On May 5, 2003, about 1100 central daylight time, an Enstrom 280C, N51752, registered to Aeroquest Inc., and operated by Paradise Helicopters Inc., as a Title 14 CFR Part 91 sightseeing flight, crashed into the water at Panama City Beach, Florida. Visual meteorological conditions prevailed, and no flight plan was filed. The commercial-rated pilot and two passengers were not injured, and the helicopter incurred substantial damage. The flight was originating at the time of the accident. The pilot stated that he was taking off over the water from an approved helipad on the beach where he was providing the public with sight seeing rides. He said that the wind was generally from the west, but was at times variable, with a speed of about 5 or 10 knots. He said he took off over the water, and as he did so his rotor rpm started to decrease, so he lowered the collective and pitched the nose down to increase his rotor rpm, and was starting to recover, but he ran out of altutude and impacted the water. He said that prior to the accident there was no mechanical failure or malfunction of the helicopter or any of its systems.