The St. Joe Company (JOE): Business Model Canvas [10-2024 Updated]

Discover how The St. Joe Company (JOE) has carved a niche in the competitive real estate and hospitality markets of Florida with its innovative Business Model Canvas. From strategic partnerships with developers to a diverse array of customer segments, this framework reveals the core elements that drive JOE's success. Explore the key activities, resources, and value propositions that set the company apart, and see how it effectively balances its cost structure with lucrative revenue streams. Dive deeper to understand the mechanics behind this thriving business model!

The St. Joe Company (JOE) - Business Model: Key Partnerships

Joint ventures with homebuilders and developers

The St. Joe Company has established significant joint ventures with various homebuilders and developers to enhance its residential offerings. One notable venture is the Latitude Margaritaville Watersound JV, which focuses on developing a 55+ active adult residential community in Bay County, Florida. As of September 30, 2024, this JV had 426 homes under contract and completed 1,533 home sale transactions out of an estimated 3,500 homes planned. The Company's investment in this JV was valued at $58.2 million, reflecting contributions of land and cash.

Partnerships for land development and asset management

St. Joe actively engages in partnerships aimed at land development and asset management. The company has a joint venture with Watersound Management, LLC, which is responsible for leasing and managing multi-family housing developments. As of September 30, 2024, the company held a 50% interest in this JV. The Watersound Management JV is pivotal in managing properties owned by the Company, thus enhancing operational efficiency.

Collaborations with local governments for community projects

Collaboration with local governments is a strategic aspect of St. Joe's approach to community development. The company works closely with municipal authorities to plan and implement community projects, which may include infrastructure improvements and community amenities. This collaboration not only helps in securing necessary approvals but also fosters a positive relationship with the community. For instance, the company has recorded a liability for Community Development District (CDD) debt associated with its properties, amounting to $10.1 million as of September 30, 2024. This debt is financed through assessments on properties benefiting from the improvements, showcasing a partnership model that aligns the interests of the company with local community needs.

Joint Venture	Investment Value (in millions)	Homes Under Contract	Total Homes Planned	Completed Transactions
Latitude Margaritaville Watersound JV	$58.2	426	3,500	1,533
Watersound Management JV	50% Interest	N/A	N/A	N/A
Community Development District Debt	$10.1	N/A	N/A	N/A

The St. Joe Company (JOE) - Business Model: Key Activities

Real estate development and asset management

The St. Joe Company engages in extensive real estate development activities, focusing on residential and commercial properties. As of September 30, 2024, the company reported residential real estate revenue of $81.5 million during the nine months ended, a decrease of 35.8% from $126.9 million in the same period in 2023. The gross profit for this segment was $39.1 million, reflecting a gross margin of 48.0%.

During the nine months ended September 30, 2024, St. Joe sold 581 homesites, down from 881 homesites sold in the same period in 2023. The average base revenue per homesite sold was approximately $115,000.

In the commercial real estate segment, the company recorded sales of approximately 268 acres for $9.4 million, resulting in a gross profit of $5.8 million and a gross margin of 61.7%.

Period	Residential Revenue ($ million)	Gross Profit ($ million)	Gross Margin (%)	Homesites Sold	Average Revenue per Homesite ($)
9 months ended 09/30/2024	81.5	39.1	48.0	581	115,000
9 months ended 09/30/2023	126.9	62.3	49.1	881	105,000

Hospitality management and operations

The St. Joe Company has expanded its hospitality management operations significantly, contributing to its revenue growth. For the nine months ended September 30, 2024, hospitality revenue increased by 34.2% to $157.0 million, up from $117.0 million in the same period in 2023. The gross profit for hospitality operations was $52.3 million, leading to a gross margin of 33.3%.

This growth is attributed to the successful opening of several new properties, including the Embassy Suites by Hilton Panama City Beach Resort and Home2 Suites by Hilton Santa Rosa Beach, among others. The Watersound Club saw an increase in membership, reaching 3,532 members as of September 30, 2024.

