Over the past several months, we have analyzed six years of the Preservation Trust Financials (2016-2021) which are currently available. These financials, along with our observations, are presented and evaluated in our newest FAQ, entitled “Palmetto Bluff Preservation Trust Financials—History, Trends and Observations.”

Click here to download a PDF of the full FAQ and financial summaries.

Key highlights include:

• Total annual total Preservation Trust revenue has grown from $6.6M in 2016 to $14M in 2021, a 16.2% Compound Annual Growth Rate (CAGR).
• Regular Assessments, which are what property owners pay via their annual assessments, have grown from $3.4M to $5.9M over this period, or at an 11.4% CAGR. These assessments are the largest revenue contributor and represent 42.1% of total revenues. Other revenue sources include DRB fees, gate fees and a range of other sources detailed in the FAQ.
• Reliance on property owner assessments has grown from 42.1% to 53.6% of total. As real estate sales slow, the financial reliance on property owners is likely to increase.
• Maintenance has been by far the largest expense, growing from $3.7m in 2016 to $5.3M in 2021, a 7.7% CAGR. Overall, maintenance represented 61.7% of non-pass through spend in 2021. Conversations with management indicate that landscape maintenance and repair is the largest component, followed by road/bridge repair (at roughly 2/3rd of landscaping).
• Security is the next largest expense, growing from $1.2M in 2016 to $2.5M in 2021. In 2021, security accounted for 29% of non-pass through spend. Security services, which operate 24/7, are provided by an independent company led by Charles Huggins, and his company, Security Services, comprises most of this line item. Security’s ancillary duties include managing the post office, collecting gate fees and maintaining the roadway gates.
• Administration is the third largest expense category, and this comprises both direct management costs as well has allocated costs from the developer (and other shared resources).
• The Preservation Trust’s revenues exceeded expenses for the last three years (2019-2021), leaving an operating surplus of $4.7M. This is in addition to financial reserves of $4.9M.

NEXT STEPS. We plan to discuss these findings, as well as to address member questions, during our next in person PBNA member meeting. In the meantime, we will continue to evaluate financial information as it becomes available and share our observations with you. Also, we look forward to the upcoming reserve study, which management believes will be more comprehensive, granular, and accurate than prior studies which are still relied upon.

This FAQ outlines our Town and County government, as well as State and Federal officials and representatives.

Town of Bluffton. Since 1998 (?), Palmetto Bluff has been part of the Town of Bluffton. It was annexed to be part of the Town by way of a referendum which also approved the Development Agreement between the original developers (Union Camp) and the Town.

Our elected officials include a Mayor (Lisa Sulka) and a five member Town Council. In addition to the Mayor, the Council includes Fred Hamilton, Larry Toomer, Bridgette Frazier, and Dan Woods. These elected officials serve overlapping 4-year terms, serve at-large and elections are held every 2 years.

Day to day operations are administered by employees who report to the Town Council:

• Town Manager: Stephen Steese
• Two Assistant Town Managers: Chris Foster and Heather Colins
• Town Clerk: Kimberly Gammon
• Town Attorney: Terry Finger
• Chief of Police: Captain Scott Chandler (interim Chief)

The Town of Bluffton has its own police force, but the schools and libraries are operated by the County. Water and sewer services are provided by the Beaufort Jasper Water and Sewer Authority.

To read more click here.

Many PBNA members have asked about the adequacy of the financial reserves held by the Palmetto Bluff Preservation Trust (PT). Here is what we know:

• At year end 2020 (the latest financials available), PT had $4,419,719 in the replacement fund, up from $3,656,783 at YE 2019.
• Pasted below is the footnote regarding the adequacy of the reserves; the auditor states that the reserves are “conservative”.” Note that the largest item is asphalt pavement, making up of half of the total assets.
• However, the reserve analysis is based on a 2016 study, which would not reflect the substantial expansion in roads and site improvements as new neighborhoods are added. The analysis is also silent on cost inflation and any accelerated wear and tear caused by the stepped-up pace of construction within PB.
• The PT has been spending $4-5 million annually (2017-2020) on maintenance, which the auditor states is a “robust” amount for common area maintenance. High levels of maintenance spend may reduce the importance of the reserve amount.

So what should we conclude about reserve adequacy? The answer depends on your time horizon and degree of conservatism:

• Longer term, the PT will become the direct responsibility of the PB property owners, but this is likely a long way off. At the time of “turnover”, SC law requires that the commonly held assets be in good repair, and that financial reserves are adequate. While these standards are subjective, they can be the subject of litigation. For example, there is an on-going lawsuit on such an issue between another Bluffton developer and the property owners for approximately $ 20 million.
• Shorter-term, we do not see any immediate issue other than the increasingly dated and incomplete asset inventory upon which the auditor reports and opines on reserve adequacy.

