260 apartments or timeshares? Hilton Head developers get first approval, and a warning

A plan to build 260 apartments at the Hilton Head Christian Academy campus is heading back to Hilton Head Island Town Council — with several changes to stop the buildings from eventually becoming timeshares.

The request for rezoning was approved by the planning commission Wednesday morning with recommendations to limit the possibility of the site becoming for-sale condos that would anger nearby residents and threaten the “brand” of an island attempting to address a workforce housing shortage.

This time around, New York-based Spandrel Development Partners applied for rezoning to build 260 apartments with a maximum height of 45 feet. That’s down from the request to build 300 units at 55 feet tall the commission first heard in February.

Spandrel developers also updated the rezoning request to move the apartment buildings toward the center of the lot, which pleased some neighbors at Old Woodlands Plantation in terms of visibility of the buildings and noise.

“I’m in favor of this,” resident Sandra Entrup said.

“These gentlemen have bent over backwards to accommodate (us),” she later added.

Representatives from Spandrel Development Partners and Hilton Head Christian Academy speak with residents of Old Woodlands on Thursday, May 2. The open house-style meeting was to discuss Spandrel’s impending application for rezoning of the campus to build apartments. Katherine Kokal The Island Packet

Others were still skeptical about the developer’s plans.

“I wholeheartedly disagree that this is going to be good for the island,” Old Woodlands resident Brian Kuhens said. “This is one little project. It would not ruin my life, but it’s the little bits (that are going to affect us). It’s putting a little more pavement here, and a little more rooftop there...”

The commission — which discussed the request and took public comment for two hours Wednesday — ultimately voted to add three recommendations for the town council to hear:

Extend the minimum rental period

Planning commission members voted to ask Spandrel developers to make the shortest possible lease for the apartments six months to avoid Airbnb-like rentals that would increase visitor traffic to the site.

Require workforce housing units for 20 years

After initial push back from the commission and town council about a lack of workforce-oriented units, the developers said said five percent — or around 13 units — will be reserved for “below-market” or workforce housing rentals.

A below-market unit, Neuman explained, would be around $850 for a studio or $1,100 for a two-bedroom apartment. Fair market value, where the other units will be priced, is around $1,200 for a studio or $2,600 to $2,800 for a two-bedroom unit, he said.

Committee members said that should be required for 20 years instead of the previously proposed 10-year term.

“Is there any opportunity to push that five percent number?” commission member Lavon Stevens asked. “This going to set some precedent ... as (developers) come to the island they’re going to be looking at this model.”

Neuman said it’s unlikely the percentage reserved could change. Some people in the audience pushed back.

“I don’t think reserving 13 units is going to have virtually any impact,” one resident said.

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The most current plan for the Hilton Head Christian Academy campus by Spandrel Development Partners. A previous application to rezone the site for 300 apartments was withdrawn after two hours of public comment on the issue on April 2. Spandrel Development Partners, released.

Commission member Caroline McVitty also cautioned that the units should not be part of a master-lease program with a local employer, such as the recently completed Park Lane development and the newly announced Alex Patterson Place.

Prohibit the apartments from being timeshares

The final concern held by the committee was that the apartments could be converted into for-sale condos or timeshares in the future.

Spandrel’s current request includes a 20-year restriction on the apartments being converted and sold, the application said.

But commission members suggested boosting that to 30 years, 40 years or eliminating the time frame altogether.

Neuman and his legal counsel Walter Nester said he didn’t know if that was possible.

“The more restrictions you put on a piece of real estate, the more difficult it is to get financing,” Nester said.

What’s next?

The request for rezoning will go next to Hilton Head Town Council.

If the recommendations by the planning commission are approved, Spandrel will need to prove they are complying each year when they renew their business license with the town, Nester said.

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Katherine Kokal moved to South Carolina in 2018 after graduating from the University of Missouri and loves everything about the Lowcountry that isn’t a Palmetto Bug. She has won South Carolina Press Association awards for in-depth and government beat reporting. On the weekends, you can find Kati doing yoga and hiking Pinckney Island.