Period	Hospitality Revenue ($ million)	Gross Profit ($ million)	Gross Margin (%)	Membership Growth
9 months ended 09/30/2024	157.0	52.3	33.3	444
9 months ended 09/30/2023	117.0	24.6	21.0	N/A

Sales of residential and commercial properties

Sales of residential and commercial properties represent a critical activity for The St. Joe Company. In the residential segment, the company reported a total of $28.0 million in revenue during the third quarter of 2024, a decrease of 31.5% from $40.9 million in the same quarter of 2023. For the nine months ended September 30, 2024, total residential real estate revenue was $96.7 million, down from $148.3 million in 2023.

In the commercial property sector, St. Joe's sales totaled approximately $7.3 million during the three months ended September 30, 2024. The gross profit for commercial and forestry real estate sales was $4.1 million, with a gross margin of 56.2%.

Period	Residential Revenue ($ million)	Commercial Revenue ($ million)	Total Revenue ($ million)	Gross Profit ($ million)
Q3 2024	28.0	7.3	35.3	10.1
Q3 2023	40.9	3.1	44.0	16.3

The St. Joe Company (JOE) - Business Model: Key Resources

Large portfolio of residential and commercial land in Florida

The St. Joe Company holds a significant portfolio of land assets in Florida, with approximately 87% of its real estate located in Bay, Gulf, and Walton counties. As of September 30, 2024, the company reported an investment in real estate, net amounting to $1,039,391,000 . This includes 22,203 total homesites in various stages of planning or development . The residential segment generates revenue from the sale of homesites, with 1,381 residential homesites under contract, anticipated to yield approximately $122.3 million in revenue.

Category	Value
Total Homesites	22,203
Investment in Real Estate (Net)	$1,039,391,000
Homesites Under Contract	1,381
Expected Revenue from Homesites	$122,300,000

Strong brand recognition in real estate and hospitality

The St. Joe Company has established a robust brand presence in the real estate and hospitality sectors. Hospitality revenue increased by 16.9% in Q3 2024 to $55.4 million, compared to $47.4 million in Q3 2023. For the first nine months of 2024, hospitality revenue reached $157.0 million, marking a 34.2% increase from $117.0 million in the same period of the previous year. The hospitality gross margin also improved, rising to 34.1% in Q3 2024 from 23.8% in Q3 2023.

Metric	Q3 2024	Q3 2023	9M 2024	9M 2023
Hospitality Revenue	$55,460,000	$47,369,000	$157,037,000	$116,967,000
Hospitality Gross Margin	34.1%	23.8%	33.3%	21.0%

Financial resources including loans and equity from joint ventures

The St. Joe Company utilizes a variety of financial resources, including loans and equity from joint ventures, to support its operations and growth. As of September 30, 2024, the company reported cash and cash equivalents of $82.7 million, a slight decrease from $86.1 million at the end of 2023. The company also has various loans outstanding totaling $448.5 million, with a weighted average effective interest rate of 5.1%. Notably, the company received $15.4 million in cash distributions from its joint ventures during the nine months ended September 30, 2024.

Financial Metric	Value
Cash and Cash Equivalents	$82,700,000
Total Loans Outstanding	$448,500,000
Weighted Average Effective Interest Rate	5.1%
Cash Distributions from Joint Ventures (9M 2024)	$15,400,000

The St. Joe Company (JOE) - Business Model: Value Propositions

High-quality residential communities with diverse price points

The St. Joe Company focuses on developing residential communities that cater to a range of buyers. As of September 30, 2024, the company had over 22,000 homesites in various stages of planning or development. Currently, there are 1,381 residential homesites under contract, expected to generate revenue of approximately $122.3 million. The residential segment contributes significantly to the company's revenue, with 19.2% of consolidated operating revenue in Q3 2024.

