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More Trouble in Paradise
By Les Standiford
By the beginning of 1926 it seemed that George Merrick’s concept of a tropical “City Beautiful” was one of unalloyed genius. Assessed property values neared the $100 million mark, quite a rise in value for what had begun as a $10,000, 160-acre homestead. Merrick boasted that more than $150 million had been spent in development altogether, adding that more than 100 miles of paved streets and another 125 miles of sidewalks stitched the 16 square miles of its territory. Coral Gables was now a formally incorporated city, with a mayor and commission, and $8 million in bonds had been floated to finance various city improvements. The lavish Biltmore Hotel had brought national acclaim to the new city, Tallman Hospital had opened, plus a pair of banks, eight religious congregations, two golf courses, as well as a military academy for boys, St. Joseph’s Academy for girls, and Coral Gables Elementary School and Ponce de Leon High School (enrolling ten percent of the high school aged students in Dade County). All this, where less than a decade before only pines and fruit trees dotted a sleepy landscape.
But then, just as construction had commenced for the University of Miami, the cultural capstone of the idealized settlement, the Hurricane of 1926 delivered the first body blow to Coral Gables. And, as if the devastation wreaked by that storm were not enough, another haymaker, more psychological than physical, was soon to come. There had been concern among banking interests in the Midwest and Northeast about rampant land speculation in Florida, and lobbying groups had placed a number of full-page newspaper ads warning those expecting to get rich quick by buying and selling lots and properties (sometimes lying underwater) sight unseen. While Merrick’s operations were entirely above board (he liked to point out that he had plowed every penny of profit back into the development of his beloved city) investors made leery by the bad press began to stall on promised projects; purchasers were suddenly defaulting on payments for lots; and, just as in the early 21st century real estate crisis, lenders became unwilling to extend credit to even the most worthy. As one contemporary banker has put it, “Ninety percent of economic reality lies between the ears of individuals,” and things were no different more than three-quarters of a century ago. By 1928, noted Miami historian Arva Moore Parks wrote, “for the first time in the city’s short history, more people were leaving than arriving.”
Then, with the stock market crash of 1929, the bottom fell out for Merrick. The Coral Gables Corporation, out of cash, was forced into bankruptcy. Merrick, who watched associate after associate turn on him as the economy soured, was forced from his city commission seat and had to liquidate everything he owned to pay off his debts. He would later go back into real estate — even developing a fishing resort on Matecumbe Key, itself wiped out by the Hurricane of 1935 — but his days as a mover and shaker, as well as the fairy-tale era of Coral Gables, had come to an end. Merrick, who had in 1940 been appointed postmaster of Miami by U.S. Senator Claude Pepper, died in 1942, “broke, but not broken” as nephew Donald Kuhn puts it. “Mostly, he was proud of what he had accomplished and I think most of us would understand why.”