On April 12, 2022, a group of Palmetto Bluff property owners initiated a legal action in the County of Beaufort’s Court of Common Pleas, which is the relevant court for a real estate dispute concerning Palmetto Bluff. The filing is essentially a “Complaint,” and asks that the Defendants respond to the arguments in the Complaint. For those who have had trouble accessing the document, we have put a PDF copy of the Complaint on the PBNA website.

To best understand this FAQ and the substance of the legal action, we suggest you first read (or re-read) three other PBNA FAQs to familiarize yourself with the basics:

1. What is the longstanding controversy around the rental properties, and when will this be settled?
2. Can you explain in plain English the various entities that make up Palmetto Bluff?
3. I was given a lot of documents when I bought my property, but I never read them. I also understand there are other important governing documents. What do I need to know about these?

This legal action was initiated by a group of approximately 20 Palmetto Bluff property owners (some are individuals, others are couples, trusts or LLCs)—collectively known as the plaintiffs—against several Palmetto Bluff entities as well as individuals who are Stewards of the PB Preservation Trust’s governing board:

• Defendant entities include PB Development, PB Club, PBLH (hotel owner), PB Real Estate, PB Preservation Trust, PB Preservation Trust Board of Stewards, SSP, along with a placeholder for additional entities as may be identified as the legal action proceeds
• Defendant individuals, all members of the PB Preservation Trust’s governing board, include Jordan Phillips, Mark Polities, Gray Ferguson, and Henry Armistead

It is important to note that the plaintiff group, which calls themselves Palmetto Bluff Advocates, includes property owners of homes within the designated rental areas (the majority) as well as some owners of properties outside of the designated rental areas.

The 83-page Complaint is broad and comprehensive. The Complaint:

• Is not limited to the Short-Term Rental (SRT) issues; rather, it also argues that
• • The underlying PB governing documents are illegal under SC law; and,
  • The owners have operated inappropriately and have failed to meet their fiduciary obligations and duty of care

This legal action could have broad implications for all PB property owners. While it is impossible to predict what will happen, here are some things to keep in mind:

• The expected litigation is likely to take two to four years
• All filings and court proceedings are public documents, and are likely to attract attention from the press, the real estate broker community, and other interested parties
• The litigation may create a cloud of uncertainty, which some property owners believe could hamper the marketability and value of PB homes and lots
• If certain of PB’s governing documents are declared illegal, it is unclear how new documents would be drafted and approved

UPDATE: In July, a number of motions were filed by the Plaintiffs, including one for Partial Summary Judgement and another that seeks to disqualify Nexsen Pruet (long time counsel for PB’s many owners) from representing SSP (and related entities). SSP (and related entities) have filed various motions in response. If you would like to read more, the filings are public on the Beaufort County Clerk of the Court website.

In an August 24, 2022 email from SSP to the PB Community, they addressed the litigation by saying: “…these homeowners appear to object to limiting access to Club facilities to members and guests, and seek short-term renter access to all existing and future amenities at the Palmetto Bluff Club. The lawsuit also challenges the governance structure of the Club and the Trust, which may affect whether any future amenities can or will be part of the Palmetto Bluff Club. Given the pendency of the lawsuit, and the resulting lack of certainty regarding the ownership and management structure for amenities, we are unable to finalize and disseminate our plan for Palmetto Bluff Club member access to any future amenities. We will keep you informed about Club member access policies as we get closer to completion of these projects, and we hopefully find a resolution to the litigation.”

We can not speak to the validity of SSP’s comment above that the litigation will slow down the expansion of Club amenities

We will continue to update this FAQ as the litigation progresses, and we learn more.

One more thing: As this FAQ describes the circumstances around a legal matter, a disclaimer is in order. Please know PBNA is simply an observer and is not party to the action and has no access to any material non-public information. Should any of our kind readers choose to join this legal action, you cannot and should not rely on any information from the PBNA.