Segment	Q3 2024 Revenue Contribution	Q3 2023 Revenue Contribution	Homesites Under Contract	Projected Revenue from Homesites
Residential	19.2%	35.0%	1,381	$122.3 million

Unique hospitality experiences in scenic locations

The St. Joe Company offers unique hospitality experiences through its various properties, including hotels, private clubs, and recreational facilities. In Q3 2024, hospitality revenue increased by 16.9% to $55.4 million from $47.4 million in Q3 2023. The growth was primarily driven by increased membership dues and ancillary spending, alongside the opening of new amenities and hotels, such as the Embassy Suites by Hilton Panama City Beach Resort and Home2 Suites by Hilton Santa Rosa Beach, which both opened in 2023.

Hospitality Revenue	Q3 2024	Q3 2023	Growth Rate
Total Revenue	$55.4 million	$47.4 million	16.9%

Sustainable development practices in real estate projects

The St. Joe Company emphasizes sustainable development in its real estate projects. This commitment is evident in its planning and execution of residential and commercial developments, ensuring minimal environmental impact while maximizing community benefits. The company’s investment strategy focuses on projects that meet long-term risk-adjusted return criteria, which includes considering environmental, social, and governance (ESG) factors. This approach not only aligns with market trends favoring sustainability but also attracts a growing segment of environmentally conscious buyers. The company’s revenue from leasing activities also reflects this sustainable approach, with leasing revenue up 19.1% in Q3 2024, totaling $15.6 million compared to $13.1 million in Q3 2023.

Leasing Revenue	Q3 2024	Q3 2023	Growth Rate
Total Revenue	$15.6 million	$13.1 million	19.1%

The St. Joe Company (JOE) - Business Model: Customer Relationships

Personalized customer service for homebuyers

The St. Joe Company focuses on providing personalized customer service to homebuyers, enhancing their experience throughout the purchasing process. As of September 30, 2024, the company had approximately 1,381 residential homesites under contract, expecting to generate revenue of about $122.3 million from these sales. The average base revenue per homesite sold was approximately $115,000 during this period. This reflects the company's commitment to understanding and meeting the specific needs of its customers, which is critical in the competitive real estate market.

Membership programs in hospitality offerings

In the hospitality sector, The St. Joe Company operates the Watersound Club, which had 3,532 members as of September 30, 2024, an increase of 444 members from the previous year. The hospitality revenue for the nine months ended September 30, 2024, was $157.0 million, a 34.2% increase from $117.0 million in the same period of 2023. Membership dues and ancillary spending have significantly contributed to this growth, showcasing how effective membership programs can enhance customer loyalty and engagement.

Active community engagement and feedback mechanisms

The St. Joe Company actively engages with the community and seeks feedback to improve its offerings. This engagement is reflected in the overall growth of its residential and hospitality segments, demonstrating a strong demand driven by community input and preferences. The company operates in an environment characterized by limited housing supply relative to demand, which has been aided by positive feedback from existing customers regarding the quality of life and amenities in Northwest Florida.

Metric	Q3 2023	Q3 2024	% Change
Residential Homesites Under Contract	1,575	1,381	-12.3%
Expected Revenue from Homesites	$135.5 million	$122.3 million	-9.7%
Watersound Club Membership	3,088	3,532	14.4%
Hospitality Revenue	$117.0 million	$157.0 million	34.2%

The St. Joe Company (JOE) - Business Model: Channels

Direct sales through real estate agents and online platforms

The St. Joe Company utilizes a network of real estate agents to facilitate direct sales of residential properties and homesites. For the nine months ended September 30, 2024, the company reported residential real estate revenue of $81.5 million, a decrease of $45.4 million or 35.8% compared to $126.9 million in the same period of 2023. During this period, the company sold 581 homesites, down from 881 homesites sold in the prior year. The average base revenue per homesite sold was approximately $115,000, compared to $105,000 in the previous year.

