Real Estate News

Frustration growing over Hilton Head’s ‘lockout’ units

Xanadu Villas on Hilton Head Island on Jan. 20, 2016.
Xanadu Villas on Hilton Head Island on Jan. 20, 2016. jkarr@islandpacket.com

Some Hilton Head Island residents are increasingly frustrated that the town has yet to decide whether controversial “lockout” units should be allowed in condominium complexes.

“Regardless of which side you are on, the town needs to tackle this with an authoritative answer,” said Jack Daly, president of the Forest Beach Owners Association, where the units have become a hotly debated issue.

Monday, both proponents and opponents packed the town’s Public Safety Committee meeting to demand a decision on the practice of dividing one rental unit into two or more by locking or caulking a door shut. The subdivided units are common in Oceanwalk Villas near South Forest Beach Drive where many owners turned their condos’ mother-in-law suites and second and third bedrooms into separate units years ago to collect more rent. The practice has also been reported at neighboring Xanadu Villas.

But instead of a decision, the committee recommended that town staff work with the residents of Oceanwalk Villas in Coligny to find a solution and review the town’s land management ordinance regarding lockouts.

The decision followed a closed-door session where the committee received a recommendation from a law firm. Robinson, McFadden & Moore, of Columbia, was hired by the town in recent months to provide legal advice on the issue.

Town residents who opposed lockout units have said the practice creates a safety risk because renters are unable to access electrical boxes. They also have claimed the units are rented at a low price, attracting criminals to the complexes.

“The (Oceanwalk) units have 40-year old breakers in them,” Daly said. “It is clearly a safety issue.”

Daly also claims there is a correlation between crime and the subdivided units. He said people are able to rent the units without paying for utility bills, making it difficult for them to be tracked. He said this attracts criminals such as prostitutes and drug dealers.

Those in favor of the subdivided units say town staff has already said the practice is not a safety risk. They also claim screening practices, used by the condominium complexes to vet potential residents, are to blame for crime, not the units.

Bob Hopkins has been renting out a three-bedroom unit as three separate rentals since 2002. He said the units rent for between $670 to $990 per month.

“I have never had a criminal in my unit since I have been screening them,” Hopkins said.

Background screening and credit checks is one way owners of the unit can weed out criminals, Hopkins said.

Hopkins, like Daly, is frustrated by the time it is taking the town to reach a verdict.

“I can’t believe the town has spent more than $11,000 (on lawyers) and still is no further along than they were,” Hopkins said. “We are not resolving this problem.”

Some claim the town is breaking national fire code by now banning the units. But town officials disagree, saying they have a different interpretation of the code. Town attorney Brian Hulbert said that since a power box is in each unit, despite subdivision, it is legal.

Town Fire Marshal Joheida Fister also is to blame for a delay in the process, say opponents of the units. They believe Fister was given authority to make a determination by the state fire marshal via an April letter but has failed to do so.

Fister and Hulbert have said the letter does not give Fister the ability to make a decision regarding the electrical concerns with the lockouts. They said the building department has control over any electrical issues.

Hulbert said the building department determined the lockouts did not break town codes after a review last year. The decision was appealed to the town’s Construction Board of Adjustments and Appeals, which also ruled the units were allowed.

Town Council will make the final decision on whether to bounce the issue to town staff during a meeting either next week or at its August meeting.

This story was originally published July 11, 2016 at 3:17 PM with the headline "Frustration growing over Hilton Head’s ‘lockout’ units."

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