There is a long history of having certain limited areas of Palmetto Bluff having homes eligible for short term rentals.  There is also a long history of the “rules” being in flux, and property owners being upset by changes which they felt affected their economics.  For example,

• In the early days, Wilson Village lots were marketed to prospective owners with the prospect of attractive rental income from such a limited supply of attractive homes in the Village, as they were told that Wilson Village would be the only neighborhood with rental rights.  Many Savannahians invested in homes, thinking that they could use the homes as investment properties, with the option of using the homes personally as well.  
• Over time, additional neighborhoods were added to the short-term rental population, creating considerable consternation among many of the original property owners as they believed more “supply” would affect rental pricing.
• Section 11.3 of the Community Charter states, “Founder reserves the right to designate areas within the Community as Rental Areas.”  The areas are typically referred to as the “Designated Rental Areas (DRA).”

A significant legal action began earlier this year regarding this controversy. On April 12, 2022, a group of Palmetto Bluff property owners initiated a legal action in the County of Beaufort’s Court of Common Pleas, which is the relevant court for a real estate dispute concerning Palmetto Bluff. Short term rental is one of several matters addressed in this lawsuit. For more detail, please refer to “Legal Action” FAQ which was recently updated. The remainder of the FAQ further describes key aspects of the short-term rental matter.

Currently, short-term rentals are allowed in four Palmetto Bluff designated rental neighborhoods: Wilson Village, West Wilson, Tennis Cottages, and in portions of Moreland.

• Property owners in these neighborhoods have the option to rent their homes, not all of them do. 
• Roughly 95 homes are actively rented, which represent 45 to 50 percent of the total homes in those neighborhoods. 
• Homes are typically rented for 100 nights each year, although there is wide variation.
• Property owners who wish to rent their homes can do so in one of three ways: a) directly market and manage the property themselves; b) use a third party property manager to market and manage their home; or c) use Montage to market and manage their residence.
  • Approximately 30 homes are managed by Montage while 65 residences are managed by one of four independent property management companies or rented directly by the property owner.
• Owners of rental properties need to have a permit from the Town of Bluffton and follow the Town’s rules and requirements.  Here’s the link:  https://www.townofbluffton.sc.gov/705/Short-Term-Rentals
• A great deal of information can be found on the PB Member website, under “My Community,” and then clicking on the first option, “Outside Home Rentals.”

There are long-standing tensions between houses rented independently (directly or via a 3^rd party property manager) versus Montage Rental Program (aka, Founder Designated Rental Program)

• Until January 1, 2022, guests renting via Montage had better access to amenities and restaurants.  For example, they could access all fitness facilities, all pools (except Lodge), Club restaurants (Coles, Canoe Club, and May River Grill), Shooting and Boat Clubs, and the Boundary’s bowling alley and game room.
• Guests renting independent properties access some facilities by paying a daily resort fee, which is currently $ 60.00 per house per day.
• After April 1, 2022, Montage and independent renters will have less access to various Club amenities and restaurants, but the Montage renters’ access will still be superior to independent renters as they have access to Hotel facilities (See the Member Website for full details).
• The superior access to facilities has generally allowed Montage to command higher pricing, compared to independent renters.  However, Montage retains a higher percent of the rental revenue, which offsets some of the higher pricing.

These tensions increased significantly beginning in 2019, when the then owner of Palmetto Bluff, proposed significant Covenant changes for rental properties.  The most significant proposals include:

• Increase in the daily resort fee from $60 per house per day to $ 75 per bedroom per day.
• New requirements including mandatory $1M liability insurance, 24-hour access to property management and trouble reporting, certain registration requirements, and maintaining an office in Beaufort County.
• Prohibition of using any PB images or trademarks in marketing materials.

According to the “Outside Home Rental Q&A” posted on the Club’s website, the developer’s arguments for the higher daily resort fee for independent renters include:

• The independent renters impose additional costs on the Club: tracking, access card distribution, enforcement of Club policies and such.
• The Club’s purpose is for member enjoyment, and not for making a profit.

The owners of the non-Montage rental homes argue that they purchased their properties with the expectation that did not include any of the proposed changes.

A group of approximately 40 property owners retained legal counsel and initiated mediation with the developer.  Per Palmetto Bluff’s organizing documents, property owners are required to mediate disputes with the developer prior to any litigation.

• The mediation began under prior owners, and continued with SSP
• In response to a property owner question at the February 17, 2022 Town Hall meeting, SSP Managing Partner Patrick Melton told the attendees that the mediation had ended.
• The details of this dispute are confidential.
• This has led to litigation that addresses the rental issues as well as broader matters relating to the legal structure of the community. Please see separate FAQ for more details.

The Palmetto Bluff Club (PBC) should be simple, but there are several complexities and controversies.

