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38-room Gilbert's Resort in Key Largo, Florida Listed for Sale for $16 Million

By David Goodhue, The Reporter, Tavernier, Fla.McClatchy-Tribune Regional News

April 29, 2011--EDITOR'S NOTE: An earlier version of this story appeared in the print version of The Reporter on April 29, before Gilbert's owner Reinhard Schaupp could be reached. His comments are included in this updated article.

Gilbert's, the iconic resort situated where U.S. 1 meets Key Largo, is on the market.

As motorists drive over the new Jewfish Creek Bridge, they'll see a For Sale sign perched on a large crane sitting in the bayside resort's parking lot.

Staff at the resort say business has been booming, but they were told Gilbert's was for sale last Tuesday, April 19. Reinhard Schaupp, who owns the resort with his wife, Karina Schaupp, said there are several reasons why they put Gilbert's on the market. Chief among them: the permitting process in Monroe County.

"If you want to change something, it takes way too long, and time is money," Reinhard Schaupp said.

The four-acre waterfront restaurant, bar and motel is a popular party spot and stopover for sailors, but the Schaupps, who have owned the property since the mid-1990s, had grander plans. They bought Gilbert's in 1997 for $2.6 million and then essentially sold it to themselves in 2006 for $5.9 million when they changed their company from a corporation to a limited liability company, Schaupp said.

The Schaupps's asking price for Gilbert's is $16 million. Reinhard Schaupp said business is better than ever, so if a buyer's not found, he and his wife won't have any concerns about staying on. But they wanted to see what kinds of offers they get.

Another reason they are looking to eventually sell is because their children, who are 27, 24 and 21-year-old, don't want to carry on the business when their parents retire, Schaupp said.

"They only work on weekends, and in the long-run, don't want to run the business," he said.

Back in 2008, the couple planned to transform Gilbert's 4-acre site on Jewfish Creek into Karina Bay Resort & Marina. They envisioned an upscale, "fractional ownership" resort where unit owners would have access to a fleet of aircraft and 10 boats during their stays. They would also have concierge service that would supply whatever else they needed, including a stocked fridge and a car in the driveway.

But those plans got swallowed up by the recession and real estate crash, according to Schaupp. "We started with our own money. We couldn't get a loan for the rest. That's why stopped everything," he said.

According to March 2008 article in The Reporter, Reinhard Schaupp said of the planned new development, "It's going to be like a five-star hotel."

The existing 38-room motel was going to be replaced with 16, 2.5-bath duplexes and three standalone villas. The restaurant and tiki bar were going to be rebuilt and remain open to the public, as was much of the marina.

The Schaupp's originally wanted to market the project as a condominium-hotel, but abandoned the idea as the real estate bust that swallowed similar projects became more apparent.

Instead, they opted for the "fractional ownership" model. In those properties, buyers purchase a share of a specific unit. In Karina Bay's case, owners would have a one-tenth share. Buyers would be purchasing a period of time, with shares in five-week increments.

The Schaupp's goal at the time, according to press reports, was to have 190 or more total owners buying in at between $267,000 and $325,000. They were also going to sell boat slips for about $275,000. I n the 2008 article, Reinhard Schaupp said he wanted to see 20 percent presales before construction on Karina Bay began. That apparently didn't happen. Now, all that remains of the proposed project is a sign directing people to a sales office that isn't there.

Karina Bay joins a list of other anticipated high-end projects that fell victim to the economy and some developers' vision of what they thought Keys visitors and residents wanted for the future of the island chain.

But Reinhard Schaupp said even though the business is for sale, he and Karina are moving forward with renovating the existing rooms and tiki bar, and adding some luxury rooms by the beach area.

"We're still moving forward with Gilbert's. We have not given up. If it sells, good for us. If not, it's also good for us," he said.


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Copyright (c) 2011, The Reporter, Tavernier, Fla.

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