What are John Harris and his partners doing opening a Porsche dealership in Fort Myers?
The recession devastated the area, forcing thousands of foreclosures, creating high unemployment and slashing retail sales. Who has money to afford a Porsche sports car?
Harris, a partner with West Palm Beach-based Automotive Management Services, spent $6.5 million to build the Porsche dealership near the Cracker Barrel restaurant at Daniels Parkway and Interstate 75 in Fort Myers. It opened two months ago.
Harris' reasoning for opening the dealership now is precisely linked to the 47% decline in home values that the Cape Coral-Fort Myers area has suffered in the last five years.
Here's the logic: Now that retirees and second-home buyers are purchasing homes at steep discounts in the Fort Myers area, they'll have more money left over to spend it on a Porsche. By contrast, during the boom, “what happened was all the money was going into real estate,” Harris says.
Harris isn't concerned that migration to the Gulf Coast of Florida has slowed. He points to drug-store companies such as Walgreens and CVS that continue to build new stores in preparation for what Harris says is going to be a major influx of new residents.
Harris and his partners, who also own the Naples Porsche dealership, put off their plans to build the Fort Myers store when the recession began in earnest in 2007. They bought the land in 2004.
“We started to see a pickup in September 2009” at the Naples Porsche dealership, Harris says. “All of a sudden, our numbers were very consistent.” Although he declines to cite specific figures, Harris says new-car sales in Naples rose 52% in 2010 compared with 2009.
When they rebid construction work for the Fort Myers dealership in late 2009, bids came back 30% lower than in 2007 because struggling construction companies were eager for new business. “Let's go with it now,” Harris recalls deciding.
Since they started building the Fort Myers Porsche dealership, the economy has improved, sales of existing homes have been brisk and the stock market has rebounded smartly. “We were profitable the first month of operation and that was with no advertising,” says Harris, a Brit who came to the U.S. after running casinos on cruise ships and developing a talent for selling luxury cars in Miami.
Harris isn't worried that the Fort Myers dealership will cannibalize sales from its Naples sister. That's because prospective buyers in Fort Myers used to purchase an alternate luxury brand because they don't want to drive 40 miles to Naples for service.
The demographic of the Fort Myers buyer is younger and more value-oriented. Harris acknowledges that a Naples buyer is more likely to buy a $100,000 Porsche than one that costs $40,000. But Harris makes a bold prediction about his Porsche dealerships, which sell both new and used cars: “Within five years, Fort Myers will sell more cars than Naples.”
In fact, Harris is so optimistic about the Fort Myers dealership that he's scouting for more land close to the new dealership. “We're looking to double our business,” Harris says.