Failed talks over ownership of Melrose Landing on Daufuskie leads Beaufort Co. to condemn dock
The Beaufort County Council failed to reach a deal with the prospective buyers of the long-abandoned Melrose Resort in its quest to establish a permanent embarkment point for the Daufuskie Island Ferry.
As a result, the council at its Sept. 12 meeting passed on third reading an ordinance to condemn the Melrose Landing, once again stalling the sale of the resort and dividing residents on the island.
The county has identified two locations to serve as permanent embarkments for the ferry — one a parcel of land on Helmsman Way, on Hilton Head Island, the other Melrose Landing on Daufuskie Island.
The condemnations will go before a judge where the county must argue why it’s a public necessity to own the properties. Dates for the hearings have not been set.
People who live full time on Daufuskie — about 557 people according to the 2020 census — rely on ferries to get on and off the island. The county-operated Daufuskie Island Ferry was used by residents 3,750 times and non-residents 22,500 times in 2021, according to county data.
“For those who ride the county ferry, this is an issue that transcends all other considerations,’‘ said Beth McIntyre, secretary for the Daufuskie Island Council, who spoke at the Sept. 12 County Council meeting. “It is about a way of life, that for some of us, is only made possible by public transportation.”
The county has set aside $4.3 million for both lots, according to county spokesman Chris Ophardt.
In the meantime, the sale of the abandoned resort has been be put on hold. The dock is essential for anyone interested in buying the resort, according to regenerative developers, Whitestone Resources, who are preparing the resort for sale to their parent company Whitestone Holdings LLC.
“Access is a critical component, it’s a linchpin to operate a resort on the island,” said Tim Pitcher, president of Whitestone Resources. “If this condemnation goes forward, the sale will be indefinitely postponed until there’s a resolution.”
In 2021, the county signed a three-year contract with Haig Point to operate the ferry service. Haig Point leases Melrose Landing from Redfish, the current owners who are represented by Pitcher as an asset manager, for the public ferry’s embarkment on Daufuskie.
That lease is set to end this month. Considering the county is moving forward with condemnation and couldn’t come to leasing agreements with Whitestone previously, the future of that lease and the ferry service is uncertain.
“We hope to come to an agreement,’‘ said Ophardt. “We will take all actions to keep the ferry service for the residents of Daufuskie.”
Last fall, Whitestone began working to prepare the abandoned Melrose Resort for sale. The sale was originally set to close on June 30. Just days before, on June 27, the County Council voted on first reading to condemn the dock at Melrose Landing, putting the sale on hold for the first time.
A month later, a public meeting was held by both County Administrator Eric Greenway and Pitcher on July 27 about the future of the Melrose dock. At that meeting it was announced that Beaufort County and Whitestone were close to reaching a deal where Beaufort County would own the dock and use the northern side for ferry operations and leave the southern side of the dock for Whitestone’s use.
However, that deal fell through after the county and Whitestone failed to come to financial terms on the purchase, according to Ophardt.
Subsequently, the two parties discussed the possibility of Beaufort County leasing the dock from Whitestone until a permanent solution could be identified. Whitestone offered a leasing amount of $10,000 a month for the county’s use of the dock, which Pitcher said was the market rate. These terms were presented to the County Council in executive session, according to Ophardt, but the council inevitably decided to condemn the dock.
What’s best for the Island?
Residents of Daufuskie Island have been divided on this issue since before the first reading on June 27.
The Daufuskie Island Council sees the county’s ownership of the dock as essential for the future of Daufuskie because of the ferry improvements the county says will come.
“We’re really excited about the interest that Beaufort County has taken in Daufuskie Island,” said Island Council Chair Roger Pickney. “The river is our road. It would be like a freeway where the on ramp is owned by a local landowner.”
Ron Angle, the owner of Daufuskie Carts, a cart rental busienss that operates out of Melrose Landing, would prefer the county to own the landing.
“It [condemnation] had to happen for the sustainability of the island,” said Angle “The local businesses, the tourists that come here, they need to have a place where they can bring the boat in and out and not have to be stressed about, you know, whether a new owner or a third party is going to come in and charge too much rent or make new restrictions or just make life difficult.”
When Whitstone Resources came in to prepare the resort for sale, businesses that operate out of Melrose Landing were offered new leases for the space they occupy. The leases were much more expensive, sometimes 10 times more than what the businesses were paying before, according to some business owners
Much like the lease agreements offered to the county, Pitcher says the businesses were offered a market rate for their rent.
On the other side of the issue, many people have lived around the abandoned Melrose Resort for over a decade. A revitalized resort would see their property values increase leaving many of them to prefer Whitestone’s purchase of the resort go through.
Bill Werkheiser, president of the Melrose Cottage Association, which is made up of about 40 of the 100 homes in the Melrose Resort, said the announcement of the sale of Melrose saw property values in the area nearly quadruple from $10,000 for a lot to $35,000-$40,000.
“The county is worried more about transporting thousands of people over that visit [Daufuskie], than they are about the landowners and stakeholders that live there, said Werkheiser.”
Rep. Jeff Bradley, who represents both Hilton Head and Daufuskie in the South Carolina House of Representatives, is frustrated to see the county undermine what he described as a “significant capital infusion” for the island.
“I bristle any time somebody is using the long arm of the government to abridge somebody’s property rights,” Bradley said.
Regardless of who eventually takes ownership of Melrose Landing, improvements will be coming. Both the county and Whitestone have announced plans to add restrooms and improve parking at the landing.
It’s still possible for the two parties to reach an agreement before the condemnation hearing in court and avoid it entirely, according to Ophardt.
