The longtime developer of Kiawah Island is under new ownership, a year after a high-stakes family feud over its valuable real estate investments went public.
South Street Partners of Charlotte said today that it has purchased Kiawah Partners for an undisclosed price.
“We’re excited to be a part of it,” South Street managing partner Patrick Melton told The Post and Courier in an exclusive interview today. “It’s a special place.”
The sale included valuable properties on Kiawah, Ireland and the Caribbean. Melton said the developer’s new management is “evaluating” the overseas holdings, but no immediate changes are planned as a result of the ownership change.
Melton said the acquisition represents a minimum 10-year investment for his firm and its backers.
The sale included more than 400 undeveloped lots and two private golf courses on the island — the River Course and Cassique — as well as Freshfields Village commercial center, Kiawah Island Real Estate and Kiawah Island Utility.
South Street said it will abide by the existing development agreement between the Kiawah Partners and the Town of Kiawah. Melton is meeting with elected officials today, and all island property owners are being notified about the sale by mail and email.
The new owners plan to proceed with the firm’s proposed 50-home development at Captain Sam’s Spit, a project that’s been blasted by conservation groups and other opponents.
Melton is taking over the CEO role that had been held by Charles P. “Buddy” Darby III, who is no longer with the company he co-founded 25 years ago.
“I want to thank all of our employees and property owners for their support and wish South Street Partners continued success,” Darby said in a written statement today.
The sale was the result of a family feud that culminated in a 2012 lawsuit over control of the Kiawah Partners’ valuable real estate holdings.
The two central figures in the dispute were Darby and first cousin Leonard Long, a former Kiawah Partners executive vice president. Their falling out triggered a lawsuit filed last June in Charleston County Court of Common Pleas.
The complaint was filed by Long and a group of partnerships, trusts and individuals who were minority owners in real estate ventures led by Darby. They demanded that the assets of those businesses be dissolved and for the properties to be either divided up or sold.
All of the plaintiffs and defendants are related to the late J.C. Long, whose real estate empire included the Isle of Palms and numerous subdivisions and commercial properties.
The lawsuit alleged that Darby had tried to “squeeze” the smaller partners out of their ownership stakes in what were called “the Kiawah entities.”
The complaint also suggested the minority partners objected to investments Darby was spearheading beyond Kiawah.
Kiawah Partners owns the money-losing Doonbeg golf resort on the west coast of Ireland and the proposed 2,500-acre Christophe Harbour development on the Caribbean island of St. Kitts.
The lawsuit was settled in December.
The terms were confidential, but the deal included a buyout clause. Long brought South Street Partners to the table and talks began in February. Melton said Long will have an advisory role with the new owners.
Long and Darby were part of the group that acquired most of the 10,000-acre oceanfront island in 1988 for $105 million. In the years that followed, Kiawah was transformed into a hugely successful high-end tourist and vacation-home destination. Last year, it was the setting for the PGA Championship.
“We believe it’s a first-in-class asset,” Melton said.
The buildup to the sale has been a hot topic within the local real estate industry in recent weeks.
The Sanctuary hotel and the other golf course on Kiawah, including the famed Ocean Course, were not part of the deal. Those are owned separately.
Check postandcourier.com later for more details or see Tuesday’s edition of The Post and Courier.