Florida Weekly

SYD KITSON
The man behind the new Babcock Ranch
BY ROGER WILLIAMS

rwilliams@florida-weekly.com

November 29, 2007

http://www.floridaweekly.com/news/2007/1129/real_estate/078.html

Syd Kitson is a man who owns 17,000 acres of fun, surrounded by two great circles of obligation at Babcock Ranch, the fatted calf of a public-private enterprise lying along the Lee-Charlotte County border.

One circle is geographic - nearly 74,000 acres of wilderness and wetland owned for the last 18 months by the public. Kitson has promised to help maintain this land, along with the state, as a natural Florida place surrounding his planned development.

And the other circle is both political and economic. It consists of the twin ropes of the U.S. and Florida economies on the one hand, and of state and county bureaucracies responsible for managing transportation, water and wildlife, and protecting taxpayers, on the other.

Those agencies issue permits, which Kitson is obligated to acquire in order to move forward with his plan: to build 19,500 homes with supporting businesses and pleasures, and to bring 50,000 people to cowboy country, before he gets old.

In the middle of all that stands the man himself.

At 6-foot-4 and 49 years of age, Kitson still displays considerable lean-and-mean, although he's down in weight about 50 pounds from his 252-pound playing days as a Green Bay Packer. In 1980 he was drafted as a guard out of Wake Forest University, which his daughter now attends, then spent five years with the Pack before a final halfseason with the Dallas Cowboys.

Each morning, he runs either four miles or he lifts weights before going to work. He said his wife understands his commitment to what may become the signature work of his life, so she doesn't mind not getting to spend a lot of time in his company.

Kitson is now king of the hill of his fabulously conceived, but not yet executed Babcock Ranch development. It's an "ecopolitan" community (the word appears in press releases) whose still-conceptual utopia is designed to become a brick-and-mortar, environmentally sanguine reality by the year 2030, on 17,000 acres of the old ranch.

It's an odd time to talk optimistically about building and selling houses, especially 19,500 of them, not one of which has yet to rise a foot off the ground. But that's what Kitson does these days, sounding like the Wizard of Oz, gone green.

"Coming out of the swamp, we think people are going to be looking for green, sustainable communities," he said, speaking with his trademark enthusiasm, even at 10 p.m. on a weeknight.

"We believe the demand is going to be there - the baby-boomers are coming. There are 1,000 people a day moving to Florida now, even in this economy. So it's a supply issue, and we're bullish on Florida.

"As we're going through the approval process, the market is down. When we come up and start offering homes, about 2010 or 2011, the market will have recovered. I'd hate to be coming out of the ground selling homes two years ago, or last year, but this is a natural process of cycles that weeds out those who shouldn't be in the business."

Kitson himself got into the business of Babcock by what many consider his elegant deal-making. He brought many vested interests together, to create a deal that ultimately let the state and Lee County purchase 80 percent of Babcock (that's the 74,000 acres), and he and his partners purchase the rest (that's the 17,000 acres). They closed on the deal about 16 months ago , and it included $41.5 million that Lee County taxpayers (through Conservation 20/20) put on the table for 5,000 of the nearly 9,900 acres that lie inside Lee's borders.

He also agreed to be a conscientious steward not only of his own lands, but also of the state and county public lands, in league with the state.

Whether he can live up to that obligation remains to be seen.

"Ten years from now, if we have the same amount of wildlife and habitat on that (74,000) acres that we do now, are we successful?" asked Wayne Daltry, director of Smart Growth in Lee County.

"The group says 'Yes,' but Wayne says, 'No.' The baseline was 91,000 acres. We're not fools. They're going to develop, and development means you lose environmental value there. Agreements on the sale of the property include the ability of Mr. Kitson to do mitigation in (74,000) acres.

"So the unavoidable downturn in the environmental value of the 91,000 acres can be made up by reinvesting in the (74,000). But if that happens, then success cannot be measured as breaking even."

Bill Hammond, a renowned environmentalist and professor emeritus of Marine and Ecological Sciences at Florida Gulf Coast University, agrees with Daltry. But he adds that the state has already dropped the ball on its end of the deal, by offering no money or management for such crucial projects as control of exotic species on the new public lands - something the Babcock family long did on its own.

Hired by Kitson to help manage the environment across the entire enterprise, Hammond said the lack of money from the state is already threatening a precarious environment injured further by drought.

"Just in recent months, since hunting has stopped on the ranch, the deer population has increased, but it's much less healthy, so you'll see a decline ultimately in deer," Hammond said.

"That's one of the first indicators we got of a management problem. Yes, the wildlife quality will increase as the habitat gets sustained, but will the state do its share? Now there's not enough money to control exotics. The state budget got cut significantly and there are no dollars at all appropriated. Since income is tight right now, that leaves serious questions about the future."

In addition, Hammond said there are wildlife problems caused by a combination of severe drought and 80 years of sound ranching management aimed at drying out pastures for cows. The Babcocks, like other ranchers, altered natural water flows which Kitson, Hammond and their sizeable team now aim to restore.

