The St. Joe Company Announces Record Setting Performance in 2023 and Growth Across All Three Segments
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Insights
The St. Joe Company's announcement of record-setting performance in 2023 is a significant indicator of robust growth in the real estate and hospitality sectors. The increase in residential sales and hotel room additions suggests an expanding market presence and an ability to capitalize on the migration and tourism trends in Northwest Florida. The reported growth in the company's residential, hospitality and commercial segments can be attributed to strategic diversification and investment in high-demand areas.
The residential segment's performance, highlighted by a record number of home and homesite sales, reflects a strong housing market in the region. The positive trend in real estate is further supported by the Metro Market Trends report, indicating a healthy demand for new homes. This could signal a favorable environment for real estate investors and a potential increase in property values.
The hospitality segment's expansion, with a significant increase in Watersound Club membership and the opening of five new hotels, is indicative of a growing tourism industry. The full year of operations for these new hotels in 2024 is expected to contribute positively to the company's revenue streams. The construction of a third golf course and additional hotel rooms scheduled to open in 2024 suggests confidence in sustained growth and may attract investment interest in the leisure and hospitality sector.
Commercially, the execution of 44 new leases and high occupancy rates demonstrate the company's strong position in the commercial real estate market. The diversification of tenants across various industries, including retail, medical and light industrial, implies a stable income source and resilience against sector-specific downturns. The development of the FSU/TMH Medical Campus with its focus on healthy aging could position St. Joe as a key player in the healthcare real estate market, potentially attracting healthcare investors and partners.
The financial implications of St. Joe's record performance are multifaceted. The all-time high in key metrics across segments suggests a robust financial position and potential for increased shareholder value. The reported occupancy rates nearing 95% are particularly impressive, indicating efficient asset utilization and strong management capabilities. This level of occupancy, coupled with the growth in membership and room inventory, is likely to result in a solid revenue base and improved margins.
The company's diversified portfolio mitigates risks and allows for multiple streams of revenue, which is reassuring for investors looking for stability in their investments. The announcement of new construction projects and future plans, such as the medical campus, shows a forward-thinking approach and potential for long-term growth. The investment in healthcare-related real estate is especially noteworthy, considering the aging population and the increasing demand for medical services.
However, it is important to consider the capital expenditures associated with the expansion of the hospitality and commercial segments. While these investments can lead to future revenue growth, they also require significant upfront costs that could impact short-term cash flows. Investors should weigh the potential benefits against the financial commitments required to sustain this growth trajectory.
The market will be closely watching the release of the fourth quarter and full-year 2023 results to gauge the financial health of the company and validate the growth narrative presented. These results will provide a clearer picture of the company's earnings performance and its ability to meet or exceed market expectations.
The St. Joe Company's strategic focus on real estate development in high-growth areas of Northwest Florida is a testament to its market acumen. The record-setting performance in residential sales aligns with broader national trends of migration to warmer climates and more affordable regions. St. Joe's success in this area suggests an effective development strategy that resonates with current consumer preferences.
The development of the FSU/TMH Medical Campus is a significant undertaking that showcases the company's ability to identify and act on emerging trends in healthcare and real estate. The emphasis on healthy aging and the integration of research, education and clinical delivery could create a new standard for medical campuses. This development is likely to attract a skilled workforce, contribute to the local economy and enhance the company's reputation as a community-focused developer.
Additionally, the expansion of Watersound Club amenities and the construction of a third golf course reflect an understanding of the luxury market's demands. These investments can create a competitive edge and potentially drive up property values within the company's residential communities. The synergy between the residential and hospitality segments can lead to a comprehensive lifestyle offering, which is attractive to both residents and visitors.
The commercial real estate achievements, marked by a record number of new leases, indicate a successful leasing strategy and an attractive mix of properties. The high occupancy rate is evidence of a strong market presence and the ability to attract a diverse tenant base, which is crucial for the sustainability of income from commercial properties.
“St. Joe continues to benefit from the growing migration and visitation to
Residential
St. Joe’s residential communities remain among the most sought-after in
Hospitality
The Company’s Watersound Club membership grew by a record number in 2023 with the full year increase of 713 members, bringing the total membership to 3,317 at year’s end. This membership growth coincided with the opening of an expansive new amenity complex adjacent to Camp Creek golf course. A third golf course is currently under construction to add to the Watersound Club amenities. In 2023, St. Joe opened five new hotels totaling 646 rooms. 2024 will be the first full year of operations for these new hotels. St. Joe, individually or through consolidated and unconsolidated joint ventures, has 11 hotels in its portfolio for a total of 1,177 rooms with an additional 121-room hotel planned to open in 2024, which will bring the total hotel portfolio to 1,298 rooms.
Commercial
St. Joe executed 44 new leases with commercial tenants, more than any other year in the Company’s history. The Company’s portfolio includes 1,028,831 square feet under lease, which represents approximately
For more information on St. Joe’s residential communities, click here.
For more information on the hotels St. Joe opened in 2023, click here.
For more information on the Watersound Club amenities, including those that opened in 2023, click here.
The Company expects to release its fourth quarter and full year 2023 results after the market close on Wednesday, February 21, 2024.
Important Notice Regarding Forward-Looking Statements
This press release contains “forward-looking statements,” within the meaning of Section 21E of the Exchange Act, including statements regarding St. Joe’s plans for a 121-room hotel, an additional Watersound Club golf course and future development of the FSU Health medical campus. These forward-looking statements are qualified in their entirety by cautionary statements and risk factors set forth in St. Joe’s filings with the SEC, including its Annual Report on Form 10-K for the year ended December 31, 2022 and subsequent current report filings as well as St. Joe’s ability to complete the planned hotel, golf course and FSU Health medical campus as anticipated.
About The St. Joe Company
The St. Joe Company is a real estate development, asset management and operating company with real estate assets and operations in
©2024 The St Joe Company. “St. Joe®”, “JOE®”, the “Taking Flight” Design®, “St. Joe (and Taking Flight Design,)®” and “Watersound Club®” are registered service marks of The St. Joe Company or its affiliates.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240201561576/en/
St. Joe Investor Relations Contact:
Marek Bakun
Chief Financial Officer
1-866-417-7132
marek.bakun@joe.com
St. Joe Media Relations Contact:
Mike Kerrigan
Vice President of Marketing and Communications
1-850-231-6426
mike.kerrigan@joe.com
Source: The St. Joe Company
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