Project name: Charleston Naval Base redevelopment
Location: Charleston, S.C.
Developer: Charleston Naval Complex Redevelopment Authority
Size: 1,700 acres
A “hot turnover” is the way James C. Bryan characterizes the 1996 transfer of operations at the Charleston Naval Base in Charleston, S.C. Hot turnover, in this case, refers to the method of keeping the industrial operations of a military base at full tilt while handing over control to civilian authorities.
“We never had to shut down the use of all the equipment on the base, and that was very helpful,” says Bryan, who has been chairman of the Charleston Naval Complex Redevelopment Authority, the state-appointed reuse agency, since 1995.
The Navy base, with 600 buildings and 21 piers, is the size of a port. At its peak, the facility employed 22,000 servicemen and civilians. To date, the large infrastructure has helped Charleston attract at least $141 million in new investment and more than 6,000 jobs.
In addition to the advantage the infrastructure brings, the base's existing buildings are enormous warehouses that can easily provide space for single users, or be divided for multiple tenancies. “We had a unique situation, in that we could start leasing immediately,” says Bryan.
The current confidence at the former Navy base is a sharp contrast to the gloom and doom that spread across the three-mile-long Naval installation in 1993, after the complex was placed on the BRAC list. Shortly following the announcement, Charleston city officials formed a committee called “BEST” (Building Economic Solutions Together), and the transitional base became an economic development attraction for the region.
At the same time, three counties surrounding Charleston formed a Redevelopment Alliance, and both the state and regional group marketed the naval complex to private industry. Rather than rely wholly on local authorities, the State of South Carolina also took an active role in reuse planning. “We added the base to their bag of tricks,” Bryan says.
Currently, more than 80 new businesses, as well some government agencies, occupy the base. One of the largest is the Charleston Marine Manufacturing Corp., a consortium of several local companies, which employ more than 1,700 people to manufacture and repair cargo containers in a 250,000 sq. ft. plant.
Replacing all lost jobs
The reuse authority decided to encourage the creation of new jobs at the former Navy base, rather than follow the familiar tactic of luring companies away from other communities, according to Bryan. For that reason, Charleston officials did not offer financial subsidies to new tenants beyond some rent concessions. “The whole process was based on good practices of seeking new jobs and new investment,” Bryan says.
To make the waterfront complex attractive to business, the Redevelopment Alliance agreed to temporarily waive rent payments for some users. For others, the alliance delayed the payment of property taxes until businesses could report a steady stream of income. In yet other cases, the alliance limited lease payments to a percentage of a tenant's income.
“We were lucky here,” says Bryan. “This place was primed and ready for development [well before the Navy left]. We actually had our first lease done three months before the base closed in April '96.”
For Charleston's largest industrial user, there are “pros and cons to being a tenant in a former military base,” says Richard Gregory, a managing member of Charleston Marine Manufacturing Corp. On the positive side, there are 101 acres containing seven industrial piers. The downside is the complex process.
Starting in 1995, the Pentagon would not agree to a lease longer than five years, “which is a big risk for an operation this size,” Gregory says. Two years later, however, the Pentagon approved a 30-year lease renewal, with an option to purchase. Shortly after that deal was finished, Charleston Marine decided to exercise its option, but the deal required signatures from many levels of government and took two and a half years to complete.
Still, the former navy installation has another achievement that few other closed bases can claim: Ten years after closure, Charleston's base-reuse effort has created more civilian jobs than the number lost in the closure process.