"Sunfish and those kind of critters are not doing well - amphibians, crayfish - they have very low populations on the ranch, compared to the way we expect them to be," Hammond said. "It's a sign we have far too short a hydro-period.

"Ultimately, the development lakes will create a big lift in bald eagles, and wading birds and fish, and prey species will get through."

Watching all this and carefully collecting data, are people such as FGCU professors Win Everham and Jerry Jackson, along with Hammond.

"The Jacksons, for example, are committed to doing bird populations out there three or four times a year," said Hammond.

"We want to document what's there before development breaks ground, and then what happens afterwards."

And whether or not Kitson holds up his end of the deal, or the state does its share, won't be evident for a long time.

"Phase one of this development won't even be finished 10 years from now," Hammond said. "About 15 or 20 years from now, the proof of the pudding will come home."

The old Babcock will be no more

Before Kitson's arrival, the ranch remained a 91,000-acre, 143-square-mile behemoth consisting of farm fields, mines, and vast tracts of cow pastures, along with woods and wetlands. It was home to black bears, white-tailed deer, Osceola turkeys, countless quail, panthers, and the rest of the fauna treasures native to that countryside. The Babcocks had opened it in recent years to so-called eco-tourists who paid for short buggy rides back into the swamp.

Now "Babcock Ranch," although still operating in a strange limbo as a cow-andcrop concern with eco-tourism (the crops will end next year), is really only a dream, painted in the most vivid and appealing terms by Kitson: 19,500 houses and almost 50,000 residents living in and beside trails, wild places and preserved habitat, all by the time Kitson is 72 years of age. The community will come festooned with countless shops, several hotels, three 18-hole golf courses, town parks, at least five Charlotte County public schools and an FGCU satellite campus.

And don't forget the astounding half-amillion square feet of medical offices that still amount to only about 18 percent of the planned retail space.

All of it will be surrounded by some of the most pristine and lovely wild places left in subtropical North America, he said.

But how's it all going to be paid for, especially the costs of start-up?

Two revenue sources exist, Kitson said. One is the state of Washington retirement fund (with Morgan Stanley), which is a 50-percent partner with Kitson & Partners, the West Palm Beach firm Kitson has used as the offensive line in his assault on the Babcock dream.

The second and equally important money source is the elaborate deal approved by former Gov. Jeb Bush that creates a special taxing district - a bond situation that will pay for infrastructure, said Kitson, including the many roads and highways that have to support the traveling ambitions of all the people who will inhabit Babcock Ranch.

That could create huge problems in Lee County, some fear.

The southern boundary of the Babcock Ranch lies only about four miles from I-75 and about eight miles from downtown Fort Myers, and therein lies one of the major hurdles Kitson faces - which he has not yet dealt with, Daltry said

Especially from the viewpoint of Lee County officials, county taxpayers could be in danger of holding the bag for infrastructure and road improvements here, because vast numbers of people may start driving to I-75 or to Fort Myers from Babcock - before Kitson's village is built out, and before residents there have enough stores, churches, schools, restaurants and employers to keep them mostly in Babcock, as Kitson plans.

In Kitson's vision, that won't happen, ultimately, because Babcock will contain everything people who live there need and want.

But Daltry and others fear for the fate of Lee County wallets, in the short term.

"The real monitoring for traffic counts on (Lee) roads is not traffic counts off-site of Babcock, it's building permits on-site," Daltry said.

"Here's why. For planning purposes, every 1,000 homes produces 10,000 trips, which in transportation lingo are called attractions and productions. Hypothetically, a house produces a work trip in the morning, and it attracts it back in the evening, creating the production end and the attraction end."

So in Kitson's case, Daltry said, what happens in Lee County depends on what Kitson develops, and when. If he develops a lot of homes at Babcock to raise revenue early, without the sufficient attractions of stores, churches, restaurants, employers and the like, Lee County could suffer.

"If you're talking about 5, 7, 10, 12 or 15 years before he gets the balance right, then that's congestion for those years on our roads.

All the adverse transportation impacts forecast in Lee come about because trips forecast to be produced in Babcock, are not attracted to end in Babcock. So huge columns of traffic will be heading south, and many fewer heading north.

"Since gas taxes, impact fees and whatever we squeeze off of property tax are not generated in Lee County for Babcock Ranch projects, in a standard world, we would not get help from those sources, to pay for transportation."

That's not the case for Charlotte County taxpayers, who will rely on the special taxing district to make users pay for most of the costs of infrastructure.

Meanwhile, Kitson has been spending a significant amount of time with people who are not CEOs, a fact that impresses Daltry and others, they said. Such as the cowboys who still work Babcock Ranch.

"What was striking to me about them was how similar we are," Kitson said, describing what it was like to get to know them. "They had the same passion for the land that we did. These guys are a different breed. Their code of ethics is pure. When they say they're going to do something, they do it. Yes, they're wearing jeans and boots, and I have a shirt and tie, but we both care about the land."

And they both try to do what they say they're going to do, even in Daltry's estimation.

Asked if Kitson was any different from the many other developers he's seen and met over the years here, his reply was instantaneous: "No different from the ones who meant what they said."