This one was a cute idea, and I like the idea of the creature living in the sandcastles. If I'd heard this as a kid, I would've ached to go to the beach so I could build an awesome home for a little guy, and that fact made me smile.
As others have said, the intro got pretty long. It was interesting in the way that a textbook can be interesting, but I can't say that it was much of a hook.
In the end, I didn't end up finishing the story, because after the intro, everything else just seemed to be showing what had already been told in the intro. It didn't really matter to me what happened to the little guy, I knew he was going to die when the sandcastle got washed away, and beyond that there wasn't anything I was really waiting for.