Sun News - Jimmy Buffett's popular Margaritaville brand is bringing another restaurant concept to Myrtle Beach, with plans to build a Land Shark Bar & Grille on the oceanfront. Land Shark, Margaritaville's brewing company that makes Land Shark Lager known for its blue and yellow fin-wave logo, plans to open in May as part of the SkyWheel attraction, a nearly 200-foot-high Ferris wheel that is under construction beside Plyler Park. The 3,000-square-foot restaurant will have mostly outdoor seating, said David Busker, president of Koch Development Co., which will operate the SkyWheel and is developing it along with Pacific Development. Busker declined to talk about the restaurant's name and concept, but said Koch wanted to partner with anestablished operator to make the most of the restaurant's good location on the oceanfront.
Officials are staying tight-lipped about the restaurant. Al Mers, a partner in Pacific Development, said Wednesday that he couldn't comment about the restaurant until Dec. 15. The Myrtle Beach Community Appearance Board will likely consider the restaurant's plan for signs on and around the restaurant building on Dec. 16. Officials representing Buffett and the Margaritaville brand could not be reached Wednesday. There's a Land Shark Landing restaurant in Pensacola, Fla., beside the Margaritaville Beach Hotel, that serves items such as fish tacos, nachos and, of course, a Cheeseburger in Paradise fixed the way Buffett describes in the song by the same name. It's unclear whether the Land Shark Bar & Grille in Myrtle Beach will serve similar food. The restaurant will be part of the $12 million to $15 million SkyWheel complex emerging on the oceanfront. Crews are installing the 106 pilings that will support the nearly 200-foot-high Ferris wheel, which will have 42 glass-enclosed, temperature-controlled gondolas that plan to operate year-round.
The Land Shark restaurant will be a different kind of venue for downtown Myrtle Beach that will lure Buffett's followers who are likely to check out downtown's other offerings after stopping by the new restaurant, said Dave Sebok, executive director of Myrtle Beach's Downtown Redevelopment Corp. "It will offer something that is obviously new and has a different theme to it than what we have on the oceanfront now," he said. "It's a name that is nationally and internationally known so to me it's likely to be able to attract customers and business downtown." Buffett's business ventures have fit well in Myrtle Beach. Buffett's Margaritaville restaurant at Broadway at the Beach opened six years ago. There's also a Cheeseburger in Paradise restaurant on the north end of Myrtle Beach, which is owned by Paradise Restaurant Group with a license from Buffett.
The power of the Buffett brand - and its national publicity - will be a plus for downtown Myrtle Beach, Sebok said. "I think it is a great addition to downtown," he said. "It will bring in a national company that will promote that location and the downtown." The wheel and restaurant complex will be the second major addition to Myrtle Beach's oceanfront in two years. Earlier this year, the $6 million, 1.1-mile boardwalk debuted.
Wednesday
Ripken Experience in Myrtle Beach expands
Sun News - Check the stat sheet for The Ripken Experience-Myrtle Beach this year, and there's one number general manager Bobby Holland just doesn't like to see. One hundred thirty. That's the number of teams of 13-year-olds and older that couldn't play in one of the complex's tournaments because there weren't enough fields. That's about to change. Work to add a third field for players ages 13 and older - the complex's eighth field overall - started this week. That $1 million investment will allow between 100 and 140 more teams the chance to play at The Ripken Experience next year, Holland said.
"It is going to have a tremendous impact on business," he said, walking through what will become the diamond's infield. "We had just been having to turn teams away. We just couldn't get them in because we only had two fields [for that age group]." Business at The Ripken Experience, a partnership between Hall of Famer Cal Ripken Jr. and Burroughs & Chapin Co. Inc., has been brisk since the 50-acre complex opened off Mr. Joe White Avenue in Myrtle Beach in 2006, Holland said. Teams from across the country and overseas come to compete in tournaments on the AstroTurf fields and learn lessons of the game infused into the program by the Hall of Famer.
Like other tourism businesses along the Grand Strand, The Ripken Experience had a solid summer. More than 400 teams played during the 10 weeks of summer tournaments, with business up 26 percent from summer 2009, Holland said. Players came from as far away as Canada and Kuwait, he said. Some of the tournaments for next summer already are sold out. The complex is a component in the Grand Strand's push to increase sports tourism, with the Ripken name luring visitors who might never have come to Myrtle Beach otherwise but are likely to return once they see what the area offers, said Brad Dean, president of the Myrtle Beach Area Chamber of Commerce.
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"It is going to have a tremendous impact on business," he said, walking through what will become the diamond's infield. "We had just been having to turn teams away. We just couldn't get them in because we only had two fields [for that age group]." Business at The Ripken Experience, a partnership between Hall of Famer Cal Ripken Jr. and Burroughs & Chapin Co. Inc., has been brisk since the 50-acre complex opened off Mr. Joe White Avenue in Myrtle Beach in 2006, Holland said. Teams from across the country and overseas come to compete in tournaments on the AstroTurf fields and learn lessons of the game infused into the program by the Hall of Famer.
Like other tourism businesses along the Grand Strand, The Ripken Experience had a solid summer. More than 400 teams played during the 10 weeks of summer tournaments, with business up 26 percent from summer 2009, Holland said. Players came from as far away as Canada and Kuwait, he said. Some of the tournaments for next summer already are sold out. The complex is a component in the Grand Strand's push to increase sports tourism, with the Ripken name luring visitors who might never have come to Myrtle Beach otherwise but are likely to return once they see what the area offers, said Brad Dean, president of the Myrtle Beach Area Chamber of Commerce.
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Horry County envisions aviation mecca; Myrtle Beach International to see $1.7mil facelift
Sun News - "Building 325" might sound mysterious, like a structure you'd find at Nevada's Area 51. But it's actually just a vacant hangar at the Myrtle Beach International Airport that is getting a lot of attention these days. It might even be getting a new tenant. Building 325 dates back to the military air base days. It needs renovation so it can become home to new aeronautics-related industry, said airport spokeswoman Lauren Morris. With 400 acres open at and around the airport, a planned technology and aerospace park, aviation businesses like Avcraft expanding, and industry giant Boeing locating not far away, Horry County is poised to become an aviation mecca, said County Council Chairwoman Liz Gilland.
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Monday
Wonder Works coming to Myrtle Beach
CBL - Wonder Works, an amusement park for the mind that will combine education and entertainment, is coming to Broadway at the Beach in Myrtle Beach, at the site of the former Crab House Reastaurant. The venue will offer more than 100 hands-on exhibits, with opportunities to lie on a bed of 3,500 nails, be blown away by 74 mph winds, ride a 360-degree virtual roller coaster, manuever the controls of a NASA spacecraft to land the Shuttle, pilot a figher jet, play virtual sports and lazar-tag and participate in numerous other adventures.
At 97 feet in height and 50,000 square feet, with the appearance of being upside down, the WonderWorks construction will include 145 tons of rebar, 315 tons of structural steel, 2,100 cubic yards of concrete, 47 artificial updide down window boxes and 8 artificial palm trees. Already operational on site are a Zipline that takes participants 1,000 feet between towers, 50 feet above the water, and a pirate-themed ropes course that stands 40 feet tall, spans three levels and includes 33 different challenge elements with more than 3,000 ropes and cables.
The Broadway and the Beach venue will be the fourth WonderWorks. The others are in Orlando and Pananama City Beach, Fla., and Pigeon Forge, Tenn. The hands-on amusement park is the brainchild of attorney and developer John B. Morgan, who lives in Florida, and Robin L. Turner, who resides in Tennessee and has a background in special event and fair/attraction management. In 1997, the two men co-founded Attraction Concepts, Ltd., which opened the first WonderWorks attraction in Orlando in 1998.
WonderWorks, which is scheduled to open in March 2011, will offer group and combo packages to fit various groups and budgets.
At 97 feet in height and 50,000 square feet, with the appearance of being upside down, the WonderWorks construction will include 145 tons of rebar, 315 tons of structural steel, 2,100 cubic yards of concrete, 47 artificial updide down window boxes and 8 artificial palm trees. Already operational on site are a Zipline that takes participants 1,000 feet between towers, 50 feet above the water, and a pirate-themed ropes course that stands 40 feet tall, spans three levels and includes 33 different challenge elements with more than 3,000 ropes and cables.
The Broadway and the Beach venue will be the fourth WonderWorks. The others are in Orlando and Pananama City Beach, Fla., and Pigeon Forge, Tenn. The hands-on amusement park is the brainchild of attorney and developer John B. Morgan, who lives in Florida, and Robin L. Turner, who resides in Tennessee and has a background in special event and fair/attraction management. In 1997, the two men co-founded Attraction Concepts, Ltd., which opened the first WonderWorks attraction in Orlando in 1998.
WonderWorks, which is scheduled to open in March 2011, will offer group and combo packages to fit various groups and budgets.
Local developer rescues Gateway development in Wilmington
Star News - The local businessman is breathing life into an otherwise foundering development at the base of the Cape Fear Memorial Bridge. A federal judge ruled this week the sale of the Gateway property to Pickett could move forward. River 2 Sea LLC, the company that owns the land intended for the 11-story development in downtown Wilmington, filed Chapter 7 bankruptcy in August, less than an hour before the land was scheduled to be sold at auction. River 2 Sea had already entered into a contract to sell the land to Pickett but trouble with financing got in the way of the $8.4 million sale. Now Pickett has secured a $98 million construction loan from a consortium of hedge funds, he said. “He’s found a new lender. That’s the challenge, to find a lender in these difficult times,” River 2 Sea owner John Evans said.
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Oak Island builders weigh impacts of sewer service / fees
Star News - New building projects in Oak Island will be subject to higher sewer tap and impact fees now that the town council has approved a 50 percent increase at the town staff’s recommendation. Local builders say the new wastewater system is providing more opportunities but some headaches, as well. The council voted unanimously last week to approve the new fees, which town officials say are needed to pay for the ever-increasing cost of the wastewater system and to tie the fees to actual tap costs and usage.
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Housing Market in the Carolinas
Housing Intelligence - With the surge in distressed real estate sales over the past couple of years, new homes have made up a smaller portion of overall housing activity. Based on data from Housing IntelligencePro, the proportion of new home sales declined to 9.5% of total home sales in the third quarter of this year compared to 10.5% during the same period a year ago. However, there were some areas across the country that did experience an increase in new home activity. Our data feature of the week focuses on places with the largest share of new home sales as a portion of the overall market, with a minimum of 1,000 closings during the quarter. The results show that the Carolinas stick out. Fayetteville, NC had the highest number of new home sales as a percentage of the overall market. Over 32% of all the homes closed in the third quarter were in the new homes segment which is up about 31% during the third quarter of last year. The fourth and ninth highest concentrated markets, Huntsville, AL and Charlotte, NC, both also experienced an increase in new home activity compared to year-ago levels. Ten out of the top-17 areas across the U.S. with the highest concentration of new home sales activity were in the Carolinas.
