Controversial hotel, parking garage project in downtown Beaufort paused indefinitely (2024)

BEAUFORT — A hotly debated construction project that sought to bring a 70-room hotel and multilevel parking garage to downtown Beaufort has been put on an indefinite hold by the developer, Beaufort-based 303 Associates.

The effort has been subject of a yearslong approval process, several lawsuits and publicly aired acrimony between project proponents and opponents.

“Because of litigation, we have been damaged by lost income plus the increased cost of construction and borrowing,” said Dick Stewart, founder and chairman of 303 Associates. “As a result of the those things, we have put the hotel and parking garage on hold.”

The nearly 62,000-square-foot hotel, which was planned for the corner of Scott and Republic streets, received its final approval from the city’s History District Review Board in June 2021, capping a process that started five years earlier.

Construction permits were issued by the city 18 months later in December 2022. The permit described a four-story structure with 70 rooms, a restaurant, bar, interior courtyard, rooftop bar and terrace. A note in the construction permit said that a planned pool would need a separate construction permit.

The four-story parking garage was also permitted at the same time. It’s location was set for the 900 block of Craven Street across from the Tabernacle Baptist Church.

Reaction to the decision to put the hotel and garage project on hold has been varied.

“We’re really not surprised because we were aware of borrowing costs in regard to hotels, and construction costs are up generally. We’ve all had litigation costs, and they are a burden,” said Cynthia Jenkins, executive director of the Historic Beaufort Foundation. The foundation is one of the entities that has taken on the city and 303 Associates in the courts to prevent construction.

Beaufort City Manager Scott Marshall said only that the city was unable to discuss the plans of a private developer.

“I’m surprised, but I understand given the current climate,” said Beaufort Mayor Phil Cromer.

Opponents to the project, including the Historic Beaufort Foundation, have argued that the project’s size and scale are not compatible with downtown Beaufort’s character. The two new buildings would have existed within the city’s National Historic Landmark District, a designation that has been in place since 1973.

“Beaufort is known for the small, intimate scale of its built environment, the natural setting, a variety of its architectural resources and the variable density within the district,” Alesia Cerny, architectural historian with the National Park Service, told The Post and Courier.

Earlier this year, the National Park Service published a 184-page study that examined the condition and integrity of the district. The report noted that proposed large-scale development projects have “caused concern among residents and alarmed preservationists, leading individuals and organizations to legally challenge decisions made by the city.”

The report later specifically references two hotel projects and the parking garage, stating that they would affect integrity of design, feeling, setting and association within the Beaufort National Historic Landmark District.

Stewart has countered that more parking is a necessity for the busy downtown area.

“We need parking. Ask any property owner downtown. Ask any restaurant operator. Ask any retail shop. Pretending we don’t won’t change that,” Stewart said.

Developer Graham Trask, through his business entities West Street Farms LLC and Mix Farms LLC, filed a lawsuit in April 2021 against 303 Associates and the City of Beaufort. The suit asserted that the approval of the hotel and parking garage by the city was improper and sought, essentially, to prevent construction from moving forward until the project could be reviewed by the Zoning Board of Appeals. Judge R. Scott Sprouse denied Trask’s request in June 2023, and Trask appealed several days later. According to court records, the appeal is pending.

A second suit was filed by Trask, again through his businesses, appealing the approval of the project granted by the Historic District Review Board in June 2021. The Historic Beaufort Foundation joined this appeal, which was subsequently denied by Judge Bentley Price the following January. Price’s decision was also appealed, and that is also pending.

In July of last year, 303 Associates went on the offensive. Stewart’s organization filed a lawsuit against Graham Trask, his father, George Trask, and other entities alleging that the Trasks “conspired to use improper means to destroy the projects.” It further asserts that 303 Associates suffered financial losses of approximately $40 million and seeks a judgement of triple that amount, or $120 million. That suit has yet to be heard.

“These projects continue to be litigated, and I don’t have further comment other than what’s in front of the courts,” Trask said of the recent decision by 303 Associates.

Having invested about $1 million in construction costs so far, Stewart said that his building permits will remain valid until such time that he opts to move forward with the project.

“We’ve done everything to hold our permits indefinitely,” Stewart said. “We’re going to build it when it makes sense to do it.”

Another 303 Associates project, the 19-unit apartment complex currently planned for 211 Charles St., is proceeding as planned and is not impacted by the decision to pause the hotel. The hotel site, he said, will likely be used for paid parking.

“I think about what makes good sense for us and what makes good sense for the community,” Stewart said. “This is not a sprint.”