It’s Hilton Head’s ‘empty eyesore.’ Now, developers have new plans for old Sam’s Club
Hilton Head Islanders have been asking for the old Sam’s Club building in Port Royal Plaza to be filled or redeveloped since it closed its doors four years ago.
They may be getting their wish, but it won’t be the Trader Joe’s many hoped would open on the island.
Instead, Hilton Head’s planning commission last week approved a zoning change that would make it possible for the owners of the empty section of Port Royal Plaza to open a self-storage facility in the 70,729-square-foot space.
Although some — including members of the commission who gave the zoning change unanimous preliminary approval last week — say anything is better than an empty commercial building on the island, the Go Store It storage facility would be just a half mile to the south of a Public Storage facility and a half mile to the north of Mathews Drive Mini-Storage.
If approved and opened, it would join nearly half a dozen storage facilities in a low-income census tract designated as an opportunity zone — a community where investors can get tax breaks for projects designed to create jobs.
The zoning change that would allow the storage units now must be approved twice by the Town Council. The first hearing is Feb. 16.
Plans for a new store flop
Sam’s Club closed its Hilton Head location in January 2017, two days before it opened a store about twice as large in Bluffton Gateway next to Walmart at U.S. 278 and S.C. 46.
The former Sam’s building sat vacant and, in late 2019, developers released plans for multiple businesses to open in the warehouse store’s wake. Architectural plans filed with the town showed the space divided to include Burke’s Outlet and its companion Home Centric furniture and home decor store. The Burke’s Outlet on Hilton Head would have been the retailer’s second location in Beaufort County; there is a store on Robert Smalls Parkway in Beaufort.
Another section of the space was expected to become Smart Company Kids Zone. Instead, that business, which features a ninja course, laser tag, a mirror maze and escape rooms, opened Jan. 22 in Bluffton’s Berkeley Place.
David Bloom, who originally developed the Port Royal shopping center with business partner Jim Bradshaw and others more than 35 years ago, was behind the 2019 redevelopment that saw Planet Fitness move into a section of the shopping center left vacant after a Bi-Lo grocery store closed.
Bloom said changes in the business climate because of the coronavirus caused the shift in plans with Burke’s Outlet and Home Centric.
“When the pandemic hit, our retail clients went away,” he said on Monday.
In July, that portion of Port Royal Plaza was sold to new owners. Madison Capital Group, based in Charlotte, specializes in converting empty big box stores to other projects.
Josh Tiller, of landscape architecture firm J.K. Tiller in Bluffton, said the plan is to renovate the inside of the building and put “a new skin on it” instead of demolishing the structure.
Although the approval process is pending, he said that work could be done in as little as six months. The plan for the site includes indoor storage units that are climate-controlled and, Tiller said, more secure than outdoor facilities.
Currently, there is a Go Store It self-storage facility on Parmenter Road in Bluffton and on Stockade Drive in Ridgeland. The company has locations in seven states in the eastern United States.
Tax breaks for storage facility?
As island leadership focuses on converting empty commercial space into new opportunities, the Sam’s Club building has been the source of near-constant suggestions by islanders — an indoor go-kart track, workforce housing and numerous retailers have all been considered in recent years.
The building sits in a crucial location on the island, directly off U.S. 278 and in an opportunity zone where new investment comes with tax incentives.
But the opportunity zones, legislation written by U.S. Sen. Tim Scott and adopted in 2017, are intended to bring investment and jobs to low-income communities. Storage facilities require little staffing or hiring, have a short construction timeline and therefore represent a low-risk investment opportunity.
This makes them popular in opportunity zones even though they fuel little community revitalization.
On Hilton Head, where island character is practically required of new development, residents have already suggested other routes for the central location.
“(I) would love to see creative mixed-use affordable housing and retail space. We need to think smarter and long term. Infuse the area and breathe some life into it,” Jennifer Ericksen wrote about the project on Facebook. “Looks industrial & cold. We already have enough storage going in. We can do so much better!!!!”
Madison Capital Group does not have to publicly report whether it’s taking advantage of opportunity zone tax credits. A call to the group Monday was not returned.
Meanwhile, members of the planning commission were relieved to review any plans for the vacant building, even if they questioned the proposed use.
“With everything that’s going on, it’s nice to see another open commercial space come off the market,” commissioner Alan Perry said.
Planning Commission chair Peter Kristian noted that the storage facility would require only five parking spaces, and that the owner intends to develop the parking lot in a “phase two,” if the zoning is approved.
Tiller, the Hilton Head native and landscape architect who applied for the rezoning, said even the storage facility would employ more people than the vacant building does now.
“At the end of the day, we’ve got an empty eyesore on the island,” he said. “Any activity other than an empty building is better.”
This story was originally published January 26, 2021 at 10:10 AM.