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Multifamily Sector Posts Record Occupancy Gains
Multifamily Executive - The multifamily real estate sector posted its greatest quarterly occupancy gain in the third quarter and is poised to continue to benefit from single-family housing market decompression throughout 2011, commercial real estate economists said this week in separate forecasts delivered by New York City-based REIS and Washington, D.C.-based Jones Lang LaSalle. While anemic GDP growth continues to hamper improvements to the unemployment picture, jobs are being added, and optimism of broader economic recovery is giving renters—particularly in the Gen Y millennial demographic—the confidence to double-down out of roommate and live-at-home situations.
“National vacancy levels fell by 70 basis points from 7.8 percent to 7.1 percent,” said REIS director of research Dr. Victor Calanog. “This is one of the sharpest drops in vacancy on record, and pent-up demand from renters [opting out of] living with their families or other roommates seems to be driving these results.” According to REIS, the third quarter also saw record net absorption of 94,000 units, with 90 percent of absorption coming from existing buildings leasing empty units.
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“National vacancy levels fell by 70 basis points from 7.8 percent to 7.1 percent,” said REIS director of research Dr. Victor Calanog. “This is one of the sharpest drops in vacancy on record, and pent-up demand from renters [opting out of] living with their families or other roommates seems to be driving these results.” According to REIS, the third quarter also saw record net absorption of 94,000 units, with 90 percent of absorption coming from existing buildings leasing empty units.
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Tuesday
New Oak Island bridge opening delayed again
Star News - The opening of the new Oak Island bridge has been delayed yet again, an N.C. Department of Transportation official said Tuesday. No official date has been set for the opening of the $36.6 million bridge over the Intracoastal Waterway, but it is now not anticipated until the first or second week in November, said Mark Blalock, assistant resident engineer in the NCDOT Wilmington office. The estimate had been by the end of October for the last few months. Construction crews lost a week of work because of the heavy rains and flooding in late September, Blalock said. Workers must still complete the pavement markings, guard rails and a few other tasks, he said. Blalock said it is looking more likely that only one lane in either direction will be opened to traffic at first while construction is completed. Should the bridge open in mid-November, it will be nearly 11 months behind schedule.
Inlet Square Mall Owner Announces Increase in Leasing
RAIT Financial Trust is pleased to announce that, since taking control of Inlet Square in Murrells Inlet, South Carolina in September of 2009, seven new leases in excess of 20% of the property, or approximately 90,000 square feet, have been signed. As a result of these leases, the occupancy rate will increase to approximately 90% from 68% in September 2009. Key leases signed since RAIT acquired Inlet Square include a cinema and entertainment venue, an apparel store and a nationally recognized kids store.
Inlet Square is a 430,000 square-foot mall anchored by JC Penney, Belk, Kmart and Stein Mart. It recently underwent a $4.5 million renovation to help attract new tenants. Scott Schaeffer, RAIT’s Chief Executive Officer and President, commented, “This is a good example of RAIT using its core real estate knowledge and capabilities to create value within its commercial real estate portfolio.”
Inlet Square is a 430,000 square-foot mall anchored by JC Penney, Belk, Kmart and Stein Mart. It recently underwent a $4.5 million renovation to help attract new tenants. Scott Schaeffer, RAIT’s Chief Executive Officer and President, commented, “This is a good example of RAIT using its core real estate knowledge and capabilities to create value within its commercial real estate portfolio.”
Wal-mart Unveils Plans For New Smaller Store Format
Bill Simon, Wal-Mart’s U.S. president and CEO, explained in a statement that the company will move to a three-format portfolio. The large format is the Walmart supercenter, which carries both groceries and general products. The next size smaller — stores between 30,000 square feet and 60,000 square feet — will be based on a market’s specific needs, and the new under 30,000 square foot template will be aimed at small towns and urban markets, according to the statement.
South Carolina Community Impact
Real Estate
As of September 2010, Walmart's presence in South Carolina includes:
Supercenters: 71
Discount Stores: 5
Neighborhood Markets: 0
Sam's Clubs: 9
Distribution Centers: 2
Average store size (national average)
Supercenter: 185,000 sq. ft. with approx. 142,000 items
Discount Store: 108,000 sq. ft. with approx. 120,000 items
Neighborhood Market: 42,000 sq. ft. with approx. 29,000 items
Sam's Club: 132,000 sq. ft. with approx. 5,500 items
People
•As of September 2010, the total number of Walmart associates in South Carolina is 28,255.
•As of September 2010, the average wage for regular, full-time hourly associates in South Carolina is $12.61 per hour (Walmart Discount Stores, Supercenters, and Neighborhood Markets). Additionally, associates are eligible for performance-based bonuses.
•In recent years, Walmart has contributed four percent of an associate's eligible pay to their combined Profit Sharing and 401(k) Plan.
Suppliers
•In FYE 2010, Walmart spent $812,224,336.00 for merchandise and services with 753 suppliers in the state of South Carolina. As a result of Walmart's relationship with these suppliers, Walmart supports 32,683 supplier jobs in the state of South Carolina.
•Supplier figures provided by Dun & Bradstreet.
Taxes and Fees
•Walmart collected on behalf of the state of South Carolina more than $244.6 million in sales taxes in FYE 2010.
•Walmart paid more than $35.3 million in state and local taxes in the state of South Carolina in FYE 2010.
Community Involvement
•In 2009, Walmart stores, Sam's Club locations and the Walmart Foundation gave more than $6.6 million in cash and in-kind donations to local organizations in the communities they serve in the state of South Carolina. Through additional funds donated by customers, and Walmart and Sam’s Club associates throughout the state, the retailer’s contributions in South Carolina totaled more than $9.2 million.
South Carolina Community Impact
Real Estate
As of September 2010, Walmart's presence in South Carolina includes:
Supercenters: 71
Discount Stores: 5
Neighborhood Markets: 0
Sam's Clubs: 9
Distribution Centers: 2
Average store size (national average)
Supercenter: 185,000 sq. ft. with approx. 142,000 items
Discount Store: 108,000 sq. ft. with approx. 120,000 items
Neighborhood Market: 42,000 sq. ft. with approx. 29,000 items
Sam's Club: 132,000 sq. ft. with approx. 5,500 items
People
•As of September 2010, the total number of Walmart associates in South Carolina is 28,255.
•As of September 2010, the average wage for regular, full-time hourly associates in South Carolina is $12.61 per hour (Walmart Discount Stores, Supercenters, and Neighborhood Markets). Additionally, associates are eligible for performance-based bonuses.
•In recent years, Walmart has contributed four percent of an associate's eligible pay to their combined Profit Sharing and 401(k) Plan.
Suppliers
•In FYE 2010, Walmart spent $812,224,336.00 for merchandise and services with 753 suppliers in the state of South Carolina. As a result of Walmart's relationship with these suppliers, Walmart supports 32,683 supplier jobs in the state of South Carolina.
•Supplier figures provided by Dun & Bradstreet.
Taxes and Fees
•Walmart collected on behalf of the state of South Carolina more than $244.6 million in sales taxes in FYE 2010.
•Walmart paid more than $35.3 million in state and local taxes in the state of South Carolina in FYE 2010.
Community Involvement
•In 2009, Walmart stores, Sam's Club locations and the Walmart Foundation gave more than $6.6 million in cash and in-kind donations to local organizations in the communities they serve in the state of South Carolina. Through additional funds donated by customers, and Walmart and Sam’s Club associates throughout the state, the retailer’s contributions in South Carolina totaled more than $9.2 million.
How Long Can Cap Rate Compression Last?
Multifamily Executive - Many multifamily buyers and sellers have been surprised at just how quickly, and how steeply, cap rates have fallen this year. Several factors have conspired to drive down cap rates a little more each month this year. A wealth of opportunity funds looking for acquisitions has resulted in frenzied bidding wars for Class A assets. Low-priced debt from Fannie Mae and Freddie Mac has allowed more deals to pencil out. And stabilizing fundamentals have inspired confidence in the future value proposition. But just how sustainable is this cap rate compression? Most multifamily finance professionals don’t expect it to last into next year. In a poll of 168 senior-level professionals conducted by Apartment Finance Today conducted in August, half of all respondents expected cap rates to stay flat in 2011, while more see cap rates rising (27 percent) than falling (23 percent) next year.
“It has to level off,” says Mike McRoberts, national head of production and sales for McLean, Va.-based Freddie Mac. “One thing that’s going to drive cap rates is availability of product, and we’ve already seen an increase in availability of product. That has to have an upward pressure on cap rates.” In the first six months of the year, there were about 29 multifamily transactions of $10 million or more with cap rates of 6 percent or less. Yet, since the beginning of July—in a span of just over three months—there have been 28 such transactions, according to market research firm Real Capital Analytics. These range from the very large—last month’s $193 million acquisition by CBRE of the Resort at Pembroke Pines in Hollywood, Fla., drew a 6 percent cap—to smaller assets, such as the $25.5 million acquisition by Trinity Property Group of the 76-unit Clay Park Towers in San Francisco, which had a 5 percent cap rate.
While some of today’s cap rates seem aggressive, when you factor in the price of debt from Fannie and Freddie—around 4 percent for a 10-year loan, and sub-4 percent for a seven-year loan—it makes sense. “If you’re buying a quality property in a core market with a going-in cap rate around 6 percent, and you’re getting 75 percent leverage at 4 percent, you’re getting huge positive leverage,” says David Rifkind, principal and managing director of Los Angeles-based George Smith Partners. “You’re spitting out cash flow.” Some in the industry are marveling that in the high-barrier coastal markets, there’s been a return to the cap rates seen at the height of the last boom period. But one notable difference is that cap rate compression is only really seen on the upper echelon of deals in select markets. “I think we’ll continue to see the cap rate differentiation that we hadn’t seen four or five years ago,” says Michael Berman, president and CEO of Needham, Mass.-based CWCapital. “We’re seeing cap rates of 4 percent for really fine, triple A properties, but B and C properties aren’t seeing that kind of compression.”
The high-barrier coastal markets have experienced the biggest cap rate declines. But some believe that the dynamic will soon begin to emerge in the Midwest as well. “On the coasts, it’s always a little bit of an anomaly. In the Midwest, we’re not seeing a lot of transactions of stabilized, well-occupied properties yet,” says Greg Cazel, executive vice president of Midwest markets for Boise, Idaho-based lender A10 Capital. “But as we continue to see leasing and occupancy strengthen like we’ve seen for the past 18 months, I think cap rates are going to continue to come down.” Everyone knows, however, that today’s interest-rates can’t last, and that it’s impossible to time the bottom. The economy will enter into an inflationary period sooner or later. “Based on the federal deficit and the capacity of the economy, at some point we’re going to be back in an inflationary period,” says Berman. “And when that happens, cap rates will drift up again.” But for now, interest rates continue to fall and the pace of transactions continues to rise. The fourth quarter is shaping up to be the kind of “busy season” that we haven’t seen in a few years. Carpe Diem.
