Oceanfront property: Man buys offshore lighthouse to use for research

When the government auction of a 46-year-old offshore lighthouse closed on the Friday before Labor Day, Dave Schneider assumed he'd been outbid.

"I was waiting all day for a call to come in and it never did. So, I said, 'Well, that stinks. I guess I didn't win.' And then I just sort of went on about my business," the 56-year-old Richfield man said.

Schneider traveled to Mora a couple of days later for a cookout with relatives. As he chatted with his cousin, Rich Stace of St. Michael, he mentioned his brief brush with lighthouse ownership. Stace was skeptical. A lighthouse?

"Just Google it," Schneider told him.

Stace typed "Diamond Shoals light station" into his cellphone's web browser and his jaw dropped when he found a news article that indicated Schneider's company, Zap Water Technology Inc., had won the auction. Now it was Schneider's turn to be skeptical.

"I said, 'Oh, come on. Don't give me that,'" Schneider remembered. "Rich is kind of a kidder."

But he wasn't kidding this time. Schneider contacted the Government Services Administration -- the federal agency responsible for selling off surplus government real estate -- the following week and worked out the details of the transaction. He ended up paying $20,000 for the small steel island.

Schneider got his first look at the property, which sits 13 miles off Cape Hatteras, N.C., on Nov. 28. He and a friend spent about five hours examining the structure to get a sense of its condition.

"Obviously needs a lot of work," Schneider said. "But the vistas were incredible."

The lighthouse sits in about 50 feet of water in the Diamond Shoals. The shoals are part of an area known as the Graveyard of the Atlantic -- a reputation it earned for being the site of hundreds of shipwrecks.

The Diamond Shoals Light was one of six "Texas towers" -- so called because they are essentially modified offshore oil drilling platforms -- installed along the East Coast by the U.S. Coast Guard in the 1960s.

The tower in the Diamond Shoals fell into disrepair after it was deactivated in 2001.

A report commissioned by the Coast Guard about three years ago estimated the structure would require about $2.3 million worth of renovations. Schneider is hoping to spend about a fifth of that.

"The place is in, actually, great shape," he said. "We've got a lot of steel out there to replace. But that's just the nature of it."

Schneider thinks the steel will be his biggest expense in refitting the dilapidated tower. He trimmed $1 million off the Coast Guard's estimate by installing a 75-foot handmade rope ladder in place of a mechanical boat lift, and he hopes to save on labor costs by employing volunteers.

Once the renovation is complete, he plans to turn the lighthouse into a research station for Zap, which manufactures eco-friendly cleaning solutions from salt water.

Although the tower's 5,000-square-foot living space can accommodate only a handful of occupants, he plans to make the facility available for other companies as well.

Schneider has calculated that the average wind speed at Diamond Shoals is about 11 mph, suggesting that it might make a good spot for wind energy research, among other green technologies, he says.

He isn't the first to have this idea. The U.S. Department of Energy received custody of a Texas tower in the Chesapeake Bay from the GSA in September and plans to use it for research into wind energy technology, too.

Even if none of his plans work out, though, Schneider is pretty happy with his purchase.

"Let's just say -- the very worst-case scenario -- I don't do anything with it," he said. "I have a 75-foot by 75-foot campground out in the middle of the ocean."

But some of his friends and family members don't share his enthusiasm. They aren't convinced that a defunct lighthouse in the Atlantic Ocean is a good investment, Schneider says.

Stace isn't worried. He says if anyone can make a go of this peculiar fixer-upper, it's Schneider.

"He's one of those guys, he'll do things by the seat of his pants and it always works out for him," Stace said. "I mean, I think it's cool. Where else can you buy oceanfront property for $20,000?"

Nick Woltman is a Twin Cities freelance writer.