Charleston to benefit from delaying development again

Plans to develop 200 homes and a 100-room hotel on city-owned land that brackets Concord Park in Charleston have been delayed because of economic conditions.

The city is poised to extend the closing date for the property sale by up to a year.

In exchange for delaying the $16 million land sale until the end of next year, the city would get to collect a $1.85 million down payment that has been held in escrow, and would see its potential liability for environmental cleanup work reduced by $1 million.

Charleston Mayor Joe Riley said it's good news that the developers are still planning to proceed with the project, despite the proposed delay.

"Considering the economic times in our country, this is really good news," Riley told members of City Council's Real Estate Committee on Monday.

If approved by City Council, this would be the third time the closing date has been postponed. The deal was to close Dec. 16, and could be postponed until Nov. 16, 2009, with a possible one-month extension beyond that date.

The city agreed in 2006 to sell the 3.5 acres of land, plus an acre of right of way, to East West Cumberland Park Associates, a team that was chosen by the city from several groups competing for the land.

The land is split into two pieces, on the north and south ends of Concord Park near the South Carolina Aquarium.

The site including the park is where Ansonborough Homes used to sit. The 162-unit low-income housing complex was demolished in 1992.

The homes were damaged by flooding from Hurricane Hugo in 1989, and chemical contamination was found during preparations for the aquarium.

The city required the competing developers to include below-market-rate housing in their plans for the site.

East West Cumberland Park Associates has said 60 of the 200 housing units it plans to build will be below-market, with 16 condos priced for people earning up to 150 percent of the area median income and 44 apartments priced for rent to people earning up to 60 percent of the area median income.

Median income is the amount where half the people in the area earn more and half earn less. For a family of four in the Charleston area, median income is about $56,000.

Environmental contamination at the site was addressed previously, and the site is now used for recreation, but additional environmental work may be needed in order to develop the property.

The city had previously agreed to pay up to $4 million toward unforeseen cleanup costs, but the deal to extend the closing date would reduce that potential liability to $3 million.

Neither the city nor the developers expect environmental cleanup costs to be that high, but an agreement with the state Department of Health and Environmental Control has not yet been reached.

Wally Seinsheimer Jr. of Johns Island-based Dolphin Architects & Builders, a partner in East West, said the development team agreed to a reduction in the city's potential liability because "they wanted something and we wanted something."

Riley said that, when built, the development would add $250 million to the city's tax base, and the money from the land sale would allow the city to turn the Concord Park site into a fully realized city park.

Meanwhile, Riley said the $1.85 million in escrow money would help pay for renovations at the Dock Street Theatre.