“It has to level off,” says Mike McRoberts, national head of production and sales for McLean, Va.-based Freddie Mac. “One thing that’s going to drive cap rates is availability of product, and we’ve already seen an increase in availability of product. That has to have an upward pressure on cap rates.” In the first six months of the year, there were about 29 multifamily transactions of $10 million or more with cap rates of 6 percent or less. Yet, since the beginning of July—in a span of just over three months—there have been 28 such transactions, according to market research firm Real Capital Analytics. These range from the very large—last month’s $193 million acquisition by CBRE of the Resort at Pembroke Pines in Hollywood, Fla., drew a 6 percent cap—to smaller assets, such as the $25.5 million acquisition by Trinity Property Group of the 76-unit Clay Park Towers in San Francisco, which had a 5 percent cap rate.
While some of today’s cap rates seem aggressive, when you factor in the price of debt from Fannie and Freddie—around 4 percent for a 10-year loan, and sub-4 percent for a seven-year loan—it makes sense. “If you’re buying a quality property in a core market with a going-in cap rate around 6 percent, and you’re getting 75 percent leverage at 4 percent, you’re getting huge positive leverage,” says David Rifkind, principal and managing director of Los Angeles-based George Smith Partners. “You’re spitting out cash flow.” Some in the industry are marveling that in the high-barrier coastal markets, there’s been a return to the cap rates seen at the height of the last boom period. But one notable difference is that cap rate compression is only really seen on the upper echelon of deals in select markets. “I think we’ll continue to see the cap rate differentiation that we hadn’t seen four or five years ago,” says Michael Berman, president and CEO of Needham, Mass.-based CWCapital. “We’re seeing cap rates of 4 percent for really fine, triple A properties, but B and C properties aren’t seeing that kind of compression.”
The high-barrier coastal markets have experienced the biggest cap rate declines. But some believe that the dynamic will soon begin to emerge in the Midwest as well. “On the coasts, it’s always a little bit of an anomaly. In the Midwest, we’re not seeing a lot of transactions of stabilized, well-occupied properties yet,” says Greg Cazel, executive vice president of Midwest markets for Boise, Idaho-based lender A10 Capital. “But as we continue to see leasing and occupancy strengthen like we’ve seen for the past 18 months, I think cap rates are going to continue to come down.” Everyone knows, however, that today’s interest-rates can’t last, and that it’s impossible to time the bottom. The economy will enter into an inflationary period sooner or later. “Based on the federal deficit and the capacity of the economy, at some point we’re going to be back in an inflationary period,” says Berman. “And when that happens, cap rates will drift up again.” But for now, interest rates continue to fall and the pace of transactions continues to rise. The fourth quarter is shaping up to be the kind of “busy season” that we haven’t seen in a few years. Carpe Diem.
Wednesday
120 Unit Motel sold in Myrtle Beach
A 120-room "Value Place" property in Myrtle Beach, South Carolina sold to Deesha Hotels for an undisclosed sum. The hotel is well-located directly off Highway 501, approximately seven miles from the Myrtle Beach International Airport and is proximate to many lifestyle amenities including high quality shopping, entertainment and restaurants including Myrtle Beach downtown, Freestyle Music Park, Broadway at the Beach and golf courses.
North Myrtle Beach channels in midst of legal battle
North Myrtle Beach officials will be heading back to court in November over ownership of the channels in Cherry Grove after a mistrial in September on the issue. City officials and East Cherry Grove Realty - which claims ownership of the channels in Cherry Grove - went to court in September after both parties were unable to reach a resolution regarding the property issue. Horry County Circuit Court Judge Larry Hyman denied the city's request earlier this year to dismiss East Cherry Grove Realty's claim. The city has been working to dredge the channels in Cherry Grove since 2004, but ongoing legal battles over marshland ownership have prevented the work. The city contends that the state owns the channels. The case was tried in court over four days in September. After two hours of deliberation, one juror said she felt she could not be a fair juror to the state and was dismissed by the judge, according to North Myrtle Beach City Attorney Chris Noury and Gene Connell, a Surfside Beach attorney representing East Cherry Grove Realty.
Noury said the city was willing to move forward with 11 jurors, but Connell said his client felt strongly that 12 people should decide the case. The case will be back before a judge on Nov.15, Noury and Connell said. "We want the court to see the channels are owned by East Cherry Grove Realty," said Connell, who said the group - heirs of C.D. Nixon, who built the canals - has owned the channels since the early 1960s. "You can't condemn our property and do anything to it without our consent," Connell said, regarding the dredging work. The city says the state owns those lands and a local government cannot condemn lands owned by the state. Last year, North Myrtle Beach received a state Department of Health and Environmental Control permit for the nearly $4.2 million dredging project, but it will not be issued a second required permit from the U.S. Army Corps of Engineers until East Cherry Grove Realty's claim of ownership of the channels is settled, city officials said. An assessment district also cannot be established until the property issues are resolved. Connell said the issue was settled in 1969 when the judge at the time ruled that East Cherry Grove Realty owned the marshland under a king's grant. "It's a question of documentation interpretation," Connell said about his client and city officials going to court over the issue. A recent survey shows sediment has increased in the channels from 4 inches to 15 inches in the past five years.
Over time, the canals could become impassable if nothing is done, city officials said. The City Council passed a resolution during its meeting Monday in support of the project. "The city will continue to pursue through all possible means on public behalf the dredging of the Cherry Grove channels so that the full use of the channels might be reinstated and perpetually preserved for the public use and enjoyment by the city's residents and visitors," a portion of the resolution stated. The dredging work planned in the project would affect about 600 property owners, officials have said. Some channels are excluded from the current dredging permit, and Noury said the city "feels those channels omitted should be included." "We're working with DHEC staff to determine which method will be best - applying for a new permit [for them] or amending the current permit [to include them]," Noury said.
Noury said the city was willing to move forward with 11 jurors, but Connell said his client felt strongly that 12 people should decide the case. The case will be back before a judge on Nov.15, Noury and Connell said. "We want the court to see the channels are owned by East Cherry Grove Realty," said Connell, who said the group - heirs of C.D. Nixon, who built the canals - has owned the channels since the early 1960s. "You can't condemn our property and do anything to it without our consent," Connell said, regarding the dredging work. The city says the state owns those lands and a local government cannot condemn lands owned by the state. Last year, North Myrtle Beach received a state Department of Health and Environmental Control permit for the nearly $4.2 million dredging project, but it will not be issued a second required permit from the U.S. Army Corps of Engineers until East Cherry Grove Realty's claim of ownership of the channels is settled, city officials said. An assessment district also cannot be established until the property issues are resolved. Connell said the issue was settled in 1969 when the judge at the time ruled that East Cherry Grove Realty owned the marshland under a king's grant. "It's a question of documentation interpretation," Connell said about his client and city officials going to court over the issue. A recent survey shows sediment has increased in the channels from 4 inches to 15 inches in the past five years.
Over time, the canals could become impassable if nothing is done, city officials said. The City Council passed a resolution during its meeting Monday in support of the project. "The city will continue to pursue through all possible means on public behalf the dredging of the Cherry Grove channels so that the full use of the channels might be reinstated and perpetually preserved for the public use and enjoyment by the city's residents and visitors," a portion of the resolution stated. The dredging work planned in the project would affect about 600 property owners, officials have said. Some channels are excluded from the current dredging permit, and Noury said the city "feels those channels omitted should be included." "We're working with DHEC staff to determine which method will be best - applying for a new permit [for them] or amending the current permit [to include them]," Noury said.
Thursday
Hotel makes way for Ferris wheel in Myrtle Beach
Sun News - Crews have started clearing out the two-tower Golden Villa hotel in downtown Myrtle Beach, which will be demolished next week, to make way for a new Ferris wheel. Al Mers, a partner in Pacific Development, the St. Louis-based company that's bringing the 187-foot-tall SkyWheel to downtown Myrtle Beach, said work is moving ahead as crews remove asbestos from the hotel in preparation for its demolition. The Golden Villa has stood in downtown Myrtle Beach for many years, becoming a regular vacation spot for families returning to the Grand Strand. On some travel websites, vacationers have written comments asking that the hotel not close, offering their fond memories of staying there as children or with their own children. "There's something to be said for the older places remaining, but it's also in themiddle of the entertainment district," said Myrtle Beach City Councilman Randal Wallace. "This is an opportunity to bring a fun, new attraction to downtown." The demolition is scheduled to begin Monday or Tuesday, and Mers said the lot at 1106 N. Ocean Blvd. should be flat by about Oct. 22.
"The first thing people will see going up are the piers," he said. Because the wheel and the adjoining building are being built in the hurricane surge zone, they must be constructed on a deck that will sit 20 feet above sea level - 3 to 4 feet above the ground on the lot. Piers to hold the wheel's steel frame will sink 30 feet deep, Mers said. Pacific Development plans to place a camera atop the Slingshot, a thrill ride across the street, to shoot time-lapse photos of the hotel demolition and the wheel complex's construction to produce a 12-minute video that will show people the process. The wheel is part of the ever-changing face of downtown Myrtle Beach. Wallace said he remembers the 1970s when downtown's then-tallest feature, the Astro Needle, was in operation. It was a 200-foot attraction at the corner of Eighth Avenue North and Chester Street - an intersection that doesn't even exist anymore.
"When I was a little kid, it was really a neat ride. I was so small, and it seemed huge," Wallace said. "You got in this UFO-like car and it took you up to the top and spun you around, and then brought you back down." But the needle, which opened in 1970, was removed after Burroughs & Chapin Co. Inc. bought the site and expanded The Myrtle Beach Pavilion Amusement Park to Kings Highway. Wallace said he's looking forward to the new SkyWheel and the views people will have from the gondolas. When the SkyWheel is finished, it will be one of the downtown district's tallest structures. The height limit is 240 feet, and there are nine resort towers that are between 20 and 23 stories, said Fire Marshal Bruce Arnell, including the Ocean Forest Plaza, the Carolina Grand and the Grand Atlantic. The Slingshot frame is about 170 feet tall and stands on a small hill, and when the SkyWheel is finished, it should be about 200 feet tall.
The wheel is scheduled to open in the first week of May. "It's like putting a puzzle together," said Pacific Development partner Todd Schneider. The steel frame is being constructed in pieces outside St. Louis, and the "ballooned-out-square" gondolas that will carry riders are being crafted in Switzerland, Mers said. "They are like what you'd see on a ski lift," he said. "They are the latest upgrade - the fourth generation." Each gondola is temperature controlled, and because they are clear from floor to ceiling, each will have a slight tint to help keep it cool in the summer and make scenery watching more comfortable. Once the lot is cleared and prepared, about "50 truck loads" of steel will arrive and be stored in Myrtle Beach, delivered to the site as needed. Mers said the A-frame could be here by December. Mers said the project, while not that big by construction standards, is creating local jobs. Rhino Demolition-Environmental from Little River is removing the asbestos, and Thompkins & Associates heavy construction company will demolish the hotel. As that work goes on, Mers said, other details must be finalized, including what size motors to use for heating and cooling. Pacific Development has one more meeting with the Myrtle Beach Community Appearance Board, likely later this month, and all the pre-construction requirements will be filled, Mers said. "So far, everyone has liked the design," he said. "But we can't finish the plans until all those little details are settled."