Marketing through hospitality websites and social media

The St. Joe Company has increased its marketing efforts through various hospitality websites and social media platforms. Hospitality revenue for the third quarter of 2024 reached $55.4 million, up 16.9% from $47.4 million in the same quarter of 2023. The company attributes this growth to enhanced online visibility and marketing strategies, which have also contributed to an increase in membership dues and ancillary spending. The gross margin for hospitality increased to 34.1% for the third quarter of 2024 compared to 23.8% in the same period of 2023.

Community events and open houses for property showcases

The St. Joe Company organizes community events and open houses to showcase properties and engage potential buyers. As of September 30, 2024, the company had 1,381 residential homesites under contract, projected to generate approximately $122.3 million in revenue. This strategic approach has fostered community engagement and allowed potential buyers to experience the properties first-hand, thereby enhancing the sales process.

Category	Revenue (2024)	Revenue (2023)	Change (%)	Homesites Sold (2024)	Homesites Sold (2023)
Residential Real Estate	$81.5 million	$126.9 million	-35.8%	581	881
Hospitality Revenue	$55.4 million	$47.4 million	+16.9%	N/A	N/A
Projected Revenue from Homesites	$122.3 million	N/A	N/A	1,381	1,575

The St. Joe Company (JOE) - Business Model: Customer Segments

Homebuyers looking for residential properties in Florida

The St. Joe Company primarily serves homebuyers interested in residential properties in Northwest Florida. As of September 30, 2024, the company had approximately 1,381 residential homesites under contract, expected to generate revenue of around $122.3 million upon closing. The average base revenue per homesite, excluding residuals, was approximately $115,000 for the nine months ended September 30, 2024. The demand for homesites has been positively impacted by population migration to the region, attributed to its high quality of life and natural amenities.

Metric	Value
Homesites under contract	1,381
Expected revenue from homesites	$122.3 million
Average revenue per homesite	$115,000
Homesites sold (2024)	581
Residential real estate revenue (Q3 2024)	$19.0 million
Residential real estate gross profit (Q3 2024)	$7.5 million

Tourists and travelers seeking hospitality services

The hospitality segment of The St. Joe Company caters to tourists and travelers through various offerings, including hotels, vacation rentals, and recreational amenities. For the three months ended September 30, 2024, hospitality revenue increased by 16.9% to $55.4 million, compared to $47.4 million in the same period of 2023. This growth reflects the company's strategic focus on enhancing its hospitality services and leveraging the region's attractiveness to visitors. The gross margin for the hospitality segment improved to 34.1% in Q3 2024 from 23.8% in Q3 2023, indicating better operational efficiency and profitability.

Metric	Value
Hospitality revenue (Q3 2024)	$55.4 million
Hospitality revenue growth (YoY)	16.9%
Hospitality gross margin (Q3 2024)	34.1%
Hospitality revenue (9 months ended September 30, 2024)	$157.0 million
Hospitality gross margin (9 months ended September 30, 2024)	33.3%

Investors interested in commercial real estate opportunities

The St. Joe Company also targets investors looking for commercial real estate opportunities. As of September 30, 2024, the company reported total commercial and forestry real estate revenue of $9.4 million for the nine months ended September 30, 2024. During the same period, the gross profit from commercial and forestry real estate sales was approximately $5.8 million, with a gross margin of 61.7%. The company sold approximately 268 acres of commercial and forestry real estate during this time. The stable performance in this segment indicates ongoing investor interest and confidence in the company’s commercial offerings.

Metric	Value
Commercial real estate revenue (9 months ended September 30, 2024)	$9.4 million
Commercial real estate gross profit (9 months ended September 30, 2024)	$5.8 million
Commercial real estate gross margin (9 months ended September 30, 2024)	61.7%
Acreage sold (9 months ended September 30, 2024)	268 acres
Acreage sold (Q3 2024)	25 acres

The St. Joe Company (JOE) - Business Model: Cost Structure

Development and construction costs for real estate projects

During the nine months ended September 30, 2024, The St. Joe Company reported total residential real estate revenue of $81.5 million, with a gross profit of $39.1 million, resulting in a gross margin of 48.0%. The average base revenue per homesite sold was approximately $115,000. The company sold 581 homesites during this period, compared to 881 homesites in the same period of 2023.

