A choice property on Deer Island is for sale for $5 million. Is that a good price?

People are talking about the eight acres of waterfront paradise for sale on Deer Island, just a half-mile off the coast of Biloxi.

The commercial property is listed for $5 million and like all the other land on Deer Island is undeveloped and accessible only by water

The cost comes to $625,000 per acre.

“That’s a great price per acre,” said Brian Bolis, the listing agent for the land and senior vice president of NAI Sawyer, a Gulfport real estate company.

When the article about the sale was first posted on the Sun Herald website, people questioned whether that is indeed a good price for a plot of island land.

Here is a breakdown:

Beach, pirates and ghost stories

▪ It’s unique, Bolis said, since it’s the only property on an island in the Mississippi Sound known to be for sale.

▪ It’s zoned commercial. A few privately owned houses on Cat Island are rented but there aren’t any resorts on any of the barrier islands off the Coast.

▪ It’s waterfront, without a highway between the land and the water like much of the Mississippi Coast.

“That’s on the beach and there’s very little on the beach,” Bolis said. He knows of only one or two properties for sale in Biloxi or Gulfport that are directly on the beach and not north of U.S. 90.

A 20-acre site overlooking the water north of the highway is listed for $500,000 an acre.

“$500,000’s about the lowest you’ll find,” he said.

So for waterfront property on Deer Island, he said, “It’s not an out-of-line asking price.”

And it comes with ghost stories and tales of pirates Captain Kidd and Jean Lafitte and their buried treasure on the island. An article in the Sun Herald tells of a local legend about a headless skeleton of a long-dead pirate who reportedly haunts the island, and a surreal ‘firewater ball’ that floats across the shoreline.

Waterfront comes at a premium

“You pay premium for waterfront,” said Bob Davidge, who lives on the Coast and manages Waterfront Liquidators and other online real estate marketplaces.

He had some island properties featured on his website but said many have sold.

“Everyone’s paying cash,” he said, and there’s a waiting list of people who want to buy their piece of waterfront paradise.

In Bay St. Louis and Pass Christian, “They’re not even going to market,” he said. Locals are selling their waterfront properties without listing with a real estate agent

Davidge said a property owner in Bay St. Louis put out a “for sale by owner” sign, held a one-day only open house, took bids for two weeks and then sold it to the best bidder with no real estate commission involved.

On St. George Island off the Florida Panhandle, a developer bought the island at a bargain price, Davidge said He donated half of the island to the federal government to be designated as a park named for him — the Dr. Julian G. Bruce St. George Island State Park. It sits on nearly 2,000 acres at the east end of the island. The developer built St. George Plantation, a gated community with private homes and vacation properties, on the west side of the island.

“There are all kinds of ways to capitalize on these island properties,” he said.

They come with some challenges, however. FEMA flood rates are going up, Davidge said, along with insurance rates, interest rates and supply costs for those who want to build a commercial or residential development.

Even with the replenishment of Deer Island after Hurricane Katrina, the island is losing two acres a year to erosion, according to a National Oceanic and Atmospheric Administration geographical study that said the island has lost 34% of its land since 1852. Storms take another chunk of the island.

Is it worth more than Cat Island?

Deer Island is 400 acres. So this five-acre site is 2% of the total land of the island.

In 1997, three of the top candidates in the Biloxi mayor’s race opposed the development of casinos on Deer Island.

The Sanders family, which owned much of the island, valued their land at $30 million and hoped to attract up to four casinos to their parcel, according to articles in the Sun Herald.

The Coalition to Purchase Deer Island formed with a plan to get the city to dedicate casino revenue to buy the property and keep it undeveloped.

Instead the state bought all but about three private plots on Deer Island in 2002.

The total purchase price was $16.8 million, with $10 million in state bond money paid off by tidelands lease revenue, another $3.8 million in federal funds, $2 million from tidelands boundary settlements negotiated by the secretary of state’s office, and $1 million approved by the commission on Marine Resources.

“Plans are in the works to purchase the remaining tracts of land held by private owners,” according to the article published in the Sun Herald 20 years ago.

A good chunk of Cat Island also is owned by the state. This island, seven miles off the coast of Gulfport and Long Beach, is much more remote and is where pirates buried their treasures, bootleggers hid their stash during Prohibition and the government secretly trained attack dogs during World War II.

In 2011, BP bought 492 acres on Cat Island after the Deep Horizon oil spill in 2010. BP then transferred the property to the state for $13.7 million — or $27,846 per acre — with the transfer paid by the federal Mississippi Coastal Improvements Program.

The state now owns about 700 acres of the 2,000-acre island. The U.S. Park Service and private owners own the rest.

While the state may be the obvious first choice to buy the Deer Island property, it could go to a developer wanting to build a remote island vacation rentals by owner close to shore, or anyone who just wants a lot where they can fish, boat, watch the fireworks and tell ghost and pirate stories while they camp on what is said to be a haunted island.