Appeals court denies claims from HBF and Trask. Will Beaufort ever get hotel and parking?
The South Carolina Court of Appeals has upheld the city of Beaufort’s approval of a downtown hotel and parking garage in a victory for the city and Dick Stewart’s 303 Associates in a never-ending legal saga involving projects that opponents argue are too big for the city’s historic downtown.
In two previous lower court decisions, judges rejected legal challenges of Beaufort’s approval of the parking garage and hotel. Those lawsuits were brought by the Historic Beaufort Foundation (HBF), a not-for-profit that works to preserve historic properties, and Graham Trask, the owner of West Street Farms, LLC and Mix Farms, LLC, a downtown property owner and developer and rival of Dick Stewart, the founder of 303 Associates.
In rulings issued Wednesday by a three-judge Appeals Court panel, the higher court upheld those decisions, which came in January 2022 and June 2023, allowing the projects to proceed.
In their lawsuits, HBF and Trask have argued the city erred in approving the large projects for the city’s historic downtown. But the city has countered that the hotel and parking garage were considered multiple times in public meetings before the Historic District Review Board and Zoning Board of Appeals approved them in 2021. Stewart calls the lawsuits “frivolous.”
“So they are dismissed,” Stewart said Thursday, “and that cloud is removed over the project.”
Winning on appeal does not mean moving forward
But Stewart says construction of the parking garage and hotel will remain on hold despite the favorable outcome for the city and his company because of delays caused by the lawsuits.
“Because of these frivolous lawsuits and appeals we have suffered real damage and projects that made sense at a particular price when we were moving forward are now costing tens of millions more because of delays in construction and increased cost of financing,” Stewart said.
In July 2023, Stewart filed his own lawsuit against Trask that blames a “conspiracy of misinformation” about the hotel and parking garage for delays that have resulted in $40 million in losses. The lawsuit seeks $120 in damages — $40 million in actual damages from lost income, inflation-related increases in material labor and financing costs due to construction delays. The is rest is punitive damages including damage to reputation, personnel time and legal costs.
Trask denies causing delays
Trask has denied that the lawsuits had anything to do with delays in the project.
Trask and the HBF can petition the South Carolina Supreme Court for review of the decisions, which also requires a petition for rehearing before the Court of Appeals, the city of Beaufort said in a news release.
City Manager Scott Marshall said he was pleased with the rulings. The city said it spent $88,135 in its defense and noted its position had been upheld each time by the Circuit Court and now the Court of Appeals.
Trask called the Appeals Court rulings “unfortunate” and a defeat for the city of Beaufort. “We’re going to keep trying to hold the city accountable for its own laws,” said Trask. His next step will be asking the Court of Appeals for reconsideration and taking the case to the Supreme Court — if the the justices will hear it.
Cynthia Jenkins, HBF’s executive director, said a decision on whether to seek an appeal has yet to be made.
“The board will have to make that decision and we obviously haven’t had time to pull a meeting together,” she said.
The 72-room, four-story hotel is planned at the corner of Scott and Port Republic streets, while the three-story parking garage is on the block bordered by Charles, Craven and West streets. Stewart has previously estimated the cost of the two projects at $50 million.
Additional downtown parking is a need the city has debated for years, Stewart said. One study said the city had a 450-space shortage, and that was 10 years ago, Stewart said.
But where to put a large garage in the historic downtown and the size of the hotel have been sticking points with historic preservation interests.
Stewart, the owner of the Beaufort Inn and other downtown properties, proposed the parking garage for guests at his properties but also to help the city meet its parking needs for the general public. Stewart says he has enough property to handle the parking his businesses need without the parking garage but “everybody else will be denied parking.”
While the hotel and parking projects are on hold, 303 Associates is planning to move forward with 19-unit apartment project in the first half of 2025, Stewart said. The $7.5 million project is planned at 211 Charles St.
This story was originally published October 31, 2024 at 12:58 PM.
