Beaufort News

County Council scheduled to revisit commerce park purchase proposal at month's end

When Beaufort County Council revisits a proposed $2.5 million commerce-park purchase at the end of this month, elected officials will have some, but not all, of the additional information they have sought.

After council voted twice to buy the Beaufort Commerce Park, it voted Feb. 14 to postpone a final decision for 60 days to appraise the property and review the county's approach to economic development. The deadline is Friday, and the council's next meeting after that is April 25.

One of two appraisals has arrived, and the other is close behind.

But the task force appointed to review industry-hunting efforts says it needs much more time.

APPRAISED VALUE

The county has contracted with two companies, at $3,500 each, to provide separate appraisals. County administrator Gary Kubic said he decided to seek two estimates because of the high-profile nature of the purchase proposal.

An appraisal performed by Ray Murphy of Mount Pleasant was delivered last week . The other will be finished this week, Kubic said.

Murphy provided two values -- a $3.675 million retail value and a $2 million discounted market value.

The higher figure, Murphy said in an interview, is an estimate of total revenue if the park were sold in 10-acre sections to businesses for development. That figure is then discounted to a $2 million market value -- the amount an individual probably would be willing to pay for the entire property as an investment.

"What we're theoretically trying to do is figure out what one person would pay for all the 10-acre pieces and resell them at a profit," Murphy said.

Such discounting is a common appraisal technique, he said, and is often required by banking regulations.

In 2009, the commerce park was valued at $3.75 million. Murphy said that number includes the same type of discounting as his $2 million figure, so those two values roughly correspond.

Several County Council members reached Friday had not yet fully examined the 51-page appraisal; weren't sure which of Murphy's two figures were important for council's purposes; or said the figures were open to interpretation.

Councilman Brian Flewelling, who has voted against the purchase, said he thinks the $2 million figure could end any talk of buying the property for $2.5 million.

"I know that if we did, it would be a breach of our fiduciary responsibility," he said.

MORE TIME SOUGHT

A review of county economic development efforts has made headway but might not be finished for several months.

The Economic Development Task Force consists of five businessmen appointed by council Chairman Weston Newton.

"It just seemed that we needed a process that included business people on the outside looking in," Newton said.

During the task force's first meeting Monday, its members and county administrator Kubic said the review will take them past the Friday deadline.

"I think you're talking four to six months," said Don Ryan, CEO of CareCore National and a task force member. Ryan also serves on the board of the Lowcountry Economic Network, the county's public-private economic development partner that wants the county to buy the commerce park from it.

When County Council postponed a vote on the commerce park purchase, council members debated whether the 60-day timeline was too short. According to meeting minutes, Councilman Jerry Stewart voted against delay "because we'll come back to it in 60 days and be no closer to a solution."

Stewart said in an interview Friday the task requires more time, particularly if the group decides it needs the advice of a paid consultant.

"There's no way in the world it could happen," Stewart said. "Council knew that."

County staff has contacted three economic development consultants about involvement in the review. Two responded and will be interviewed by task force members April 25.

Task force members said during their meeting they hope a consultant could gather information about the job-creation strategies and incentives throughout the state and region.

"There's no way we're going to have the time or expertise to get that detailed information back," said Gary Horn, market president of Coastal Banking Co.

David Tigges, CEO of McNair Law Firm and chairman of the Hilton Head Island-Bluffton Chamber of Commerce, said a consultant might be able to get better information from economic development groups that compete with Beaufort County.

"I also think they'll be able to get to the executive directors of those other organizations and get more truthful answers kind of quietly than if we're doing it," he said. "Because they are competitors."

DEED HANDOFF

Negotiations also have been ordered in an attempt to keep the commerce park from foreclosure, but it's unclear where that process stands.

The Lowcountry Economic Network bought the park in 2006, but it can no longer afford the debt.

Network board members voted unanimously Feb. 25 to offer the park back to lenders -- a "deed in lieu of foreclosure" agreement in which banks would forgive the network's debt.

Stewart said Friday no deal has been struck.

Ian Leslie, the network's marketing and membership director, wrote in an email that he is unable to comment since the deal is "a legal issue and in the midst of negotiations."

"Any update would be made to our executive committee and board in executive session," he wrote.

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