- Distressed commercial real estate should be converted to green space and parks, Hilton Head Island representatives told U.S. officials last month.
The resort island joins a list of larger cities -- including Atlanta, Cleveland, Denver, Detroit, Houston, Los Angeles, Miami, Philadelphia, Phoenix and Wilmington, Del. -- preparing reports for a national program that seeks to convert troubled property to new uses. In theory, the new "green fields" would lead to redevelopment of surrounding areas.
Hilton Head's report is expected to be completed mid-July.
"People were surprised that Hilton Head has also been impacted by the economy, as there is a perception that our resort island is immune from the economic downturn," senior town planner Jayme Lopko said. "Our economy ebbs and flows as a result of the economies in larger urban destinations. The more they struggle, the fewer people who choose to visit, retire or buy a second home here."
Lopko and University of South Carolina Beaufort hospitality professor John Salazar presented research and plans to redevelop parts of the island to city, parks and federal officials gathered June 16 in Washington, D.C., for a "Red Fields to Green Fields" conference.
The study seeks to discover what would happen if overbuilt or vacant commercial property -- land worth less than its outstanding loans -- is converted to green space.For Hilton Head, the program could result in a nearly $300 million investment to redevelop aging commercial centers, including the Coligny Beach area and The Mall at Shelter Cove. Preliminary plans for Coligny call for creating a quarter-mile-long park surrounded by shops, cafes, restaurants, apartments and condos.
"Coastal towns throughout the country have been hit hard during this economic crisis," said Kevin Caravati, program manager from the Georgia Tech Research Institute. "Hilton Head Island provides a snapshot of what is occurring and how infrastructure investments can help revitalize these critical economies."
Salazar said research shows Hilton Head maintains a steady population growth, but properties continue to decline in value, diminishing quality of life and visitor numbers.
"Our visitor numbers are on the rebound but declined over the last couple years. Unemployment has increased, and spending patterns have declined," he said. "That trickles through the economy and results in lost retail and hotel spending."Tourism on the island has fluctuated between 2.3 million and 2.2 million visitors a year from 2005 to 2010. Gross taxable sales fell $191.4 million from fiscal years 2008 to 2010, according to town data.
Salazar and Lopko say the Red Fields to Green Fields program would remove bad loans from banks' books to avoid failures; create jobs in park design, construction and maintenance; and increase the value of businesses and homes near finished parks.The research could also help support pending federal legislation encouraging public-private partnerships through U.S.-backed, low-interest loans to finance the purchase of distressed real estate, according to a USCB news release.
The zero-interest loans would be made from a $200 billion fund for land that is "banked" for future development and parkland acquisition. The money would be provided by the nation's banks, led by the Federal Reserve, U.S. Treasury and the FDIC, according to one proposal. "Banked" land would later be sold to repay the loans.
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