"The first thing people will see going up are the piers," he said. Because the wheel and the adjoining building are being built in the hurricane surge zone, they must be constructed on a deck that will sit 20 feet above sea level - 3 to 4 feet above the ground on the lot. Piers to hold the wheel's steel frame will sink 30 feet deep, Mers said. Pacific Development plans to place a camera atop the Slingshot, a thrill ride across the street, to shoot time-lapse photos of the hotel demolition and the wheel complex's construction to produce a 12-minute video that will show people the process. The wheel is part of the ever-changing face of downtown Myrtle Beach. Wallace said he remembers the 1970s when downtown's then-tallest feature, the Astro Needle, was in operation. It was a 200-foot attraction at the corner of Eighth Avenue North and Chester Street - an intersection that doesn't even exist anymore.
"When I was a little kid, it was really a neat ride. I was so small, and it seemed huge," Wallace said. "You got in this UFO-like car and it took you up to the top and spun you around, and then brought you back down." But the needle, which opened in 1970, was removed after Burroughs & Chapin Co. Inc. bought the site and expanded The Myrtle Beach Pavilion Amusement Park to Kings Highway. Wallace said he's looking forward to the new SkyWheel and the views people will have from the gondolas. When the SkyWheel is finished, it will be one of the downtown district's tallest structures. The height limit is 240 feet, and there are nine resort towers that are between 20 and 23 stories, said Fire Marshal Bruce Arnell, including the Ocean Forest Plaza, the Carolina Grand and the Grand Atlantic. The Slingshot frame is about 170 feet tall and stands on a small hill, and when the SkyWheel is finished, it should be about 200 feet tall.
The wheel is scheduled to open in the first week of May. "It's like putting a puzzle together," said Pacific Development partner Todd Schneider. The steel frame is being constructed in pieces outside St. Louis, and the "ballooned-out-square" gondolas that will carry riders are being crafted in Switzerland, Mers said. "They are like what you'd see on a ski lift," he said. "They are the latest upgrade - the fourth generation." Each gondola is temperature controlled, and because they are clear from floor to ceiling, each will have a slight tint to help keep it cool in the summer and make scenery watching more comfortable. Once the lot is cleared and prepared, about "50 truck loads" of steel will arrive and be stored in Myrtle Beach, delivered to the site as needed. Mers said the A-frame could be here by December. Mers said the project, while not that big by construction standards, is creating local jobs. Rhino Demolition-Environmental from Little River is removing the asbestos, and Thompkins & Associates heavy construction company will demolish the hotel. As that work goes on, Mers said, other details must be finalized, including what size motors to use for heating and cooling. Pacific Development has one more meeting with the Myrtle Beach Community Appearance Board, likely later this month, and all the pre-construction requirements will be filled, Mers said. "So far, everyone has liked the design," he said. "But we can't finish the plans until all those little details are settled."
Tuesday
Bank Watch: Regulator Says Bankers, Not Bricks, Main Reason Behind Most Bank Failures
CoStar - Don't blame the current wave of bank failures on commercial real estate; much of the blame belongs to bad bankers. While it is clear that commercial real estate and construction and land development loans have figured in most every bank failure in the last couple of years, it is also becoming evident that bad bank management and, in some cases, outright deceit, were at the core of many of the banks' problems. In addition, more regulatory supervision may have mitigated some of those problems, according federal bank failure audits. The Federal Deposit Insurance Act requires the Federal Deposit Insurance Corp.'s (FDIC) Office of Inspector General (OIG) to conduct a material loss review of individual bank failures. A review of the seven material loss reviews completed and released this summer by the OIG show common themes.
Many failed banks' boards and managers did not implement adequate controls to identify, measure, monitor and control the risks associated with significant and growing CRE loan concentrations; Many failed banks exhibited weak internal controls and questionable credit underwriting standards; and They financed growth in lending through potentially volatile non-core liabilities such as higher-priced certificates of deposit, including brokered deposits. In the seven audits, the OIG also pinpointed instances of insufficient federal oversight. In general, the audits suggested that the FDIC, while good at following required supervisory procedure, could have done more. For example the audits suggested the FDIC should have: Placed greater supervisory emphasis on more forward-looking assessments; Taken a more aggressive supervisory approach where risky loan concentrations were growing rapidly; Issued more critical assessments when banks were not adhering to original business plans; and Taken further steps to ensure that management and internal controls were commensurate with the business strategy.
Many failed banks' boards and managers did not implement adequate controls to identify, measure, monitor and control the risks associated with significant and growing CRE loan concentrations; Many failed banks exhibited weak internal controls and questionable credit underwriting standards; and They financed growth in lending through potentially volatile non-core liabilities such as higher-priced certificates of deposit, including brokered deposits. In the seven audits, the OIG also pinpointed instances of insufficient federal oversight. In general, the audits suggested that the FDIC, while good at following required supervisory procedure, could have done more. For example the audits suggested the FDIC should have: Placed greater supervisory emphasis on more forward-looking assessments; Taken a more aggressive supervisory approach where risky loan concentrations were growing rapidly; Issued more critical assessments when banks were not adhering to original business plans; and Taken further steps to ensure that management and internal controls were commensurate with the business strategy.
US Banks Report CRE Loan Troubles Subsiding Amid Strong Quarterly Earnings
CoStar - It appears that commercial real estate adversity at U.S. banks has reached the high-water mark and is abating. According to the Federal Deposit Insurance Corp. (FDIC), second quarter numbers show 90-plus day delinquencies leveling and eventually set to decline because 30-89 day delinquencies are declining. Also, net charge-offs are leveling or declining. The only CRE distress levels still rising at banks is the amount of foreclosed assets, the total of which now stands at $29.77 billion, up from $7.4 billion two years ago.
Also, the banking industry's quarterly earnings of $21.6 billion are up dramatically from the year-ago loss of $4.4 billion and represent the highest quarterly earnings since third quarter 2007. Almost two out of three institutions (65.5%) reported higher year-over-year quarterly net income. And while the proportion of institutions reporting quarterly net losses remained high at 20%, it was down from more than 29% a year earlier. "This is the best quarterly profit for the banking sector in almost three years," said FDIC chairman Sheila C. Bair. "Nearly two out of every three banks are reporting better year-over-year earnings. As long as economic conditions remain supportive, most institutions should maintain profitability and increase their capacity to lend."
Reductions in loan-loss provisions underscored improvement in asset quality indicators during second quarter 2010. Insured institutions added $40.3 billion in provisions to their loan-loss allowances in the second quarter. While still high by historic standards, this is the smallest total since the industry set aside $37.2 billion in first quarter 2008 and is $27.1 billion (40.2%) less than the industry's provisions in second quarter 2009. Fewer than half of all institutions (41.3%) reported year-over-year reductions in quarterly loss provisions. Only 40% of community banks (institutions with less than $1 billion in assets) reported year-over-year declines. Reductions were more prevalent among larger institutions. More than half (56.2%) of institutions with assets greater than $1 billion had lower provisions in the second quarter. The amount of loans and leases that were noncurrent (90 days or more past due or in nonaccrual status) declined by $19.6 billion (4.8%) during the second quarter. This is the first quarterly decline in noncurrent loans since first quarter 2006. Noncurrent levels declined in most major loan categories during the quarter. The sole exception was nonfarm nonresidential real estate loans, where noncurrents increased by $547 million (1.2%). However, that was the smallest quarterly increase in three years. The largest reduction in noncurrent loans in the quarter occurred in real estate construction and development loans, where noncurrents fell by $5.9 billion (8.3%). This is the third consecutive quarter that noncurrent C&D loans have declined. Multifamily delinquencies also declined.
Total loan-loss reserves of insured institutions fell for the first time since fourth quarter 2006, declining by $11.8 billion (4.5%), as net charge-offs of $49 billion exceeded loss provisions of $40.3 billion. The number of institutions on the FDIC's "Problem List" rose from 775 to 829. However, the total assets of "problem" institutions declined from $431 billion to $403 billion. Also, while the number of "problem" institutions is the highest since March 31, 1993, when there were 928, it is the smallest net increase since the first quarter of 2009. Forty-five insured institutions with combined assets of $47.3 billion failed during second quarter 2010. For 2010 through the end of the second quarter, 86 insured institutions with combined assets of $69.4 billion failed, resulting in an estimated current cost to the DIF of $16.8 billion. "Without question, the industry still faces challenges. Earnings remain low by historical standards, and the numbers of unprofitable institutions, problem banks and failures remain high," FDIC chairman Bair added. "But the banking sector is gaining strength. Earnings have grown, and most asset quality indicators are moving in the right direction."
The U.S. thrift industry also reported a profit in the second quarter ($1.49 billion), the fourth consecutive quarterly profit for the industry. "The thrift industry has clearly improved from the height of the recession but has certainly not recovered in full," noted OTS acting director John E. Bowman. "The performance of the industry reflects the state of the overall economy and the stresses from high unemployment, weakness in the housing market and the spread of weakness to the commercial real estate market."
Also, the banking industry's quarterly earnings of $21.6 billion are up dramatically from the year-ago loss of $4.4 billion and represent the highest quarterly earnings since third quarter 2007. Almost two out of three institutions (65.5%) reported higher year-over-year quarterly net income. And while the proportion of institutions reporting quarterly net losses remained high at 20%, it was down from more than 29% a year earlier. "This is the best quarterly profit for the banking sector in almost three years," said FDIC chairman Sheila C. Bair. "Nearly two out of every three banks are reporting better year-over-year earnings. As long as economic conditions remain supportive, most institutions should maintain profitability and increase their capacity to lend."
Reductions in loan-loss provisions underscored improvement in asset quality indicators during second quarter 2010. Insured institutions added $40.3 billion in provisions to their loan-loss allowances in the second quarter. While still high by historic standards, this is the smallest total since the industry set aside $37.2 billion in first quarter 2008 and is $27.1 billion (40.2%) less than the industry's provisions in second quarter 2009. Fewer than half of all institutions (41.3%) reported year-over-year reductions in quarterly loss provisions. Only 40% of community banks (institutions with less than $1 billion in assets) reported year-over-year declines. Reductions were more prevalent among larger institutions. More than half (56.2%) of institutions with assets greater than $1 billion had lower provisions in the second quarter. The amount of loans and leases that were noncurrent (90 days or more past due or in nonaccrual status) declined by $19.6 billion (4.8%) during the second quarter. This is the first quarterly decline in noncurrent loans since first quarter 2006. Noncurrent levels declined in most major loan categories during the quarter. The sole exception was nonfarm nonresidential real estate loans, where noncurrents increased by $547 million (1.2%). However, that was the smallest quarterly increase in three years. The largest reduction in noncurrent loans in the quarter occurred in real estate construction and development loans, where noncurrents fell by $5.9 billion (8.3%). This is the third consecutive quarter that noncurrent C&D loans have declined. Multifamily delinquencies also declined.
