Developer seeks to buy all units in downtown condo

Condominium owners at 99 St. Philip’s Place near the College of Charleston have received buyout offers from McAlister Development of Mount Pleasant.

A Mount Pleasant builder of student housing is seeking to buy all of the units in a condominium building near the College of Charleston, about five months after it acquired an adjacent property.

McAlister Development Co. has approached the owners of 99 St. Philip’s Place. It’s offering a total of about $12 million to buy all 62 units in the four-story building at St. Philip and Vanderhorst streets.

The property is adjacent to the YWCA of Greater Charleston, which was purchased in December for $8.25 million. The buyer in that deal was led by Anthony McAlister of McAlister Development.

The entity trying to buy the condos is 99 St. Philip Street LLC, also led by McAlister. Owners had until this weekend to respond to the offers.

McAlister Development officials are staying mostly mum on their plans for the site.

“We can’t make any comments at this time as we are in the middle of a business transaction,” said Mills Buxton, chief operating officer.

McAlister spoke briefly about the proposed acquisition Thursday. He described the condo building as student housing and said “it always will be.” He declined further comment pending the outcome of the buyout offers.

Marty Jackson, president of the 99 St. Philip’s Place homeowners association, said the 30-year-old structure needs work and has no reserve fund.

“It has a 30-year-old elevator and a 15-year-old roof,” the Mount Pleasant resident said.

Jackson, who rents out her unit, called McAlister’s offer fair, but she knows there is dissent among some of the other owners.

“There is a group that would prefer not to sell,” she said. “There is a group that prefers to sell.”

Jackson said she has not decided whether to take the buyout offer.

She said a handful of units are owner-occupied. The rest are rented. Jackson said two owners each own at least 10 percent of the units.

She said she doesn’t know what McAlister’s plans are for the property.

“People asked them that six different ways, and they didn’t get an answer,” Jackson said of a recent meeting between the owners and the development company.

Nancy Johnson of Tampa, Fla., bought a unit in October for almost $180,000. She said it needed work and she has invested about $25,000 to fix it up for her son, who works at The Citadel.

She said she did not respond to the McAlister offer of $185,000 for her unit. She said it was too low and she likes the location.

“It’s a block off King Street, it has a pool and it has parking,” she said. “It’s a great location. I’m not willing to sell for that price. For me, I’d be underwater because of the money I’ve already spent for remodeling. If they offered $300,000, I might have seriously considered the offer.”

A cover letter sent to unit owners with McAlister’s offers said if all of the owners do not sell, then the company’s goal is to buy enough units to gain “a controlling interest.”

“Upon achieving this ownership threshold, we would act to address much-needed updating to the building to maintain the value of our investment,” the letter said.

Jay Karen, a past president of the homeowners association, said he is concerned that the owners who don’t sell could be priced out by a large assessment to make building repairs.

“Are they going to be forced into a financial situation where there is a hostile takeover?” Karen said. “They might have a big assessment coming to fix the common areas.”

The Daniel Island resident, who does not plan to sell at the $185,000 price offered, said the developer has been vague about its plans.

“I don’t think they are doing it to play landlord like everybody has for the past 30 years,” Karen said.

To entice owners to sell, McAlister is offering $10,000 more on each purchase if all of the owners agree to sell by this weekend.

“I think they are going to have a hard time getting 100 percent,” Karen said. “For the price they offered, I’m not willing to sell.”

As for the adjoining YWCA site, it’s a 0.89-acre lot between Calhoun and Vanderhorst streets. McAlister said no decision has been made for the property, but it will be “some use to support the college.”

The YWCA continues to look for a new home, interim director Garcia Williams said. It has outgrown its current 5,000-square-foot building, which was built in 1964.

McAlister’s firm has built several student housing developments that collectively have added more than 1,800 beds on or near the College of Charleston since 1995. Its most recent deal was the eight-story Campus Center apartment complex at 50 George St. A Chicago investment firm paid $69 million for the 419-bed property last summer, a record for the peninsula.

Reach Warren L. Wise at 937-5524 or twitter.com/warrenlancewise.