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Hampton Inn Project Going Back To Council For Permit Modification

The Carolina Beach Town Council voted in November to approve a request to build an oceanfront eight-story 100 room Hampton Inn and Suites on the northern end of the downtown Boardwalk at their November 12th, meeting. Now the Council will consider a modification to that permit in January.

Managing Editor

CAROLINA BEACH - The Hampton Inn and Suites project in Carolina Beach is ready to proceed but must undergo additional review by the Town Council concerning parking requirements.
The Council unanimously approved a permit to construct the eight story, 100-room hotel at 1 Harper Avenue on the Carolina Beach Boardwalk during their November 12th, meeting.
Blanchard & Calhoun Commercial, a real estate development and commercial brokerage firm in Augusta, Georgia, purchased the property from a previous owner who had planned to construct a Hilton Garden Inn at the same location.
This site was previously approved for a 191-room 125 foot tall hotel in 2007. The site has since been sold and is a completely different project from the previous approval.
Currently on the site is 170’ of right of way for Carolina Beach Avenue N. and 41,930 sq. ft. of vacant land. The building site property is .96 acres located in the CBD. The proposed structure is 87.5’ feet in height. The footprint of the structure is 22,626 square feet.
A pool will be located on the second floor, along with a breakfast café, outside bar area and an outside seating area. This will be alongside the future elevated boardwalk and will be directly accessible from the boardwalk.
The café will operate for service to hotel guests. Bicycle racks will be provided on the ground floor adjacent to Harper Ave.
The hotel will have direct access to the boardwalk to promote the use of boardwalk facilities and entertainment.
The project requires 100 parking spaces. 73 of those spaces were provided on the hotel property. The developer was asking for a waiver for 9 spaces lowering the requirement to 91 spaces overall. The three public parking lots between Harper Avenue and Carl Winner Street were to be redesigned to act as one large parking lot by the developer to increase available parking. 18 spaces in the parking lot closest to the Boardwalk area near the corner of Harper Avenue and Canal Drive would then be designated for hotel use.
The developer said those spaces would typically only be needed during the busy peak times of the summer tourist season. The spaces would be labeled as hotel parking spaces.
Following approval of the conditional use permit for the hotel project, the Council approved closing a 170' portion of Carolina Beach Avenue North to facilitate the hotel project.
The developer owns property on either side of that portion of the road. Now closed, the road will become part of the hotel property.
Town Manager Michael Cramer sent an update to Council on December 6th, explaining, "At the November 12, 2013 Town Council Meeting, Mayor Pro Tem Steve Shuttleworth made a motion to approve the Hampton Inn Hotel Project with the fact that it met all seven required findings, general conditions 1-4, and is conditioned upon the recommendations of the draft grant order that was listed in staff.  Also direct staff to negotiate a lease after 20 years for the 18 [parking] spaces and report back to council what that lease is, preferably close to some kind of market rate and also to memorialize the landscape changes, specifically the connectivity to the boardwalk, the sidewalk expansion from Carl Winner to Harper and the grading of the Harbor Master lots. The motion was carried unanimously."
Cramer explained, "Following the meeting, staff reviewed the motion and developed the grant order approved at the November 12, 2013 council meeting.  During the review it was brought to the attention of staff that the portion of the grant order motion that stated “Also direct staff to negotiate a lease after 20 years for the 18 spaces and report back to council what that lease is, preferably close to some kind of market rate and also to memorialize the landscape changes, specifically the connectivity to the boardwalk, the sidewalk expansion from Carl Winner to Harper and the grading of the Harbor Master lots.” may not be in conformance with North Carolina General Statue 160A -272."
That State statue reads;
§ 160A-272.  Lease or rental of property.
(a) Any property owned by a city may be leased or rented for such terms and upon such conditions as the council may determine, but not for longer than 10 years (except as otherwise provided herein) and only if the council determines that the property will not be needed by the city for the term of the lease. In determining the term of a proposed lease, periods that may be added to the original term by options to renew or extend shall be included. Property may be rented or leased only pursuant to a resolution of the council authorizing the execution of the lease or rental agreement adopted at a regular council meeting upon 10 days' public notice. Notice shall be given by publication describing the property to be leased or rented, stating the annual rental or lease payments, and announcing the council's intent to authorize the lease or rental at its next regular meeting.