Total loan-loss reserves of insured institutions fell for the first time since fourth quarter 2006, declining by $11.8 billion (4.5%), as net charge-offs of $49 billion exceeded loss provisions of $40.3 billion. The number of institutions on the FDIC's "Problem List" rose from 775 to 829. However, the total assets of "problem" institutions declined from $431 billion to $403 billion. Also, while the number of "problem" institutions is the highest since March 31, 1993, when there were 928, it is the smallest net increase since the first quarter of 2009. Forty-five insured institutions with combined assets of $47.3 billion failed during second quarter 2010. For 2010 through the end of the second quarter, 86 insured institutions with combined assets of $69.4 billion failed, resulting in an estimated current cost to the DIF of $16.8 billion. "Without question, the industry still faces challenges. Earnings remain low by historical standards, and the numbers of unprofitable institutions, problem banks and failures remain high," FDIC chairman Bair added. "But the banking sector is gaining strength. Earnings have grown, and most asset quality indicators are moving in the right direction."
The U.S. thrift industry also reported a profit in the second quarter ($1.49 billion), the fourth consecutive quarterly profit for the industry. "The thrift industry has clearly improved from the height of the recession but has certainly not recovered in full," noted OTS acting director John E. Bowman. "The performance of the industry reflects the state of the overall economy and the stresses from high unemployment, weakness in the housing market and the spread of weakness to the commercial real estate market."
Plans OK'd for Brunswick County housing development - Despite traffic concerns, South Cape project gets a thumbs up
Star News - A new gated community off N.C. 133 earned the approval of the Brunswick County Planning Board Monday evening. It's a major development at a time when the economy has greatly slowed construction projects in the area. It's also connected to a company that has ongoing legal issues with its yet-to-be-completed subdivisions elsewhere in the county – and it lies right in the path of the proposed Cape Fear Skyway. The development, known as South Cape, is slated to contain 290 single-family homes, 144 multi-family units and 81 townhomes, according to documents filed with the county. It would include about 400 acres on either side of N.C. 133 near Mallory Creek. After an extensive presentation, several board members raised concerns about the effect a new development would have on N.C. 133, which they described as already stressed. The board also discussed at length whether the development's streets should be made to connect with future surrounding neighborhoods. But the only additional requirement applied before approval was that an archaeological survey be conducted on the area before land is cleared. The property, which abuts the Cape Fear River, is owned by BLT Trust, with William E. Saunders Jr., as trustee. The trust is an affiliate of The Coastal Companies, an umbrella unit for several subdivisions in Brunswick County in different stages of completion. Its CEO is Mark Saunders, the son of William Saunders, TCC attorney Elaine Jordan said.
Myrtle Beach National takes over Pawleys Plantation
Sun News - Myrtle Beach National Co. has acquired Pawleys Plantation, giving the largest golf course management/ownership group on the Grand Strand operation of 14 Strand courses, including three 27-hole facilities. The company also has a marketing arrangement with the TPC of Myrtle Beach. Jim Woodring, vice president of golf operations and marketing for Myrtle Beach National, predicts the company will stand pat with its holdings for a while. The second largest course management company on the Strand, Burroughs & Chapin Co., owns and/or manages 10 of the Strand's approximately 100 courses. "This is a good number," Woodring said. "We're very comfortable for the time being. We have plenty on our plate right now."
Pawleys Plantation opened in 1988 and is a challenging Jack Nicklaus-designed layout with Lowcountry features including tidal marsh and large live oak trees. Myrtle Beach National acquired Pawleys Plantation from original owner Les Morris. It had a contract to purchase the course this past spring and was finally able to finalize the details. The acquisition also includes all the resort amenities and real estate contained on the property. Myrtle Beach National will maintain the property's dining and convention facilities including three restaurants and more than 10,000 square feet of meeting space highlighted by the Plantation Ballroom. The company will also serve as rental manager for the more than 100 villas at Pawleys Plantation. The Pawleys Plantation course has been rated among the top 25 courses in South Carolina by Golf Magazine, Golf World and the South Carolina Golf Course Ratings Panel. Pawleys Plantation is also home to the Ritson-Sole Golf School, rated by Golf Magazine in 2008 as one of the Top 25 Golf Schools in America.
Pawleys Plantation has also been judged as one of the top meeting facilities in the Southeast by ConventionSouth magazine. "It's such a great fit with the other courses we have down there for package programs," Woodring said. "Arguably it's one of the prettiest courses in the area and it gives us both Jack Nicklaus courses in the area, along with Long Bay Club on the north end." Myrtle Beach National also owns and operates three courses at Myrtle Beach National Golf Club, Aberdeen Country Club, Waterway Hills Golf Club, Long Bay Club, Litchfield Country Club, River Club and Willbrook Plantation. The company has management contracts with Blackmoor Golf Club, Wachesaw Plantation East, Wild Wing Plantation and Tradition Club.
Pawleys Plantation opened in 1988 and is a challenging Jack Nicklaus-designed layout with Lowcountry features including tidal marsh and large live oak trees. Myrtle Beach National acquired Pawleys Plantation from original owner Les Morris. It had a contract to purchase the course this past spring and was finally able to finalize the details. The acquisition also includes all the resort amenities and real estate contained on the property. Myrtle Beach National will maintain the property's dining and convention facilities including three restaurants and more than 10,000 square feet of meeting space highlighted by the Plantation Ballroom. The company will also serve as rental manager for the more than 100 villas at Pawleys Plantation. The Pawleys Plantation course has been rated among the top 25 courses in South Carolina by Golf Magazine, Golf World and the South Carolina Golf Course Ratings Panel. Pawleys Plantation is also home to the Ritson-Sole Golf School, rated by Golf Magazine in 2008 as one of the Top 25 Golf Schools in America.
Pawleys Plantation has also been judged as one of the top meeting facilities in the Southeast by ConventionSouth magazine. "It's such a great fit with the other courses we have down there for package programs," Woodring said. "Arguably it's one of the prettiest courses in the area and it gives us both Jack Nicklaus courses in the area, along with Long Bay Club on the north end." Myrtle Beach National also owns and operates three courses at Myrtle Beach National Golf Club, Aberdeen Country Club, Waterway Hills Golf Club, Long Bay Club, Litchfield Country Club, River Club and Willbrook Plantation. The company has management contracts with Blackmoor Golf Club, Wachesaw Plantation East, Wild Wing Plantation and Tradition Club.
New Bank Under Construction
Sun News - Bank of America has started building a branch at the corner of Pine Island Road and Seaboard Street in Myrtle Beach. The 4,452-square-foot bank will have a drive-through ATM, according to paperwork submitted to the city of Myrtle Beach. The location is being built because Bank of America identified a need in the area, a bank spokeswoman said when the new branch was approved several months ago. "We actively manage our retail distribution network to meet evolving customer demand," she said at that time.
Freestyle Music Park board resigns following foreclosure
Sun News - The majority of Freestyle Music Park's board of directors have stepped down in the wake of a foreclosure suit against the park, former president Steve Baker said in an interview today. A single member, appointed by the park's Russian investors, stayed on the board and continues to try to sell the park, said Baker, who also resigned. All other members of FPI MB Entertainment LLC, the park's owner, resigned after the park's mortgage holder, FPI US LLC, filed a foreclosure suit on Aug. 5, he said. Baker said he could not confirm the identity of the remaining board member with FPI MBE. The future of the park looks grim, Baker said. "I don’t think its dead…but I’m not real optimistic because I don’t think there’s anyone close to buying it," he said. Attorneys Nate Fata, representing FPI MBE, and David Slough, representing FPI US, could not be reached Tuesday afternoon.
The park failed twice in two years after lackluster seasons: First as Hard Rock Park in 2008, then as Freestyle in 2009. The park did not reopen for a 2010 season. The resignations leave Russian investors on both sides of the foreclosure suit. The mortgage holder, FPI US LLC, is a US division of MT Development, a Russian developer. FPI US formed a joint venture with MB Entertainment LLC to start the park under the name FPI MB Entertainment LLC, according to court documents, and appointed its own representative to the resulting company's board. FPI MBE responded to the foreclosure suit Friday, admitting most of the claims against it, according to court documents. FPI MBE affirmed that it owes nearly $25 million on the park, is in default on its loans and is unable to pay the outstanding amount. "They're pretty much admitting a debt is owed and they're pretty much admitting there’s a mortgage and there’s going to be a foreclosure," said Joseph Wachter, an attorney not affiliated with either party.
The response said that FPI MBE should not be responsible for its debt beyond what can be repaid if the property is auctioned off. That's the only claim FPI MBE denied outright with minor claims being denied due to lack of sufficient information, Wachter said. The response indicates a change in the legal approach for FPI MB Entertainment LLC, the park's owner, which has sporadically responded to lawsuits. Local and federal courts have issued at least eight rulings against FPI MB for failure to respond to lawsuits. Baker and the board had been working to find a new buyer for the park prior to their resignations, he said. The foreclosure suit puts additional urgency on the park to find new investors and will make it more difficult to sell, he said. "The Myrtle Beach market can support a park, and I think that market can be attractive," Baker said. "But I think time is not on the investors' side."
The park failed twice in two years after lackluster seasons: First as Hard Rock Park in 2008, then as Freestyle in 2009. The park did not reopen for a 2010 season. The resignations leave Russian investors on both sides of the foreclosure suit. The mortgage holder, FPI US LLC, is a US division of MT Development, a Russian developer. FPI US formed a joint venture with MB Entertainment LLC to start the park under the name FPI MB Entertainment LLC, according to court documents, and appointed its own representative to the resulting company's board. FPI MBE responded to the foreclosure suit Friday, admitting most of the claims against it, according to court documents. FPI MBE affirmed that it owes nearly $25 million on the park, is in default on its loans and is unable to pay the outstanding amount. "They're pretty much admitting a debt is owed and they're pretty much admitting there’s a mortgage and there’s going to be a foreclosure," said Joseph Wachter, an attorney not affiliated with either party.
The response said that FPI MBE should not be responsible for its debt beyond what can be repaid if the property is auctioned off. That's the only claim FPI MBE denied outright with minor claims being denied due to lack of sufficient information, Wachter said. The response indicates a change in the legal approach for FPI MB Entertainment LLC, the park's owner, which has sporadically responded to lawsuits. Local and federal courts have issued at least eight rulings against FPI MB for failure to respond to lawsuits. Baker and the board had been working to find a new buyer for the park prior to their resignations, he said. The foreclosure suit puts additional urgency on the park to find new investors and will make it more difficult to sell, he said. "The Myrtle Beach market can support a park, and I think that market can be attractive," Baker said. "But I think time is not on the investors' side."
