BEHIND THE GATEHOUSE, ISLAND THRIVES IN CASINO'S WAKE
Miami Herald - Sunday, July 25, 1993
by GEOFFREY TOMB, Herald Staff Writer

Created from muck and sand, with Roaring '20s fame for its craps-shooting, illegal-whiskey pouring casino and resident mobster, Palm Island today is a three-street community surrounded by sea water, guarded by a gatekeeper, entered only by bridge or boat.

"Full-time security," responds Lisa MacIsaac of Wimbish Realty when asked to describe the island's No. 1 selling point. She cites prices of "less expensive homes in the low to mid- $500,000 range."

Bargains are available, however. A motivated seller has knocked $150,000 off the asking price for Casa Contenta at 10 Palm Ave., an eight-bedroom, eight-bath walled manse built in 1924. Snap it up for $3.75 million, reduced from $3.9 million.

Despite its facade of exclusivity, Palm Island is a democratic place where you may not be able to afford to live but have free use of its streets and million-dollar park.

"The streets are open for the public whether security guards are there or not. People can just drive on. They can't stop you," said Marshall Kanner, president of the 300-member Palm-Hibiscus-Star Island Association, which supplies the round- the-clock gatekeeper.

In fact, whether for roundball or roulette, the public has been coming and going from Palm Island since day one.

That was in 1919 when bay-bottom sand was sucked up and deposited there to form it, halfway between Miami and Miami Beach, a bridge length north of what is now MacArthur Causeway.

Building lots sold out before the job was finished and quickly the island enjoyed its banner year: 1922.

Ed Ballard, co-owner of the French Lick Casino, opened the Palm Island Club, a snoots-only casino where prohibited alcohol flowed freely and admittance was for tourists only. Logic was the cops would look the other way if only out-of-towners got fleeced. Both did.

Big Bill Dwyer, a New York bootlegger and race track owner (Miami's Tropical Park) took over the club next. One show offered bandleader Earl Carroll's Vanities Revue, featuring, according to a Miami Herald reporter, a naked showgirl in a huge glass of champagne.

But the cops began refusing to look the other way. Refurbished, renamed, it opened as the Latin Quarter in 1939, run by New York producer Lou Walters , father of ABC's Barbara Walters. Gambling was gone.

By the 1950s, tourists no longer wore tuxedos, television changed nightlife and the Latin Quarter was in decline. Gutted by fire in 1959, the club's shell stood as a ghost of Miami's flamboyant past.

Neighbors complained until Metro condemned the site in 1968.

The island's most famous resident was Chicago mob boss Al Capone, who in 1922 bought 93 Palm Ave. for $40,000. Seller was Clarence Busch, of the St. Louis beer barons, whose family also owned 94 Palm Ave. across the street.

With a 100-foot dock on the water, Capone spent $200,000 to create a winter command post with a gate-guest house, boat house, main house and coral rock grotto.

Capone left the property for eight years, sent to prison for income tax evasion in 1931. He returned in 1939, a broken, diseased wreck. He died there in 1947.

The home is still splendid, hidden behind a tan and white wall and gatehouse, lined with royal palms and a flaming royal poinciana.

The old Busch estate at 94 Palm Ave. is empty, now being redone. In 1979, guru Maharaj Ji, "God on Earth" to four million followers of the Divine Light Mission, lived there, paying $8,800 a month rent for the eight-bedroom home.

Corporate raider Victor Posner lives down the street at 39 Palm Ave., a six-bedroom, five-bath home where weeds have overgrown the tennis court.

Under attack by the Securities Exchange Commission, Posner has fallen on hard times. But Palm Island's fortunes have never been higher.

Newest resident is Univision talk show hostess Cristina Saralegui, who moved into 64 Palm Ave. in January. The eight- bedroom estate, built in 1932, is assessed at $1.59 million.

"If you are a celebrity, you feel very comfortable there," said Marcos Avila, Cristina's husband.