Nonprofit charts a new course for troubled South End development
A new, mixed-income housing development is set to take the place of a long-troubled, low-income housing complex in South End.
Brookhill Village is a paradox: An oasis of affordability in the midst of a booming and fast-gentrifying part of the city, but full of run-down units, many of them boarded up and visibly decaying from the street. Developed in the 1950s by the late C.D. Spangler, a wealthy Charlotte businessman, the complex of about 100 one-story buildings occupies 36 acres. Less than two miles away, uptown’s skyline glitters on the horizon.
The Brookhill Village apartments rent for an average of $475 per month.
Across Tryon Street and Tremont Avenue, hundreds of new luxury apartments and townhouses are sprouting, renting for thousands a month and selling for $400,000 and up, while breweries, bars, restaurants, arcades and office buildings have reshaped the neighborhood. But a complicated ownership structure has kept the Brookhill Village site from being redeveloped: a company affiliated with Spangler still owns the land, while the buildings are held by a separate entity through a long-term ground lease. Legal wrangling has persisted for years between the landowner and the former leaseholder.
Mecklenburg County real estate records show the nonprofit South Tryon Community Development Corporation purchased the lease interest (i.e. the buildings and other improvements, but not the underlying land itself) from a Charlotte real estate company on Dec. 31, for $792,000.
The nonprofit, incorporated last year by Rev. Ray McKinnon of the adjacent South Tryon Community United Methodist Church, immedialy sold a portion of the leasehold to Brookhill Land Lease Ventures LLC for the same amount. Brookhill Land Lease Ventures is affiliated with Thomas Hendrickson, a developer based in Wake County.
Hendrickson said the legal controversies and split ownership question that have dogged Brookhill Village have been put to rest. But completion of the new apartment development is dependent on securing financing. Hendrickson told the Charlotte Business Journal that he will need to close a $15 million funding gap to get the project built.
“The issues that have clouded Brookhill Village for years are gone. New Brookhill is an exciting half-affordable/half-market rate mixed income community that should be a case study on how to redevelop an area by providing quality housing without ignoring its history and displacing its residents. Now it depends on the Charlotte community joining us to find the resources to bring New Brookhill to reality,” said Hendrickson, in a statement.
The transaction also included a new ground lease and the dismissal of a federal government forfeiture action filed in 2016, in which the US Attorney’s Office claimed Brookhill Village had become such a nuisance and criminal hotspot that it should be seized.
Plans call for redeveloping a portion of the site with 324 apartment units. The mixed-income project would include 65 units for people making 30 percent of less of the area median income ($23,700 for a family of four). The greatest shortfall of affordable housing is for people in that income range, and housing at that price point requires the heaviest subsidies.
Another 97 units would be set aside for people making up to 60 percent of the area median income ($55,020 for a family of four) and two would be set aside for police officers making 80 percent of the area median income. The remaining 160 units would rent at the market rate.
The apartment development would cover almost 16 acres of the site, leaving about 20 acres for additional commercial development. The plan is to demolish existing units on a rolling basis, starting with unoccupied units, and give existing residents priority in applying for the new Brookhill apartments. New apartments will be completed on a rolling basis, with the intent of avoiding any displacement of existing residents.
McKinnon said called the sale price to acquire the leasehold “generous.”
“For two years, we have worked hard with Tom and his team to address complicated issues surrounding Brookhill Village. I’m proud that we have accomplished this, closed a very difficult transaction, and are ready to move forward,” said McKinnon.
Greg Pappanastos, president of Argos Real Estate Advisors, is managing partner of Brookhill Village II LLC, the company that owned the leasehold and sold it to South Tryon Community Development Corp. In a statement, Pappanastos said he is “very pleased” with the sale, which will allow “significant affordable housing for the future.”
“The value of land in South End has risen almost exponentially in the past few years, but it was clear to us that sticking with our plan to find a local community organization to help hampion
the thoughtful redevelopment of this property was the right thing to do for Brookhill Village and for Charlotte,” he said.