Construction, sales to start at new Grande Dunes Subdivsion
Sun News - Construction and sales will start in September at Cipriana Park, a new subdivision in Grande Dunes in Myrtle Beach. The subdivision, on Grande Dunes Boulevard between U.S. 17 Bypass and U.S. 17 Business, will have 182 single-family homes when it is completed. Leonard, Grigg & Associates LLC and Traditional Homebuilders of Little River teamed up on the project. The three-bedroom, two-bathroom houses will range in size from about 2,000 square feet to about 3,200 square feet and base prices will range from $270,000 and $390,000. Sales will begin at the development in September and Traditional Homebuilders will build two models, which will be completed by January.
Development near Market Common Defaults
Sun News - More than 200 acres of former Myrtle Beach Air Force Base property near The Market Common is up for sale after the owner failed to make payments and the lender started foreclosure proceedings. The Withers Preserve planned unit development was zoned for commercial and residential uses, and the undeveloped land is now under the jurisdiction of a court-appointed receiver. Barclays Capital Real Estate Inc. filed to foreclose on Myrtle Beach Property Development LLC a few months ago and asked the court to appoint a receiver to take care of the property, according to court documents. Myrtle Beach Property Development owner Robert O'Neel could not be reached for comment Thursday. His company borrowed $50 million from Barclays in 2006. The land is the collateral for the loan, and when the development company failed to make payments Barclays began the foreclosure process. The company owes Barclays about $47.2 million.
Stephen McCrae, a lawyer with K&L Gates in Rock Hill who is representing Barclays, said he couldn't comment on what the lender's plans are for the property but said that the foreclosure action was awaiting referral to the Master-in-Equity. Two parts of the planned development, the Alexan Withers Preserve apartment complex and the strip of commercial properties owned by Tennessee-based real estate development company, Holrob, are not part of the foreclosure. The 12 parcels involved are on both sides of Farrow Parkway near the intersection with U.S. 17 Bypass. "Our role is really to step in. It's a positive move," said Wilson, who has 22 years of experience as a receiver throughout the country. "We're there to preserve the entitlements and take care of the property and maintain the insurance." Wilson said that he is seeing an increase in similar cases across the country and that the foreclosure does not mean it is a bad property. In fact, he said the property has a strong long-term value and there has already been interest from potential buyers. "It's merely a situation reflective of the real estate markets in general," Wilson said. "The transaction is reasonably straightforward. You just have an overbuilt product without a lot of demand today."
Wilson has had to negotiate new insurance policies and ensure the safety of the property. He recently hired Colliers Keenan, a Columbia-based commercial real estate company, to market the property. Another of Wilson's duties has been to negotiate with the South Carolina Department of Transportation, which is trying to buy two pieces of the property. Richard Lovelace, a Conway lawyer, is representing the receivership in court in the sale because a judge has to approve the sale of the property to the SCDOT. "I think they're close to reaching a settlement with the highway department on two parcels," he said. In June the court authorized Wilson to proceed with the sale of the land to SCDOT, according to court documents. O'Neel, the owner of Myrtle Beach Property Development, could not be reached for comment but he had invested heavily throughout the country and many of his projects are now in foreclosure, according to The Press Democrat in Santa Rosa, Calif. "You know, I can look back at all kinds of things and say I never should have done it. But I can't. Those were decisions I made at the time," he said to The Press Democrat.
Buddy Styers, the executive director of the Myrtle Beach Air Force Base Redevelopment Authority, said that the foreclosure could be good for the area. "I hope it's a good thing that they can get something started out there. It would sure benefit Myrtle Beach, Horry County and it would certainly benefit The Market Common to get some more development out there." David Wilkes, the executive vice president of Dock Street Communities, which built much of The Market Common, said the company is watching the foreclosure process. "We would not be not interested in any opportunity that would present itself in that area but are we actively seeking it currently? Not right now," he said. While Dock Street is focused on some residential construction projects, Wilkes said the land would be a great property for someone to buy. Gary Roberts, the broker-in-charge of commercial division of Coldwell Banker Chicora Real Estate, who sold the property to O'Neel years ago said he thinks that plans are great and the area has a lot of potential. "I absolutely believe that there will be a buyer for that," he said.
Stephen McCrae, a lawyer with K&L Gates in Rock Hill who is representing Barclays, said he couldn't comment on what the lender's plans are for the property but said that the foreclosure action was awaiting referral to the Master-in-Equity. Two parts of the planned development, the Alexan Withers Preserve apartment complex and the strip of commercial properties owned by Tennessee-based real estate development company, Holrob, are not part of the foreclosure. The 12 parcels involved are on both sides of Farrow Parkway near the intersection with U.S. 17 Bypass. "Our role is really to step in. It's a positive move," said Wilson, who has 22 years of experience as a receiver throughout the country. "We're there to preserve the entitlements and take care of the property and maintain the insurance." Wilson said that he is seeing an increase in similar cases across the country and that the foreclosure does not mean it is a bad property. In fact, he said the property has a strong long-term value and there has already been interest from potential buyers. "It's merely a situation reflective of the real estate markets in general," Wilson said. "The transaction is reasonably straightforward. You just have an overbuilt product without a lot of demand today."
Wilson has had to negotiate new insurance policies and ensure the safety of the property. He recently hired Colliers Keenan, a Columbia-based commercial real estate company, to market the property. Another of Wilson's duties has been to negotiate with the South Carolina Department of Transportation, which is trying to buy two pieces of the property. Richard Lovelace, a Conway lawyer, is representing the receivership in court in the sale because a judge has to approve the sale of the property to the SCDOT. "I think they're close to reaching a settlement with the highway department on two parcels," he said. In June the court authorized Wilson to proceed with the sale of the land to SCDOT, according to court documents. O'Neel, the owner of Myrtle Beach Property Development, could not be reached for comment but he had invested heavily throughout the country and many of his projects are now in foreclosure, according to The Press Democrat in Santa Rosa, Calif. "You know, I can look back at all kinds of things and say I never should have done it. But I can't. Those were decisions I made at the time," he said to The Press Democrat.
Buddy Styers, the executive director of the Myrtle Beach Air Force Base Redevelopment Authority, said that the foreclosure could be good for the area. "I hope it's a good thing that they can get something started out there. It would sure benefit Myrtle Beach, Horry County and it would certainly benefit The Market Common to get some more development out there." David Wilkes, the executive vice president of Dock Street Communities, which built much of The Market Common, said the company is watching the foreclosure process. "We would not be not interested in any opportunity that would present itself in that area but are we actively seeking it currently? Not right now," he said. While Dock Street is focused on some residential construction projects, Wilkes said the land would be a great property for someone to buy. Gary Roberts, the broker-in-charge of commercial division of Coldwell Banker Chicora Real Estate, who sold the property to O'Neel years ago said he thinks that plans are great and the area has a lot of potential. "I absolutely believe that there will be a buyer for that," he said.
Utility Authority projects could cost hundreds of millions
The Cape Fear Public Utility Authority will soon have a new plan on what it will build, fix and upgrade during the next decade – and what customers will pay to make it reality. The authority board on Wednesday will begin formulating a new 10-year capitol improvement schedule, an ever-evolving map on how authority leaders will spend money to repair aging infrastructure, promote growth and development and bring water and sewer to unserved parts of the county. The list of projects won't be cheap – the total price tag will likely be in the range of hundreds of millions of dollars and mainly paid for with bonds that will require rate increases to pay for.
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Job opportunities coming with new convention center
Star News- Wilmington's new convention center will need contractors for a wide range of tourism and technical jobs, and businesses that are local or certified as small or minority-owned could stand out among others seeking those positions.At a forum hosted Thursday night by the city of Wilmington and an urban planning contractor, local business representatives learned about opportunities for contract jobs and criteria required of them to be selected as a contractor with the Wilmington Convention Center. The city has a policy to encourage the inclusion of women, minorities and small businesses in doing business with the city, said Ken Weeden of Ken Weeden & Associates, a consulting firm contracted by the city to plan Thursday night's forum. Weeden told the forum's attendees that the city will require small or minority-owned businesses seeking contractor positions to have a Disadvantaged Business Enterprise certification, which means the state has recognized the business as being small and independent with at least 51 percent of the business owned by one or more socially or economically disadvantaged individuals. Certifications are issued by the N.C. Department of Transportation or the N.C. Department of Administration.
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Myrtle Beach airport sees record traffic
Sun News - More people flew into and out of Myrtle Beach International Airport in July than ever before, breaking the 100,000 passenger mark, according to airport numbers released Monday. More than 111,000 passengers boarded outbound planes and more than 117,000 passengers arrived in Myrtle Beach in July, breaking records set in July 2005 and beating peak months in 2007 before the economic downturn began. Additional markets and direct routes to places like Atlanta, Pittsburgh and Chicago added in recent months have bolstered passenger demand. Direct marketing in those new destinations also helped bring more people to the area to spend tourism dollars, according to airport and tourism officials.
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Wednesday
Port of Wilmington gets focus with International Terminal project on hold
With the N.C. International Terminal project on hold and its future in question, N.C. State Ports Authority officials say they will turn their focus to existing ports in Wilmington and Morehead City. At the Port of Wilmington, there is momentum to build from – at least in the shipping container business. For the fiscal year that ended June 30, container volumes increased 29 percent from the year before, from 194,600 TEUs in 2008-09 to 249,850 TEUs in the latest fiscal year, according to Ports Authority statistics. A 20-foot equivalent unit, or TEU, is a measure used for capacity in container transportation.
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Work starts on Expansion of 38th Ave. North in Myrtle Beach
Sun News - Work has started to widen 38th Avenue North in Myrtle Beach, but it will still be weeks before drivers experience traffic delays. "There's a lot of preparation that goes into a project like this," said Public Works Director Bill Oliver of the 270-day job. Between now and the end of April, crews will transform a half-mile segment of 38th Avenue North between U.S. 17 Bypass and just east of Robert M. Grissom Parkway. When the work is completed, the now-two-lane road will be five lanes with a center turn lane, sidewalks, gutters, bike lanes and a new traffic signal at 38th and Oleander.
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Thursday
75,000 Sq. Ft. Office Building in Myrtle Beach SOLD
Core Commercial - The Pinnacle Group has just sold a 4-story, 75,000 square foot office building known as Founders Centre I located in Myrtle Beach, SC. The office building was acquired by a group of investors. The Founders Centre I is situated on approximately 8 acres in the heart of Myrtle Beach’s financial and business district within walking distance to several major banks as well as the Myrtle Beach Convention Center. The building's tenant mix is anchored by the National Bank of South Carolina. For more information, please visit our website at http://www.myrtlebeachcommercialrealestate.com/.
