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Magnolia vs. Noisette
By Molly Parker
Staff Writer
In many aspects, Robert Clement III and John Knott have a similar mission. In North Charleston, Knott, CEO of The Noisette Co., is trying to churn an urban community out of the old Charleston Naval Base that closed over a decade ago. In Charleston, on the neck of the peninsula, Clement is working to reshape a lifeless industrial site into a desirable neighborhood called the Magnolia development.
Both developers are seeking identical public financing from their respective city councils.
Physically, the projects are only a few miles apart, divided by the invisible line separating North Charleston from the Holy City. Both developers aim to prop up these struggling parts of the region, saying they are driven by a higher calling to break the cycle of crime and hopelessness that has beset both areas.
But politically, it seems, the projects may as well be on different planets.
Consider these statements from two city councilmen, one in Charleston, one North Charleston, regarding the large-scale, mixed-use development proposals in their cities.
• “When the project first started, we put together a saying that said we were going to bake a cake and we were going to do it together,” Charleston Councilman Jimmy Gallant said of the Magnolia development that Clement proposed building in his district.
• “Everybody wants to throw up when they hear the word Noisette,” North Charleston Councilman Bobby Jameson noted recently, saying he has grown weary of the company for what he sees as a lack of progress.
Those comments represent sentiments at their most extreme, but it does appear that Clement is easily navigating the political waters, while Knott is facing a public relations battle and strict scrutiny as he begins public infrastructure improvements for which the city is expected to issue bonds to repay the company.
North Charleston Councilman Kurt Taylor, one of the council’s biggest supporters of Noisette, said he thinks part of the differing treatment can be chalked up to the “emotional trauma” that reverberated through the city when the federal government announced in 1993 that it was closing the Navy base. The base was an economic engine in North Charleston and a source of patriotic pride, Taylor said, and a depression measured in dollars and attitude hit the area when it officially shut down three years later.
“That’s the genesis of this whole project, and it’s been nothing but struggles and difficulties ever since on that piece of land out there,” said Taylor, who is credited with introducing Knott to the city through a mutual connection, attorney Andy Gowder, Taylor’s brother-in-law and Knott’s then legal counsel.
At the base’s closing, instead of giving the land to the city outright, the state Legislature handed it over to the Charleston Naval Complex Redevelopment Authority, which tangled for years with the city about appropriate use of the property. Because of a number of additional setbacks, it wasn’t until late last year that Noisette finally secured all the property it needed to begin development, Knott said.
Clement, on the other hand, purchased the land on the neck from 27 different private owners and had already briefed the interested parties—neighborhood groups, environmentalists and city leaders—on his plans before they went public, creating a consensus around the Magnolia project.
And, to be sure, the two face vastly different challenges. The land where Clement plans to build required a massive cleanup effort that’s still ongoing to clear the environmental damage caused by the fertilizer and wood treatment plants that were located there years ago.
Knott’s project is unique because so many of the historic structures on the base have to be preserved and refurbished, which is generally more expensive than building anew. And the land is not the same; one development is going up in a neighborhood once fragmented by spotty industry, the other on a former military base.
But the differences may go deeper than blueprints and brick-and-mortar, those familiar with both projects theorize. The reaction to Knott and Clement may also speak to politics and attitudes in the greater Charleston region and tell a tale of two neighboring cities that share a border but that have developed in fashions as different as Gucci and Levi Straus.
North Charleston is a relatively young city. It was incorporated in June 1972.
“Like our sister city to the south, we have a rich history, but we’re still writing our history,” Summey said at a recent public dedication of new public housing not far from the Noisette development; it’s a statement he makes often in varying forms.
“If you look at the Noisette project as a whole, part of the problem that’s being created is created by forces outside the city of North Charleston. Because of the city’s rapid growth, it’s considered in some sectors as a threat or a competitor (with Charleston),” Knott said.
He called Mayor Joseph Riley Jr., who has held the city’s top office since December 1975, a “real strong machine” gifted at moving deals in Charleston.
“When you have a mayor in place for as long as he (has been), it gets to a point where if he says ‘yes’ it’s yes, if he says ‘no’ it’s no, where in the city of North Charleston, there’s certainly more people in the discussion about what’s going to be done,” Knott said.
The Noisette and Magnolia developments are not on the exact same timelines, but they are not far apart. Tax-increment financing districts already cover both properties.
The 216-acre Magnolia site, of which 153 acres is highland, is expected to include between 3,300 and 4,400 residential units and up to 1.3 million square feet of residential space. The Noisette blueprint is a bit more aggressive, slated to include 5,000 to 7,000 housing units at completion and up to 6 million square feet of commercial space on about 300 acres in what the company calls The Navy Yard at Noisette.
The North Charleston City Council’s finance committee is expected to soon have a meeting to consider the public financing piece of the Noisette project. The company recently broke ground on infrastructure improvements necessary to start building the city, including the creation of a large basin to ease flood problems on the base.
The city would not float bonds for the infrastructure improvements until Noisette completes the task, but outlining a funding agreement with the city would allow them the security to borrow money on the private market to pay for the construction. Knott said he expects phase one infrastructure costs to total about $70 million, $60 million of which he expects to be paid off through funds created by the tax-increment financing district.
Clement is asking for a similar financial deal, though he doesn’t plan to start construction of new infrastructure until later this year or early next year. He expects the cost to be around $35 million.
Both companies have also asked for their land to be included in a municipal improvement district, which is essentially an overlay tax on the developer. That money can be used to make up any shortfalls between the cost of the infrastructure and the amount of money raised through increased property values resulting from the development projects.
While Knott has been struggling to explain this idea in North Charleston, Clement has had a much easier time next door.
“It was not controversial at all. That’s what stunned everybody. It wasn’t even relatively (smooth), it was incredibly smooth,” Clement said.
Personal relationships help forge business deals everywhere, but deep roots can make a difference in a historical town flooded with outsiders. Though Knott and his wife have lived here 17 years, he hails from Baltimore; Clement is a native. Where Clement has an easygoing public personality and self-deprecating sense of humor, Knott tends to be more serious and intense in nature.
“Are there some people I rub the wrong way sometimes? I’m sure there (are). I’m a fairly forceful person and I’m committed to the vision and direction we’ve agreed on to go and I’m sure there are people who don’t like those (kinds of) people,” Knott said.
Clement also has faced some pushback to his development proposal over concerns that people would be driven out of the deeply rooted, largely black neighborhoods on the peninsula’s neck, and spent countless hours in discussions with city leaders, environmental groups and the black community. But Clement says he started early and before the project was in the public spotlight, letting all the interested groups have a seat at the drawing table.
“If we knew how hard this was going to be, I’m not sure we would have done it,” Clement said. “We looked young … when we started this. Now look at us, we can barely get around.”
His motivation to keep going: “Some day girls will sunbathe out there.”
Despite the differences in the projects and the political forces at work, both companies said they wish the other well. Knott said he believes success comes when you compete with yourself, not others. Craig Briner, managing partner with GreenHawk Partners, LLC, who is working with Clement on the development, said revitalizing both areas helps the region as a whole.
“I think both mayors along with the neighborhoods saw this as an opportunity to knit North Charleston and Charleston back together,” Briner said.
Molly Parker is a staff writer for the Business Journal. E-mail her directly at mparker@setcommedia.com.
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