Hilton Head marina was ravaged by hurricane, caught up in court. Now it’s being redone

Palmetto Bay Marina damage

Video of damage to Palmetto Bay Marina on Hilton Head Island.
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Video of damage to Palmetto Bay Marina on Hilton Head Island.

A marina that first opened on Hilton Head Island in 1958 has announced plans to rebuild three years after it was nearly destroyed by Hurricane Matthew.

Palmetto Bay Marina, on Helmsman Way near the base of the Cross Island Parkway on Hilton Head, updated its Facebook cover photo to show a sketch of the new plans — which are divided into two phases set to begin in October 2019 and 2020.

The marina is also under new ownership. Palmetto Bay Marina LLC took title of the property about six weeks ago, according to Kuy Scott, a representative of the company.

“We’re going through cleaning everything up,” Scott said. “We’re excited and Palmetto Bay should be excited.”

Palmetto Bay Marina LLC has been doing demolition of the existing bathrooms and aesthetic improvements on the buildings in the marina for the past two weeks, Scott said.

The new designs for the marina are from Barrier Island Marine contractors, a Hilton Head-based company.

The renovation includes several new aluminum docks with space for around 144 boats, according to Scott. Once the land plans are approved by the Town of Hilton Head Island, Scott said the marina will have more parking and new landscaping.

The history of the marina

The Palmetto Bay Marina has been caught in litigation for several years since it was damaged by the hurricane.

It was purchased in March 2016 for $6.27 million by the then-bankrupt Melrose Resort on Daufuskie Island, Palmetto Bay Partners, which assumed $4.2 million in mortgage indebtedness with the property.

That deal came amid a lawsuit filed by other prospective marina buyers, Hilton Head residents Jason and Cynthia Bullock, who said they were owed $250,000 in earnest money from former marina owner Douglas James of Cross Island Associates, The Island Packet has reported.

Floating storm debris 1
Workers assess the damage of docks at Palmetto Bay Marina on Hilton Head Island. The docks were destroyed by Hurricane Matthew, which hit the island on Oct. 8. Jay Karr jkarr@islandpacket.com

James’ former lawyer in the real estate deal with Palmetto Bay Partners, Stephen Carter of Port Royal, was charged with taking $100,000 from James’ escrow account and using it to buy a car, pay alimony and other personal and business expenses, according to previous reporting by The Island Packet.

Carter was disbarred in November by the state Supreme Court and ordered to pay back the $100,000, with interest and legal costs by the end of 2015, The Island Packet has reported.

But that didn’t happen.

Palmetto Bay Marina on Hilton Head Island’s South End flooded at 1 p.m. Monday, Sept. 11, 2017 as Tropical Storm Irma pushes the tides in. Submitted by Todd Romoser

In May 2017, former owner of the marina James died in his Boulder City, Nev. home by a gunshot wound. His death was ruled a suicide, Jeanne Pitre of the Clark County Office of the Coroner told The Island Packet in 2017.

When he died, James was involved in a foreclosure claim from Wells Fargo Bank for the Palmetto Bay Marina property, a breach of contract lawsuit along with a suit from his former wife for foreclosure.

Palmetto Bay Marina sold

The Pelorus Group held ownership of the marina until April 5, 2019, when Palmetto Bay Marina, LLC. purchased it for $5 million, according to the Beaufort County Register of Deeds.

Now, Scott said things are finally looking up for the marina.

“There was so much litigation that was involved,” he said Friday. “But (the new owner) is as stable of a financial partner as you can have.”

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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.