Wednesday
Industrial Sector Lags Despite Manufacturing Gains
NREI - Widespread improvement in the industrial sector won’t occur until 2011 and 2012 despite recent economic and manufacturing gains. That is according to a new report issued by Encino, Calif.-based Marcus & Millichap Real Estate Investment Services. While the manufacturing sector grew for the tenth consecutive month in May on the strength of new orders and production, industrial vacancies will remain elevated throughout 2010 as tenants have more space than they need. However, some industrial markets like Houston, a port city, are better positioned to rebound faster as tenant demand rises and greater employment growth is expected.
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Myrtle Beach boardwalk ranked third in nation
The Myrtle Beach boardwalk came in third on National Geographic's top 10 list of the nation's boardwalks, the latest in a string of top rankings for the city and the new walkway. The list credits the boardwalk with rehabilitating Myrtle Beach's downtown. Boardwalks across the country stacked up as follows:
1. Atlantic City Boardwalk, N.J.
2. Coney Island Boardwalk, Brooklyn, N.Y.
3. Myrtle Beach
4. Ocean City Boardwalk, Md.
5. Ocean Front Walk, Venice Beach, Calif.
6. Rehoboth Beach Boardwalk, Del.
7. Santa Cruz Beach Boardwalk, Calif.
8. Sandwich Boardwalk, Mass.
9. Virginia Beach Boardwalk, Va.
10. Wildwoods Boardwalk, N.J.
The boardwalk also found the national spotlight last month when NBC's "Today" show featured the walkway in a segment on Travel + Leisure magazine's boardwalks. Add that to Myrtle Beach's ranking in USA Today's Top 5 Affordable Destinations in May, which also prominently featured the boardwalk. The $6 million boardwalk, which opened in May, stretches 1.2 miles.
1. Atlantic City Boardwalk, N.J.
2. Coney Island Boardwalk, Brooklyn, N.Y.
3. Myrtle Beach
4. Ocean City Boardwalk, Md.
5. Ocean Front Walk, Venice Beach, Calif.
6. Rehoboth Beach Boardwalk, Del.
7. Santa Cruz Beach Boardwalk, Calif.
8. Sandwich Boardwalk, Mass.
9. Virginia Beach Boardwalk, Va.
10. Wildwoods Boardwalk, N.J.
The boardwalk also found the national spotlight last month when NBC's "Today" show featured the walkway in a segment on Travel + Leisure magazine's boardwalks. Add that to Myrtle Beach's ranking in USA Today's Top 5 Affordable Destinations in May, which also prominently featured the boardwalk. The $6 million boardwalk, which opened in May, stretches 1.2 miles.
Pace of Hotel Investment Deals Quickens
Co-Star - Investors are demonstrating confidence that the hotel sector is rebounding at midyear, shelling out large sums for marquee properties from Manhattan to Atlanta to San Francisco. Analysts believe the lodging market is entering one of those rare moments of equilibrium where both buyer and seller enjoy opportunities. The uptick in sales is occurring after the hospitality sector, hit by dramatic declines in revenue per available room (RevPAR), saw property sale prices crater like no other commercial property category. But now RevPAR declines are waning and hotel prices are starting to firm up after falling as much as 50% from their 2006-07 peaks. Investors seem intent on taking advantage of bottom-of-the-cycle prices to establish a foothold in the recovering market, although most properties are trading well below replacement costs and historical valuations. Sellers, meanwhile, are cashing in on the dearth of quality product on the market, improved borrowing conditions and the willingness of buyers to accept lower initial yields.
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Monday
Gains creep up quietly in Myrtle Beach area
Sun News - The commercial real estate market improved slightly in the first half of 2010, according to Realtors and experts, but challenges getting financing and a still shaky economic environment will mean a slow path to recovery. While it may not look like it with a significant number of vacant buildings throughout the Grand Strand, the market for office, retail, multifamily and industrial space is improving. Stokes Graves, the president of Core Commercial, said that business is up from last year. While there is too little data to show exactly what the improvements are, the indicators point to a brighter future, he said. "I think last year was definitely a recessionary time," Graves said. "I think we're coming out of the recession and entering a recovery period." Commercial real estate sales are difficult to track because many of the transactions never get posted in the Multiple Listing Service database. The slow improvements on the Grand Strand seem in line with the national trend, which has begun to recover as well.
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S.C. 31's winding path hits new turn in Myrtle Beach area
Sun News - Clearing for the path of the extension of S.C. 31 is moving along, but permit problems could keep drivers off the new road for a few more years. Environmental questions over extending the road 4.2 miles from its existing end point at S.C. 544 farther south to S.C. 707 could hold up the project a number of months beyond what the state Department of Transportation and Horry County officials had hoped. The permit issue arose because the road's existing permit had to be altered. When S.C. 31, also known as Carolina Bays Parkway, received its original permits in 1998, the road was designed to end farther east at U.S. 17 Bypass just north of Holmestown Road.
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Friday
State puts beach development under scrutiny
Sun News - South Carolina's environmental agency is looking to tighten a 22-year-old oceanfront development law that has failed to stop the march of new condo buildings and houses toward the sea - despite a 1988 mandate to limit building on the beach. A special panel, to be appointed by the Department of Health and Environmental Control board, will come up with specific changes for the legislature to consider in 2012. The DHEC board approved forming the panel Thursday at the request of department staff members. The panel would use data from an extensive two-year state study that said South Carolina's effort to limit new seaside development hasn't worked as intended. Any recommendations to toughen the law could affect thousands of seaside property owners and put DHEC on a collision course with development interests.
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North Myrtle Beach unveils study of tourism tax proposal
Sun News - A study released Thursday predicted a proposed 1 percent sales tax for tourism promotion in North Myrtle Beach could generate about $4.5 million in the first year and a possible 3,000 new jobs in the city. The proposed tax also will likely fuel the debate between the North Myrtle Beach Chamber of Commerce and businesses that support the tax, and other businesses and council members who are concerned about its impact on permanent residents. A similar debate became a major issue in last year's municipal elections in Myrtle Beach, which passed a tourism promotion sales tax in 2009. The North Myrtle Beach study, which was requested by the chamber, was conducted by Don Schunk, a research economist at Coastal Carolina University. It looked at the economic impact of tourism on the city and the potential impacts of the sales tax there.
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Plans revived for big Hampstead development
Star News - A proposed Hampstead subdivision's request to change its master plan design will bring the project back before Pender County's planning board Tuesday after a 2½-year delay. The developers of the residential and mixed-use project on 376 acres formerly called St. George's Reach, off County Club Drive, have changed its name to Hawksbill Cove. They will be asking the planning board to approve a revised master plan because they were unable to buy the land to build a connector road along a previously approved route, said Patrick Davenport, the county's director of planning and community development. Besides moving the proposed connector road 700 feet to the south, the new plan calls for the construction of an extension road from Country Club Drive that ties into the existing Transfer Station Road, which intersects U.S. 17. The connector road's relocation would reduce the amount of commercial, office and retail area to 50,000 square feet from the 200,000 square feet initially planned. It also would reduce housing units by 45 to 1,105 units, consisting of 710 single-family homes and 395 multi-family homes.
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Coke distribution center moving from Wilmington to Leland
Star News - Coca-Cola Bottling Co. Consolidated is moving its Wilmington regional distribution center across the river. The Charlotte-based bottler's offices and operations at 921 Princess St. will move later this year to the space that now houses MarKraft Cabinets in the Leland Industrial Park. MarKraft no longer needs the 80,000-square-foot facility and is looking for something smaller. "We are very excited about this new facility in the Wilmington market and believe that it will help us enhance our ability to serve our customers," said Coca-Cola spokesman Lauren Steele. The Brunswick County Economic Development Commission worked with the bottler for several months to make the deal happen.
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Coastal Carolina University OK to buy Quail Creek Golf Course
Sun News - The S.C. Budget and Control Board unanimously approved a measure Wednesday allowing Coastal Carolina University to purchase a Conway golf course that the school previously leased under a controversial agreement. Coastal proposed to buy Quail Creek Golf Course, 107 Citadel Drive, for about $3 million from Chestnut Holding LLC, a West Virginia-based company. CCU has leased the 188-acre course since 2005 as part of its professional golf management program in a deal that could have been extended to 2020 but came under criticism for costing more than if the school purchased the property.
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Tuesday
Margaritaville hotel possible for Myrtle Beach
Myrtle Beach may be getting a Margaritaville Beach Hotel - the latest in Jimmy Buffett's brand endeavors, according to a company spokesman. Margaritaville Management is considering Myrtle Beach as the site for a hotel, said Mike Stommel, a publicist for Margaritaville Management.
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Friday
Ferris wheel gets Myrtle Beach CAB's OK
The Myrtle Beach Community Appearance Board likes the concept of the giant Ferris wheel complex proposed for Ocean Boulevard. At Thursday's meeting, the board gave a conceptual review to the plans for the 5,400-square-foot building that will house a restaurant with a two-story deck, a retail shop, a gift shop and the SkyWheel ticket booth on the two .28-acre lots where the Golden Villas motels now stand at 1106 N. Ocean Blvd. The board doesn't have approval over the wheel itself, because it's an amusement. But it does have to approve the support building and its look.
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Wednesday
Hotel Outlook Improves After Stronger-Than-Expected First Quarter
CoStar - U.S. hotels should enjoy revenue growth the rest of this year, but it probably won't translate to the bottom line until next year, according to new lodging industry reports released this past week. According to Smith Travel Research (STR), lodging demand in the first quarter of 2010 increased 5.3% compared with the first quarter of 2009. This is the largest quarterly increase in hotel demand since the second quarter of 1989. Hotel transaction activity also appears to be thawing, although it still remains a fraction of what it was a couple of years ago, according to Jeff Myers, a real estate economist with CoStar Group, Inc. Through the first four months of the year, hotel sales volume was on pace to surpass 2009's total, and its proportion of overall commercial real estate investment activity has spiked.
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Hotel Appraisals Still Have Clout With Lenders, Survey Shows
NREI - Although hotel lenders always take appraisals with a grain of salt, a newly released survey of capital providers indicates that appraisals are still the biggest factor when determining market pricing for hotel properties — even though many appraisers do not have specific knowledge of the lodging industry.
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Myrtle Beach area real estate finds footing
Sun News - Grand Strand real estate sales rose and prices dropped at a slower rate in May, which Realtors say signals the potential for stability in the market. Single-family home sales increased 25 percent in May from the same month last year, according to data gathered from the Multiple Listing Service. Condominium sales rose 11 percent in May when compared with the same month last year. The median price of single-family homes dropped 5 percent last month when compared with May 2009 and condo prices dropped 1 percent.
