Nonprofit plans to buy Hilton Head condos and rent them to local workers. Here’s where
Pick-up trucks with ladders and vans with catchy business slogans dot the bridge to Hilton Head Island each morning. Sitting behind them in bumper-to-bumper traffic on the U.S. 278 corridor, there’s plenty of time to read the catchphrases.
The vehicles’ drivers represent the growing number of workers who can’t afford to live where they work: around 14,000 workers commute to the island each day. Some travel as far as 50 miles to get there.
A newly formed non-profit joined forces trying to change that last year, and now it’s asking for the Town of Hilton Head’s financial help. The Coastal Community Development Corporation (CCDC) plans to buy condos on Hilton Head and rent them to local workers for adjusted prices based on income. The town could potentially provide money to help with down payments, but Mayor Alan Perry said he worries about unintended consequences for other Hilton Head residents, among other concerns.
“I would like to have more depth and a complete, clearer, understanding,” said Perry, of what was needed before he felt comfortable fully supporting the CCDC’s $600,000 request for town funds.
Perry said he thought the funds should stretch further. The nonprofit plans to use the money for 12 or 13 condo down payments on the island. The condos that the CCDC is considering purchasing are mostly on the north end of the island.
He also pointed out the potential for the initiative to make homes more expensive for other residents by impacting mortgage financing eligibility. He said they need to be careful not to make currently warrantable communities non-warrantable, meaning that if there is over a certain percentage of renters in an association, it could impact Federal Housing Administration loan eligibility for others in the building.
The CCDC’s total budget is $3 million, or an average of about $250,000 for each condo. It already purchased six units with donations from residents and loans from members of Hilton Head’s Long Cove Community, according to board member Alan Wolf. He is the president of the SERG Restaurant Group and one of the community leaders who helped form the CCDC in May 2023.
“We’re going to do future requests in other gated communities,” Wolf said.
But right now, the request is for town funds. In a 5-2 vote last month, the town council approved a Memorandum of Understanding, but it still needs budget approval. If approved it would be the first time the group receives town money and the vote on whether to approve it is slated for town council later this month, according to Perry. The money would be raised from the state accommodations tax visitors pay when they stay at hotels or Airbnbs.
It wouldn’t be the first time they receive government funding. Beaufort County reallocated $600,000 in American Rescue Plan Act funds to the CCDC Dec. 11.
“Beaufort County actually beat Hilton Head to the punch, but it’s the same sort of approach,” Wolf said.
The approach, outlined in the Memorandum of Understanding, now includes added language, partially due to the concerns Perry voiced: that the purchases within complexes don’t jeopardize associations eligibility for Federal Housing Administration loans, and that the CCDC is in compliance with 501(c)(3) requirements.
