Diamond Emerges from
Choppy Galveston Waters

Houston Business Journal, September 7, 2007,
by Jennifer Dawson

Even as a number of other proposed Galveston condominium projects are temporarily being floated out to sea, well-established Houston developer Randall Davis broke ground last month on an island resort community called Diamond Beach.
Davis is building a bevy of amenities and 120 condos in the $60 million Phase I of the beachfront project at 10327 Seawall Blvd. Half of the homes have already been sold at prices ranging from the upper $400,000s to $850,000.

Diamond Beach's construction comes at a time when some proposed condo projects on the island are experiencing lackluster sales. The Regatta and Island Grove projects, for example, have both been delayed for retooling (see "Luxury condo sales subside on isle," August 10, 2007).
But some condo experts say the properties that are having trouble getting off the ground cannot blame the Galveston sales market.

Louis Conrad of Real Venture Corp. believes some developers are having sales difficulties because they planned to build condos near big boulders instead of locating them on a beach. It's also more difficult to sell units on the West End than the East End of the island, says Conrad, co-developer of a proposed 54-unit condo project called the Tuscany. The East End project is currently converting 21 reservations into sales contracts.
Indeed, Conrad says overall residential sales in Galveston for the first seven months of 2007 are up 15 percent over the same time period last year, according to the Real Estate Center at Texas A&M University. In addition, sales of all types of Galveston residential products increased by 6.4 percent between July 2006 and July 2007. And the amount of inventory decreased by 12 percent from June to July of this year.

In the case of Diamond Beach, the eight-acre tract is located at the western edge of the seawall, so it has no neighboring properties to the west. A good portion of the property is located behind the seawall, giving it more protection against the elements, Davis says.

The condos will be organized in one long building so each will have a terrace and an ocean view. The two- and three-bedroom condominiums range in size from 1,300 square feet to 2,300 square feet. The maintenance fee has been set at $525 per month instead of on a square-foot basis.

Davis selected a distinctive pink and white facade for Diamond Beach that is reminiscent of his favorite hotel, the five-star Hotel Bel-Air in Los Angeles. The design by Houston-based Spencer Partnership Architects was also inspired by Caribbean resorts.

A first resort The seven-story property is a departure for Davis because it will be his first resort project.
Diamond Beach will include a lazy river similar to one at the Hyatt Regency Hill Country Resort and Spa in San Antonio. The pool will stretch 300 feet, which Davis says is four times the size of a normal pool. A water slide and indoor pool round out the water features.

The property will also include a private beach, but it won't be Galveston sand that touches residents' toes.
"We're going to truck in sand and create our own white sand beach," says Davis, who guesses he'll probably get the sand from Florida.
Diamond Beach will also have a day spa, fitness center, meeting/wine room, bar, teen room and an indoor kids club area.

“ It's geared to be a full resort," says Davis, who is head of Houston-based Randall Davis Co. "This is no different than if you went to Cabo or the Caymans."
All of the amenities, with a price tag of nearly $4 million, will be constructed along with the first phase of condo units. Construction is scheduled for completion by November 2008.
Once 90 percent of Phase I units are sold, Davis will begin taking deposits on 120 units in Phase II.

Diamond Beach
Location: 10327 Seawall Blvd. in Galveston
Phase I: 120 condos
Condo Sizes: 1,300 square feet to 2,300 square feet, priced from $400,000s to $850,000
Amenities: Lazy river, 300-foot pool, water slide, indoor pool, private beach with imported white sand, day spa.
Expected Completion Date: November 2008
Proposed Phase II: Another 120 condos