The great storm of 1962 will be remembered in tremendous detail next Wednesday at a dinner at the Roland E. Powell Convention Center. I am looking forward to attending the event and watching the 40-minute video that will feature storm footage as well as personal accounts and reflections from local residents.
Many lives were affected by that deadly storm, including that of our founder, Dick Lohmeyer, who passed away seven years ago.
Back then, as difficult as it may be to believe for many, Lohmeyer owned a 10-unit motel called the Coronado, having bought two oceanfront lots around 1956 for $13,000. The storm destroyed the motel, leaving Lohmeyer with only “the clothes on my back”, as he recalled in an interview in 2004.
What ensued after the storm was a legal battle with the insurance company over whether the ocean or the wind destroyed the motel during the storm. Many businesses at that time had similar fights to wage after the storm. Thanks partly to witnesses who recounted the motel’s roof lying atop a neighboring property, he won the case and was awarded full value of the motel. He used that insurance money to build what is now Pier 7 on 7th Street and Edgewater Avenue. Those bayfront units are some of the most unique in the entire resort. I should know. I lived there for a few years.
“The storm of ’62 was the best thing that ever happened to me. That gave me the means to do other things,” Lohmeyer recalled in that 2004 interview.
Those “other things” included starting his own newspaper called the Maryland Coast Press, which eventually through some interesting twists and turns led to this Maryland Coast Dispatch you are reading today.
I like Warren Buffett. In his annual letter to shareholders of Berkshire Hathaway Inc., Buffett, widely acknowledged as an investment genius, acknowledged a misstep when he predicted the real estate recovery would occur in 2011.
Here’s a couple excerpts I found most interesting from his letter, which I enjoy reading each year. Much of what he says applies to our local market here.
“Last year, I told you that ‘a housing recovery will probably begin within a year or so.’ I was dead wrong. … Housing will come back – you can be sure of that. Over time, the number of housing units necessarily matches the number of households (after allowing for a normal level of vacancies). For a period of years prior to 2008, however, America added more housing units than households. Inevitably, we ended up with far too many units and the bubble popped with a violence that shook the entire economy. That created still another problem for housing: Early in a recession, household formations slow, and in 2009 the decrease was dramatic.
“That devastating supply/demand equation is now reversed: Every day we are creating more households than housing units. People may postpone hitching up during uncertain times, but eventually hormones take over. And while ‘doubling-up’ may be the initial reaction of some during a recession, living with in-laws can quickly lose its allure.
“… Wise monetary and fiscal policies play an important role in tempering recessions, but these tools don’t create households nor eliminate excess housing units. Fortunately, demographics and our market system will restore the needed balance – probably before long. When that day comes, we will again build one million or more residential units annually. I believe pundits will be surprised at how far unemployment drops once that happens. They will then reawake to what has been true since 1776: America’s best days lie ahead.”