have found interest in their property rapidly wane. Stronsky blames unrealistic expectations.
"I hate to say it, but greed has actually set in something fierce around here since Katrina," he said. "Land grabbing is over. With the prices right now, nobody can do anything."
Palace Casino general manager Keith Crosby said the east Biloxi casino only has purchased two parcels of land since Katrina, and both deals were in the works before the storm. Although he said it's hard to pinpoint how much property has changed hands, Crosby senses many would-be developers are adopting a wait-and-see attitude.
"Everybody has slowed down," he said. "It's fiscally intelligent."
That's bad news for Ronald Baker, who has been eager to sell his property ever since Katrina destroyed his uninsured home. Isle of Capri only offered him $20 per square foot, but he quickly turned it down.
"I don't want to be greedy or nothing, but I want to get what everybody else gets," Baker said. "I'm going to hold on and see what comes up."
Some Gulf Coast residents aren't as content to wait. In D'Iberville, more than 40 residents of a neighborhood hit hard by Katrina petitioned for a zoning change that would allow casinos and condo developers to build there.
Webster and Delores Lee, who have lived there since 1958, gladly signed the petition. They aren't eligible for government grants and don't want to borrow money to rebuild what Katrina destroyed, so Webster Lee says he can sell the property "with no regrets."
"I'm down and out," he said. "How much sentimental value can you have when you're broke?"
Talk of a casino possibly moving into the neighborhood isn't stopping Chip Orman, 46, from building a new home there for his wife and three children.
"Once we give this up down here, it's gone forever," he said. "If we sell to casinos or developers, this won't be a neighborhood anymore. It will be a business district."
Mary Rose is part of a group of about 20 property owners who are teaming up to try to sell their Point Cadet land. Forming a united front, they reason, will make their land more attractive to developers who may be reluctant to negotiate deals individually.
Even though Rose was born and raised here, she is eager to move on.
"I figure I'm good for 10 more years and I want to enjoy them," she said. "There are still some things I want to do with my life, and I need money to do them. But that may not be in the stars for me."
Source: Associated Press