(b) No public notice need be given for resolutions authorizing leases or rentals for terms of one year or less, and the council may delegate to the city manager or some other city administrative officer authority to lease or rent city property for terms of one year or less. Leases for terms of more than 10 years shall be treated as a sale of property and may be executed by following any of the procedures authorized for sale of real property.
Cramer explained, "After review by Town Attorney Noel Fox, it was determined that the CUP was valid and that town property can be leased for more than ten years.  However, due to the proposed lease term (40 years or 20 years depending on your interpretation of the Motion for approval) additional steps must be taken by Council (resolution, upset bid period, Council approval) to fulfill the requirement."
For a period longer than 10 years, a process would be used to permit others to submit "upset bids" through a multi-month process.
Cramer explained, "Due to these additional steps, the possibility of upset bid and the time frame for completion of the additional steps, the Developer is considering applying for a modification of the CUP site plan. The proposed plan is to utilize recently acquired property and on site plan modifications to allow the Developer to establish an additional 7 parking spaces on their own property. These changes will allow the Developer to provide 79 parking spaces on their property and they will request the town waive a total of 21 parking spaces.  Through the November 12, 2013 grant order, town council has already waived 9 parking spaces, so the Developer is asking for an additional 12 spaces to be waived."
He explained, "In addition to the waving of the parking spaces the existing CUP requires “the sidewalk expansion from Carl Winner to Harper and the grading of the Harbor Master lots.” These improvements will add an estimated 44 public parking spaces to the existing 14 public spaces for a total of 58 spaces in the Harbor Master Lot.  Using the existing Harbor Master Lot revenue as a benchmark we anticipate an increase in revenue estimated at approximately $8,018.00 per year for the new parking spaces."
Cramer explained, "With the proposed CUP modification the Developer will meet the parking requirements and will not require the use or modification of the town’s “Palms” parking lots. If for some reason the Developers business model is
not correct and additional parking is required then either the hotel or the hotel clients will pay for parking in the town parking lots in a “first come first serve” manner."
He explained, "Staff has reviewed the draft proposal and determined that the requested modifications are within the minor change category for Conditional Use Permit changes, but the additional waiver of the parking requirements constitutes a major change and can only be authorized by town council.  The requested modification would allow the Developer to meet the towns parking requirements, but would also eliminate the Developers requirement to fund the redevelopment of the town parking lots in order to create spaces for them to lease.  The proposal would essentially enable the developer to meet the parking requirements on their property and not require any change to the town parking lot."
Cramer explained, "The final concern is over the timing of the modification. The Developer is utilizing the CUP grant orders as proof of project viability to its lenders.  In order to receive the funding for the project and begin construction in January 2014, the CUP grant order modification process must be completed by the January 14, 2014 council meeting or the project will be postponed until January 2015.  The developer currently intends to open the hotel for the 2015 tourist season if the order is modified at the January 14, 2014 meeting."
Cramer informed Council that for those reasons he has placed the item on the Council's Consent Agenda  for the December 10th, meeting to schedule a public hearing and Council vote on the CUP modification at their January 14th, meeting.
He explained to the Council on December 6th, "Staff will immediately advertise the CUP modification in the Star News and the Island Gazette before the regular scheduled Planning and Zoning Committee Meeting on December 12, 2013.  The Planning and Zoning Committee may, if appropriate, recommend the modification to town council, at which time staff will follow the advertising requirements for a CUP modification for town council."
He explained, "Following advertisement in this manner, a public hearing and vote may be held on January 14, 2014 by the Town Council regarding the CUP modification" and, "By following the aforementioned process we believe that the Developer can satisfy the town parking requirements, meet the advertising and public hearing requirements and,
if approved by Planning and Zoning and the Town Council, begin construction of the new hotel as scheduled in January 2014."