It’s impossible to ignore the mountain of money growing around Lake Martin and a Russell Lands official believes Alexander City should be finding ways to gulp and not merely sip its waters.
“Our fortunes are tied to Alexander City in a large way,” Russell Lands vice president of real estate sales Steve Arnberg said Thursday during the annual State of the Lake program at Central Alabama Community College. “Most of our buyers are coming from Atlanta and Birmingham and they have to come through Alexander City to come to us. There are 350 miles of undeveloped shoreline on Lake Martin and that’s a lot of opportunity for development for Alexander City.”
But embracing tourism instead of the traditional manufacturing base started by Russell Corp. has been a struggle.
Why do some people in Alexander City shun the lake and its shimmering economic tentacles?
“I really don’t know how to answer that question,” Arnberg said after his presentation. “What is more interesting to me is when you have this tremendous economic engine and this wonderful success operating in your backyard, why not take advantage of it? It’s a conundrum to me. I think most Alexander City folks tend to be somewhat pessimistic on the local economy and business opportunities. I’m sitting here looking at this economy we have on the lake and I don’t know if they see that as part of the Alexander City economy.”
Arnberg pointed out there are 1,883 finished rooftops in Russell Lands neighborhoods and cabins within the Alexander City zip code and statistics indicate a desire for more. There has been steady growth in sales volume, units sold and sales prices year-over-year from 2013 to 2019.
The only significant decline is the current active listings.
“Current active listings are down and that means the supply is down which means the average price will go up,” Arnberg said. “The average time on the market for Lake Martin is 180 days and it’s currently 161. This tells me it’s a good time to add new lots. An investment made in Lake Martin is pretty secure.”
The lake impact area is valued at $4.7 billion, according to a 2018 economic impact study done by Robert Charles Lesser & Co. (RCLCO) real estate advisors.
“I think that’s undervalued,” Russell Lands chief financial officer David Sturdivant said.
Of that total,Tallapoosa County accounts for $2.88 billion, the RCLCO study showed, and waterfront property represents 80% of its value and half of the county’s overall value.
Yet the study also showed $149 million annually from that area is spent away from Tallapoosa County and Alexander City.
“We know there is a lot of leakage,” Sturdivant said. “There is a lot of money people are spending outside the area.”
In the 12 months ending May 31, Arnberg said there were $176.146 million in total residential sales on Russell Lands properties coming from 302 transactions for an average price of $583,264.
“I look at that as 302 people invested $583,000 each on a second house,” he said. “That’s good news that many people want to come to Lake Martin.”
But the economic impact of each house is much higher.
“You’ve got permit revenue and property tax revenue,” Arnberg said. “There are 40 trades included in construction and most of those trades are brought in from outside because we don’t have enough of them here. There are 30 suppliers. There are banks, insurance, utilities, road builders, architects, engineers and real estate agents; contractors who buy gas, food and tools; new owners who buy boats, furniture, skis, food and gas. Alexander City should take advantage of that.”
Arnberg said Lake Martin and Alexander City should be enjoying a happy marriage.
“I am thrilled there are business opportunities out there our community can benefit from,” he said. “If people are coming from all over the country investing that kind of money here, our image is better than we think it is. They are not coming to me saying they are buying on Lake Martin because they don’t like Alexander City, they are buying because they like Lake Martin and Alexander City is an asset. They should be two ends on the same barbell.”
That will require altered thinking.
“If we don’t have enough builders, plumbers, electricians and carpenters here, what are we going to do about that?” Arnberg asked. “Are we going to train that workforce? I would encourage our local folks to ask, ‘How can I benefit from that business? It’s there and I need to capture some of it.’ I’d be saying, ‘OK, how can I get involved?’ So why doesn’t somebody get into home décor and home building? Our community needs to see the business that is there and shape itself to that business opportunity.”
Arnberg said Russell Marine’s new superstore on U.S. Highway 280 in Alexander City is an example.
“We are building that new boating center,” he said. “All those people are driving down Highway 280 and we want it to serve people coming to the lake and be a part of the Alexander City economy. If I told you we’d be building a $36 million facility on 280, everybody would be excited and that is basically what is happening year in and year out in today’s economy on Lake Martin and nobody talks about it.”
Arnberg said a conservative estimate of the economic impact of 72 waterfront lot sales in the last year is $36 million based on an average home cost of $500,000.
Notable developments on Lake Martin include The Ridge, The Willows, Willow Glynn, White Oak Landing, Kennebec, Talisi Cove, Longleaf and Miners Cove.
Lake Martin has 880 miles of shoreline and 6,413 unique property owners counting Alabama Power and Russell Lands once each, Arnberg said. There are 7.29 property owners per square mile.