Hi-Tide on Cat Cay

Abstract

Tom was worried--he was being pressured to sign another extension with his realtor. He just learned the sale of his house had fallen through: the buyer was unable to arrange the necessary financing. Granted his house was not your typical suburban house; instead it was a multi-million dollar luxury property located on a private island in the Caribbean. He thought his house had sold two years ago when he accepted the buyer's offer. With several business deals beckoning for both his attention and capital, Tom needed to sell his house.... the sooner the better! Tom's realtor was anxious to sign another contract and "get busy" selling "Hi-Tide," the name of Tom's estate. Also, other realtors were approaching Tom about a chance to list the property for him. As Tom considered his options to sell "Hi-Tide" located on Cat Cay, he knew within a couple of days he would have to decide if he wanted to continue listing his property with his current realtor, engage another realtor, or possibly even sell via auction. A cay, pronounced "key," was a small, low island consisting mostly of coral or sand. The word "cay" was used almost exclusively in the Caribbean. A cay was similar in structure to the small islands composing the Florida Keys. Cat Cay was a private island, owned by the members of the Cat Cay Yacht Club. The cay was said to once be the stronghold of notorious pirates like Harry Morgan, the Pirate King and Blackbeard. Like many of the isles in the Bahamas, it played a significant role in the American War of Independence, serving as an important base for confederate blockade runners. More recently, it was known as a place for the rich and famous. Many pioneers of deep-sea fishing vacationed there, and much of its early popularity was attributed to the annual migration of blue-fin tuna in the surrounding ocean waters. Tom's estate was one of 67 luxury properties on Cat Cay. In order to own a home on Cat Cay, a prospective buyer was required to first become a member of the Cat Cay Yacht Club. Potential owners had to be sponsored by a current member of the club, seconded by another member and, after the candidate was vetted, the Board of Directors voted whether to accept or reject the proposed member. Members were required to submit a non-refundable initiation fee of $25,000 (which was part of an equity buy-in of approximately $250,000), along with prepaid annual dues of $12,900. The Board of Directors would consider prospective members during their regularly scheduled meetings which were held six to seven times each year. Non-members were allowed to visit Cat Cay, but were restricted to the marina area, which included a dockside bar, a restaurant/lounge, a commissary, a boutique, and a medical clinic. The rest of the cay included a pool and several beaches, tennis courts and a golf course, and these were available for members and their registered guests only. The island could be accessed by boat or by air. Cay Air Charters provided air transportation to Cat Cay and the surrounding area since 1996. This air carrier offered both scheduled flights and private charters to the cay. All flights departed from Fort Lauderdale. In addition, private planes could land on the cay. Hi-Tide Tom's home, Hi-Tide, was advertised as "one of the largest estates on this tropical jewel of an island." The property commanded breathtaking waterfront views of pristine beachfront. The property was further advertised as "a spacious, recently renovated five-bedroom villa, a separate two bedroom, two bath bungalow, and a caretaker's cottage, all on three divisible, and potentially very lucrative oceanfront lots." Finally, the main home was described as "designed for fun, with a large kitchen and adjoining dining area, great room with large fireplace and wet bar and huge, open terraces. Also on the main level are two guest suites both with en suite baths....the master bedroom suite comprises the entire second level and features a large private terrace, while the top level offers a third, incredibly bright guest suite with a private observation balcony. …