Condominium conversions bring change to Wildwoods

Wildwood Crest attempts to stem loss of motels
Monday, August 14, 2006
By WILLIAM H. SOKOLIC
Courier-Post Staff

NORTH WILDWOOD
The Surf Song resembles a typical beach-block motel.

It has four stories, 90 rooms and two pools.

The only difference? It's a former motel gone condominium.

Upscale suites loaded with all of the comforts of home can be yours for anywhere from $199,000 to $550,000.

The motel-to-condominium conversion phenomenon has washed over most Jersey Shore towns, but it's a tidal wave in the Wildwoods. No matter that a downturn in the real estate market in the last year has resulted in a glut of unsold condos on the island.

"We've been watching it happen. We've had front-row seats," said Jack Morey, executive vice president of Morey's Piers and a founder of the Doo Wop Preservation League.

The league trumpets preservation efforts of the Wildwoods' collection of kitschy motels from the 1950s and 1960s, known for a style architects have labeled Doo Wop.

Of 145 motels on a list compiled for the Doo Wop Preservation League, 50 have disappeared in the last few years. Many were in Wildwood Crest, which has the largest concentration, said league chairman Dan MacElrevey.

"It's market pressure," he said. "The land values along the Jersey Shore have exploded."

In a number of cases, the motels are demolished, much to the chagrin of preservationists who hoped the buildings would do for tourism in the Wildwoods what Victoriana did for Cape May.

In other cases -- the Surf Song, for example -- the basic building remains the same and only the format changes. Conversions, rather than demolitions, offer hope that the architecture stays alive.

Mary and David Benson of Mount Laurel bought a one-bedroom condo at the Surf Song, in part because it retained its motel look.

"We bought it as an investment to rent out, but also knowing we won't have to rent a place for the summer ourselves anymore. It's a perfect size for us. We'll utilize it a lot," said Mary Benson, a CPA who has vacationed in the Wildwoods much of her life.

Buying these kinds of condos in the Wildwoods is an inexpensive way to go from renter to owner/investor for folks who find Stone Harbor, Sea Isle City and Brigantine too pricey, said Brian McDowell, a broker with Shamrock Real Estate in North Wildwood.

McDowell helped sell conversions of the European and the Mediterranean motels in North Wildwood. Both sold out, and some units already have been resold.

"I was able to get the buyers into a place where they use it and also rent for the other weeks to pay some of the mortgage and taxes," he said.

Officials with M.W. Mitchell Inc., an Audubon company that developed the Surf Song and other motels in the Wildwoods, see the condo trend as a boon to the local tourism industry.

"As much as you're looking at losing motels, you gain redeveloped real estate in the process," said Dan Decker, a vice president with the firm. "We bring these buildings up to current code and make affordable shore homes available to people."

It's not just cheap housing fueling the condo boom.

The Wildwoods have witnessed an upward trajectory after years as a downtrodden resort.

"I've lived here all my life and you couldn't give away properties 10 years ago," said Len Lauriello, an electrical inspector for the Joint Construction Office of the Wildwoods, which approves building plans on the island.

Upscale restaurants have moved in throughout the island.

The Wildwoods Convention Center now books concerts from classic rock to the Bacon Brothers.

Despite the changes, developers found motel owners all too willing to get out of the business for a price.

"You offer them $10 million. And they ask themselves, "Do I want to keep working every summer,' " said Michael W. Mitchell, a Haddonfield resident and president of the development company that bears his name.

For many owners, the money raked in over a 12-week season isn't enough to offset the amount of work and regulations.

Insurance rates have skyrocketed since 9/11, Comcast has raised its cable rates and water bills have risen.

Motels often set rates in November for the following season, and profits are gobbled up by these increases, said Bruce Smith, owner of the Tangiers Resort Motel in Wildwood Crest and president of the Greater Wildwood Hotel & Motel Association.

The truth is, the value of the land is much higher than what motel owners can expect to bring in, said Bruce Esher of Fasy Real Estate in North Wildwood.

"Before a lot of these motels were demolished or condo'd out, they weren't doing that well," he said.

Jerry Clark agreed to convert the Central Motor Inn in North Wildwood to condos. At age 65, she no longer wanted the aggravation of running a motel.

"My children help me, but it's not fair to them," she said.

Smith and others hope efforts under way on a number of fronts will fend off further motel losses.

"As motel owners, we want to know what do we need to do to save them and compete in tomorrow's market," Smith said. "It's up to the municipalities to pass whatever ordinances are required to move that along."

Reach William H. Sokolic at (609) 823-9159 or wsokolic@courierpostonline.com