Company wins argument in fight to redevelop Charleston property

By Vimbai Chikomo | May 4, 2016

CHARLESTON, S.C. (Legal Newsline) – A legal battle continues to brew in Charleston, S.C. over the proposed redevelopment of a 1950's-era high-rise building. It's a fight that could have repercussions for developers doing business in historic preservation districts across the country.

The Beach Company, headquartered in Charleston, sued the city's Board of Architectural Review (BAR) after the BAR rejected several of the company's concepts for the redevelopment of the company's Sergeant Jasper building.

In court filings, the company alleged the BAR's review process was "arbitrary and capricious."  On April 20, Circuit Court Judge J.C. Nicholson, Jr. sided with The Beach Company in ruling that the BAR overstepped its authority in denying The Beach Company’s application to redevelop the property.

The Beach Company lauded the ruling, with company CEO John Darby saying, “It is reassuring that Judge Nicholson took such a big step toward protecting property rights in Charleston.”

The city of Charleston has signaled its intention to appeal Judge Nicholson's ruling. Darby said such an appeal would force "the citizens of Charleston to miss out on an opportunity that won’t come again in our lifetimes."

"People ask me every day, 'Who wouldn’t want the Sergeant Jasper building torn down?" Darby said. "It is not lost on the citizens of Charleston that the City and opposing groups, who profess to be acting in the best interests of preserving Charleston’s beauty, are about to prevent the Sergeant Jasper from being replaced with a beautiful new building.

"Are (Charleston) Mayor (John) Tecklenburg, and the neighborhood and preservation groups willing to accept responsibility for this missed opportunity?"

Striking a balance between developing a growing historic city like Charleston and preserving its heritage is a task that often leaves developers and preservation boards at odds. And without clear guidelines on new structures, the tug of war between the two can become challenging, as was evident in the legal battle between The Beach Company and the BAR over the Sergeant Jasper apartment building.

Jim Burling, director of litigation at the Pacific Legal Foundation, told Legal Newsline that he has problems with zoning preservation boards because their guidelines are often “so arbitrary and ill-defined,” which potentially creates a slew of due process problems.

“By that I mean when you have a board that is making decisions based totally on aesthetic reasons, ‘I don’t like this project because it is not in conformity with the neighborhood.’ It is impossible to tell in advance what that means," he said.

What this creates, Burling said, is a situation in which developers begin projects with no idea whether their proposals are going to meet the “whims” of the BAR.

“It is impossible to tell in advance what that means," he said. "So you cannot tell going into a project approval process whether or not your proposal or your design is going to meet the whims of the architectural review board or the equivalent board that looks at these kind of highly discretionary, highly subjective type of problems."

Burling added that builders, developers, homeowners and even community members would be much better off with more objective standards.

“So if you are going to have standards based off, for example, floor area, rations, height restrictions, set back lines, those are things that can be measured and understood and things that you can look at in advance,” he said.

Many, such as Marc Scribner, a land use expert with the Competitive Enterprise Institute, share a similar stance.

“The unelected bureaucrats on the Board of Architectural Review and nosy neighbors may have all sorts of warm and fuzzy feelings about proposed real estate projects,” Scribner told Palmetto Business Daily in March. “But it is still unconstitutional to deny property owners their due process rights.”

Burling said that vague, “wishy-washy” language used by boards like the BAR to force developers to conform to neighborhood values and ideals and reject projects that are “out-of-character” with the neighborhood is extremely subjective. He added that he has come across many cases in which parties go back and forth until they are worn out and have exhausted their resources in the process.

Burling explained that there is so much leeway with the process of denying a project that a reason could vary from being a genuine concern for the neighborhood to an issue as petty as someone not liking the property owner, which creates problems that extend far beyond the courtroom.

“If that is your goal — to keep development out of an area — it works admirably. If your goal is also to drive up the price of housing and make it less affordable to buy homes and for your children to buy homes it works well for doing that,” Burling said.

“But if you are trying to develop a community, or maintain a community, where your children can have affordable housing, where you have a reasonable business climate so people can live in an economically sustainable area, it is not a very good policy. It all depends on what you want.”

More News

The Record Network