Just over 100 years ago, in March 1924, Florida was earning a national reputation as a haven for con artists. The Florida real estate boom of the 1920s was underway and a culture of legitimate ambition was becoming laced with greed. The real estate business was unregulated and banking was only lightly supervised by the state.
Land use zoning and building codes were virtually nonexistent, so speculators were free to believe what they most wanted to hear — that overnight fortunes were already being made by those with the foresight and courage to get on the Florida bandwagon. Indeed, some believers who arrived at the party early and left in time did become quite wealthy.
Hired in the early 1920s to promote Florida’s growth, the famous orator William Jennings Bryan remarked at the height of the boom that Miami was “the only city in the world where you can tell a lie at breakfast that will come true by evening.” Real estate hustlers took him literally, promising outsized profits to anyone who would pay for a piece of Florida — even if they had to borrow the money to buy it.
For a time, their promises paid off. Fueling the boom were thousands of speculators drawn to Florida by newly built railroads and highways, making the state’s warm year-round climate suddenly accessible to winter-weary northerners.
The combination of balmy weather and easy profits were irresistible to many, and the South Florida communities of Coral Gables, Miami Beach, Boca Raton and Palm Beach exploded with investment, borrowing and building.
What goes up must come down, though — or at least level off. A series of powerful hurricanes dented Florida’s image as a refuge from bad weather. Tales of broke, victimized land buyers, exploited by real estate brokers who went from unscrupulous to desperate, spread across the country.
The supply of fresh, gullible buyers evaporated. Unregulated Florida banks that had made generous loans to over-leveraged developers failed, suddenly and spectacularly. Uninsured depositors and stockholders lost everything.
In Jacksonville, the boom attracted attention and local speculation. By 1926, when the bubble started to collapse, some local developments such as Venetia were caught up in the unfolding crash. However, Jacksonville was less affected by either the boom or the crash of the mid-1920s. Three factors help explain what made this city different from South Florida.
The first had to do with industry. Unlike the so-called Gold Coast communities further to the south, Jacksonville had a significant industrial base that had survived to recover from its 1901 Great Fire and later prospered during World War I. Working people could earn a living to sustain their families with steady jobs in shipyards, pulp and timber mills or with the railroad.
Maritime terminals required workers to manually load and unload ships, while a mature urban economy existed to serve the consumer needs of a steadily growing population.
In North Florida, the ways that people became accustomed to using land was also different from the rest of the state. Profiting from real estate had rarely been quick and easy — it took time, work and patience to extract wealth from land through raising timber, cattle, citrus or other crops.
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The notion that land could be effortlessly flipped for a quick profit was foreign to Jacksonvillians. It’s true that newcomers saw great possibilities in the area, and projects such as Venetia and San Jose were among the results. Those new developments were designed and executed with some degree of care and forethought. Streets and utilities were in place for prospective homeowners.
Finally, Jacksonville’s banking industry was different from that of Florida’s newer cities, such as Miami or Tampa. Here borrowers dealt with institutions such as the Atlantic National Bank, Florida National Bank and Barnett Bank. Experienced lenders favored borrowers with durable relationships and made loans at more conservative ratios.
Even so, the statewide rash of bank failures took a toll in Jacksonville, opening the door for a major investment in the Florida National by wealthy industrialist and financier Alfred I. duPont. With the help of his brother-in-law Ed Ball, duPont turned Florida’s economic crash of the mid-1920s into a statewide wealth-building vehicle headquartered in Jacksonville.
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Through the decades that followed, Jacksonville remained Florida’s center for industry, banking and insurance. Other Florida cities such as Tampa were left reeling in the aftermath of the crash, and within a few years were defaulting on their municipal bonds. City workers were paid in scrip, and Tampa entered the Great Depression far sooner than the rest of the United States.
For all its struggles and complications, Jacksonville weathered Florida’s great boom and crash of the 1920s, modeling a kind of metropolitan stability that other civic leaders envied. It would dominate the state, politically and economically, until well into the Cold War years.
Alan J. Bliss, Ph.D., CEO, Jacksonville History Center
This guest column is the opinion of the author and does not necessarily represent the views of the Times-Union. We welcome a diversity of opinions.
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