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Ferris wheel may roll to Myrtle Beach
Sun News - There could be a big wheel in Myrtle Beach next summer - a really big wheel. If St. Louis-based Pacific Development gets its way, it will build a 175-foot-tall SkyWheel Ferris wheel on the oceanfront just north of Plyler Park. "We're really excited about the thing. It's big enough to be an iconic feature for the city," city manager Tom Leath said. The wheel would be the largest east of the Mississippi in the U.S. and be just like the one on the Canadian side of Niagara Falls, said Downtown Redevelopment Corp. Executive Director David Sebok.
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Tuesday
Community Appearance Board Looks at Grand Dunes Projects
Sun News - The Myrtle Beach Community Appearance Board on Thursday gave the go ahead for one project in Grande Dunes but said a second needed work before it could consider the plans again. The board approved a sales trailer at Cipriana, a planned single-family home development, and it sent the architects of Ocean Tract, a proposed condo development, away with some homework before the next review. Ocean Tract, which is on about 26 acres along the oceanfront between the Dunes Club and Vista Mar, would be built in three phases, with one tower in each phase. The first phase would be a 16-story, 125-unit condo tower. Grande Dunes is an upscale 2,200-acre residential and golf community that stretches from the oceanfront to west of the Intracoastal Waterway.
Read more: http://bit.ly/cXQJ4h
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Monday
Cap Rates Plummeted During First Quarter
Retail Traffic Magazine - An uptick in investment in top retail properties helped send average cap rates for the sector down for the first quarter. Overall, the national cap rate decreased 24 basis points in the first quarter of 2010 to 8.34 percent, according to data from Valuation & Advisory Services. It is the first major decline that the brokerage firm has measured in three years. The data jibes with other reports that indicated an improvement in the investment sales climate driven primarily by transactions on class-A assets. In fact, some analysts have speculated that since the most closings are for the best assets, it is skewing the data a bit. If more deals were closing on class-B or class-C centers, average cap rates would be higher.
The Midwest was the region with the sharpest compression in cap rates. There, cap rates lurched downward by 126 basis points, the largest quarterly move recorded since the first quarter of 2003. “Rate increases seemingly had to stop at some point, and it appears some form of stabilization in the market is at hand,” CBRE wrote in its report. “Average rates are now comparable to Q2/Q3 2009. While it is too early to tell, Q4 2009 may have been the cap rate peak during the current cycle.”
Cap rates also fell sharply in the West—from 8.90 percent to 8.21 percent. Cap rates in the East, however, actually rose slightly from 8.21 percent 8.26 percent. Cap rates also fell in South from 8.83 percent to 8.41 percent.
The data points in CBRE’s results are confirmed closed transactions, adjusted for assumed financing, and are used to reflect overall market trends.
Read More: http://bit.ly/aCKcok
The Midwest was the region with the sharpest compression in cap rates. There, cap rates lurched downward by 126 basis points, the largest quarterly move recorded since the first quarter of 2003. “Rate increases seemingly had to stop at some point, and it appears some form of stabilization in the market is at hand,” CBRE wrote in its report. “Average rates are now comparable to Q2/Q3 2009. While it is too early to tell, Q4 2009 may have been the cap rate peak during the current cycle.”
Cap rates also fell sharply in the West—from 8.90 percent to 8.21 percent. Cap rates in the East, however, actually rose slightly from 8.21 percent 8.26 percent. Cap rates also fell in South from 8.83 percent to 8.41 percent.
The data points in CBRE’s results are confirmed closed transactions, adjusted for assumed financing, and are used to reflect overall market trends.
Read More: http://bit.ly/aCKcok
Myrtle Beach International Airport is ready to grow
Horry County will hold a groundbreaking ceremony for the terminal expansion project at the Myrtle Beach International Airport today, and a project that has taken on several forms in the almost three years it took for final approval of a site plan and design will begin.
Read more: http://bit.ly/b6if7Y
Read more: http://bit.ly/b6if7Y
Wednesday
South Carolina Attracts Substantial Jobs and Investment
Despite the challenging economic environment, the SC Department of Commerce succeeded in producing impressive levels of new job and investment recruitment. South Carolina was #1 in the Southeast for job recruitment in 2009. Click below to view the 2009 Activity Report
http://bit.ly/b5yyfE
http://bit.ly/b5yyfE
Hotel Cap Rates Hold Firm as Investors Change Approach
Loopnet CRE - Hotel capitalization rates are holding comparatively firm as the sector's expected recovery from a deep downturn in operating fundamentals is changing how investors value properties. Hotel investors are more inclined to consider projected performance versus trailing 12-month activity that has been dismal for most properties, according to some of the sector's top brokers and analysts. Investors also are more prone to base bids on the cost to develop a similar property. That has contributed to hotel capitalization rates being kept in check, when compared to rates for other sectors.
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Monday
Scarcity Premium Seen Driving Current Cap Rate Compression
CoStar - Cap rates are a benchmark determined by dividing income by property value. Increasing cap rates typically imply that property values are falling. Last year, no one in commercial real estate doubted that the rapid rise in cap rates reflected an equal rapid decline in property values. However, this year's decreasing cap rates, which would normally imply rising property values, are being viewed with some skepticism over whether they reflect a long-term trend in values, or simply a short term phenomenon.
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Tuesday
Thursday
Tuesday
Tuesday
Friday
Monday
Update on Road Construction Projects for Horry County / Grand Strand
Bridge & Interchange Construction at US Highway 17 Bypass and SC Highway 707 at the Back Gate
Estimated completion is Fall 2013
Aynor Overpass
Estimated completion is Fall 2011
Widening of Glenns Bay Road & Construction of Grade-Separated Interchange at US Highway 17 Bypass
Estimated completion is Spring 2011
3 Bridges and New 6-Lane Road Extending Carolina Bays Parkway from SC Highway 544 to SC Highway 707
Estimated completion is 2013
Widening 3rd Avenue in Myrtle Beach to 3 Lanes
Estimated completion is 2012
Widening SC Highway 707 to 5 Lanes from Enterprise Road to US Highway 17
Estimated completion is 2013
Estimated completion is Fall 2013
Aynor Overpass
Estimated completion is Fall 2011
Widening of Glenns Bay Road & Construction of Grade-Separated Interchange at US Highway 17 Bypass
Estimated completion is Spring 2011
3 Bridges and New 6-Lane Road Extending Carolina Bays Parkway from SC Highway 544 to SC Highway 707
Estimated completion is 2013
Widening 3rd Avenue in Myrtle Beach to 3 Lanes
Estimated completion is 2012
Widening SC Highway 707 to 5 Lanes from Enterprise Road to US Highway 17
Estimated completion is 2013
Thursday
Tuesday
Sunday
Friday
Federal Reserve: Commercial BPOs Do Not Satisfy the Definition of "Evaluation"
Federal Reserve: Commercial BPOs Do Not Satisfy the Definition of "Evaluation"
In response to clarification requests from the Appraisal Institute, the Federal Reserve’s Board of Governors issued a Jan. 14 letter confirming that a broker price opinion “does not satisfy the definition of an appraisal in the Board’s appraisal regulation.”
The Fed’s clarification was addressed to the Appraisal Institute and came in direct response to an Oct. 26, 2009, letter sent to the Fed by the nation’s four largest appraiser organizations that asked the Fed about its policy on the use of BPOs in valuing land and other real property collateralizing commercial loans.
“In response to your question as to the use of BPOs, it is the position of the Federal Reserve staff that a BPO does not satisfy the definition of an appraisal in the Board’s appraisal regulation,” the agency’s letter read. “Therefore, a regulated institution would not be able to utilize a BPO to originate a loan secured by commercial real estate when the loan requires an appraisal in accordance with the appraisal regulation.”
In its letter, the Fed added: “With regard to the use of BPOs as an evaluation, Federal Reserve staff has taken the position that a BPO does not provide sufficient detail on a commercial property’s condition, occupancy, and use to meet the guidelines’ requirements for an evaluation.”
Bill Garber, director of government and external relations of the Appraisal Institute, said: “We applaud the diligent position taken by the staff of the Federal Reserve Board, and we believe it is one that should be taken by all of the federal financial institution regulatory agencies.”
The Appraisal Institute and fellow appraiser organizations had sought clarification after reports that BPOs had been ordered by regulated financial institutions to satisfy the “evaluation” requirements for renewals of commercial loans and refinancing transactions. As the appraiser organizations had pointed out in their October letter, “[C]ommercial BPOs typically lack details on a commercial property’s conditions, occupancy and use as stipulated by the Interagency Guidelines. As such, any use by regulated or supervised institutions would constitute a violation of the Interagency Appraisal and Evaluation Guidelines and, we believe, are inconsistent with written Federal Reserve policies.”
The Federal Reserve’s Board of Governors responsible for policy is composed of five members: Chairman Ben Bernanke, Vice-Chairman Donald Kohn, Kevin Warsh, Elizabeth Duke and Daniel Tarullo.
In response to clarification requests from the Appraisal Institute, the Federal Reserve’s Board of Governors issued a Jan. 14 letter confirming that a broker price opinion “does not satisfy the definition of an appraisal in the Board’s appraisal regulation.”
The Fed’s clarification was addressed to the Appraisal Institute and came in direct response to an Oct. 26, 2009, letter sent to the Fed by the nation’s four largest appraiser organizations that asked the Fed about its policy on the use of BPOs in valuing land and other real property collateralizing commercial loans.
“In response to your question as to the use of BPOs, it is the position of the Federal Reserve staff that a BPO does not satisfy the definition of an appraisal in the Board’s appraisal regulation,” the agency’s letter read. “Therefore, a regulated institution would not be able to utilize a BPO to originate a loan secured by commercial real estate when the loan requires an appraisal in accordance with the appraisal regulation.”
In its letter, the Fed added: “With regard to the use of BPOs as an evaluation, Federal Reserve staff has taken the position that a BPO does not provide sufficient detail on a commercial property’s condition, occupancy, and use to meet the guidelines’ requirements for an evaluation.”
Bill Garber, director of government and external relations of the Appraisal Institute, said: “We applaud the diligent position taken by the staff of the Federal Reserve Board, and we believe it is one that should be taken by all of the federal financial institution regulatory agencies.”
The Appraisal Institute and fellow appraiser organizations had sought clarification after reports that BPOs had been ordered by regulated financial institutions to satisfy the “evaluation” requirements for renewals of commercial loans and refinancing transactions. As the appraiser organizations had pointed out in their October letter, “[C]ommercial BPOs typically lack details on a commercial property’s conditions, occupancy and use as stipulated by the Interagency Guidelines. As such, any use by regulated or supervised institutions would constitute a violation of the Interagency Appraisal and Evaluation Guidelines and, we believe, are inconsistent with written Federal Reserve policies.”
The Federal Reserve’s Board of Governors responsible for policy is composed of five members: Chairman Ben Bernanke, Vice-Chairman Donald Kohn, Kevin Warsh, Elizabeth Duke and Daniel Tarullo.
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