Operational expenses for hospitality management

The hospitality segment generated revenue of $157.0 million during the nine months ended September 30, 2024, with a gross profit of $52.3 million, equating to a gross margin of 33.3%. Operational expenses for hospitality management included costs related to the management of hotels, clubs, and other facilities, contributing to an overall increase in revenue of 23.9% compared to the same period in 2023.

Operational Expense Category	2024 (in millions)	2023 (in millions)
Employee costs	$9.8	$7.8
Property taxes and insurance	$4.1	$4.6
Professional fees	$2.4	$2.8
Marketing and owner association costs	$0.7	$0.7
Occupancy, repairs, and maintenance	$0.5	$0.3
Other miscellaneous	$1.4	$1.2
Total Corporate and Other Operating Expenses	$18.9	$17.4

Marketing and sales expenses to attract customers

Marketing and sales expenses have been crucial in attracting customers to both the residential and hospitality segments. For the nine months ended September 30, 2024, the company reported a significant increase in hospitality revenue, driven by enhanced marketing efforts and the opening of new facilities. Marketing expenses were included in the overall operational costs, which totaled $18.9 million.

The estimated marketing expenses for the hospitality segment were approximately $0.7 million in both 2024 and 2023. These costs are essential for maintaining competitiveness in the real estate and hospitality markets, particularly in regions with growing demand for residential and leisure properties.

The St. Joe Company (JOE) - Business Model: Revenue Streams

Sales of homesites and residential properties

During the nine months ended September 30, 2024, residential real estate revenue decreased by $45.4 million, or 35.8%, to $81.5 million compared to $126.9 million for the same period in 2023. The company sold 581 homesites during this period, down from 881 homesites sold in the previous year. The average revenue per homesite sold was approximately $115,000, up from $105,000 in the same period of 2023. Revenue included estimated homesite residuals of $2.6 million in 2024, significantly down from $20.0 million in 2023. The gross margin for residential real estate was 48.0% for the nine months ended September 30, 2024, compared to 49.1% for the same period in 2023.

Period	Homesites Sold	Residential Revenue ($ millions)	Average Revenue per Homesite ($)	Gross Margin (%)
9 Months Ended September 30, 2024	581	81.5	115,000	48.0
9 Months Ended September 30, 2023	881	126.9	105,000	49.1

Hospitality revenue from lodging and memberships

Hospitality revenue for the nine months ended September 30, 2024, reached $157.0 million, representing a 34.2% increase from $117.0 million in the same period in 2023. The gross profit from hospitality operations was $52.3 million, with a gross margin of 33.3%, compared to a gross margin of 21.0% in 2023. The increase in hospitality revenue was driven by membership dues, ancillary spending, and new lodging options. As of September 30, 2024, the Watersound Club had 3,532 members, up from 3,088 members the previous year.

Period	Hospitality Revenue ($ millions)	Gross Profit ($ millions)	Gross Margin (%)	Membership Count
9 Months Ended September 30, 2024	157.0	52.3	33.3	3,532
9 Months Ended September 30, 2023	117.0	24.6	21.0	3,088

Leasing income from commercial properties and facilities

Leasing revenue for the nine months ended September 30, 2024, increased by 20.2% to $44.7 million from $37.2 million in the same period of 2023. The gross profit for leasing operations was not specified, but the percentage of leased space was 96% as of September 30, 2024, with 1,179,000 square feet available for lease. The increase in leasing revenue reflects improved occupancy rates and demand for commercial spaces.

Period	Leasing Revenue ($ millions)	Leasable Square Feet	Percentage Leased (%)
9 Months Ended September 30, 2024	44.7	1,179,000	96
9 Months Ended September 30, 2023	37.2	1,079,000	95

Article updated on 8 Nov 2024

Resources:

1. The St. Joe Company (JOE) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of The St. Joe Company (JOE)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View The St. Joe Company (JOE)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.