First, some basic facts and background.  The PBC is a for-profit corporation owned by SSP which owns and operates the amenities (e.g., The Lodge, Canoe Club Pool/Fitness, The Boundary),  several restaurants (Coles, The Canoe Club, May River Grill), organizes fitness programs, and sponsors a wide range of programing.  The Club was established by the 2003 Community Charter, and is governed by the 2003 Recreational Covenant, which has been amended 66 times.  The golf and tennis facilities are governed by separate entities.

Club financials for 2018, 2019, 2020, and 2021 are on the PBNA website. We invite you to review the Club’s operating results. 

Property Owners have several questions about the Club:

• How are annual dues set?
• Are the relatively new, and increasing, joining and transfer fees going to the Club?
• Why was the property owners Right of First Offer not made in 2021 when the former owner decided to sell Palmetto Bluff?
• Is the Club a homeowner’s association (HOA) and should it be managed as such according to SC laws?
• What’s behind the rumors of the Club becoming optional?
•  Can we know more?

These are addressed in turn below.

DUES.  The basis for calculating annual dues has changed over time.  The Membership Plan, which was in effect between 2003 and 2017, used language consistent with the Recreational Covenant (section 3.1) for setting dues:

• “The dues for Community Membership shall be based upon a budget of the estimated costs of maintaining, repairing, replacing, insuring, operating and providing the facilities, activities, and events available for the use and enjoyment of Community Members, and a reasonable share of the overhead expenses associated with general operation and administration of the Club.”
• Many interpret this to mean that the Club is specifically not intended to be a profit center to the club owner/developer

However, this dues-setting language was removed from the Membership Plan in 2017, and it is unclear what dues calculation methodology is used now.

JOINING/TRANSFER FEES.  It is our understanding that the initiation ($30,000 for new members) and transfer ($5,000 per transaction) fees are currently not funding the Club’s operations or capital spending.   

• However, the current Membership Plan (downloaded February 15, 2022, page 8) states “Membership Joining Fees and other amounts paid to the Club are the property of the Club and may be used for any purpose determined appropriate by the Club.” 
• If the Club were organized as a not for profit entity, then these fees would be used to fund Club operations, reserves and capital improvements.
• Between 2019 and 2021, these fees are estimated to aggregate to in excess of $ 16 Million.  These fees are clearly not reflected in the 2022 dues calculations. 

ROFO.  The Membership Plan has always included a right for Club members to acquire the club “prior to soliciting offers from the general market.”   Members “shall have a sixty (60) day exclusive period from receipt of notice to make an offer to purchase Club Facilities….”

• This requirement was not met by the prior owner.

HOA?  Many property owners have long argued that the Club meets the legal definition of being a homeowner’s association under SC law.  SC law states that if an entity is both 1) mandatory, and 2) has the power to lien the property, then it is a HOA.

• To our knowledge, this has not been tested legally in SC.
• If the Club were to be recognized as a HOA, then the developer could not run the Club as a for-profit entity.
• This issue may be addressed by courts as part of the on-going litigation initiated by a group of Palmetto Bluff property owners. Please see the “legal action” FAQ for more details.

BECOMING OPTIONAL.  The new owners have mentioned to several property owners that they may make the Club optional in the future.  This could have many unfavorable consequences for existing property owners and would likely receive significant push back.   Please refer to the “bulk sale” FAQ for more information.

KNOW MORE.  The 2003 Declaration of Recreational Covenant for Palmetto Bluff provides for transparency, as follows:

• Section 3.6 sets forth property owners rights to information: “Such books and records shall be made available for inspection and copying by the owners…. upon reasonable request during normal business hours…”
• This section also permits auditing: “If any Owner…. desires to have the records audited, it may do so at its expense and Club Operator shall cooperate by making available to the auditors the records, including all supporting material, for the year in question.”

As noted above, SSP provided actual financials for 2018 through 2021.  To our knowledge, to date no one has exercised the right to audit records.

• Are you committing to holding Town Hall meetings on a regular basis, prior owners have?
• Do you plan to place additional land into formal conservation easements?
• When common areas are used for weddings and such, how much of the rental fees go to the Preservation Trust?
• Do you plan to add any property owners to the Board of Trustees that governs the Palmetto Bluff Foundation (aka Conservancy)?
• Did SSP acquire all of Walcam’s property as part of your purchase of Palmetto Bluff?
• Since the last Preservation Trust reserve study was in 2016, when do you plan to conduct a new study?
• Do you plan to use the higher Club initiation and transfer fees to augment capacity of the various Club amenities?
• Which marketing activities are paid by the property owners through the Preservation Trust, and which by the developer?
• How do you set the management fee you charge for administering the Preservation Trust?
• Can you comment on the rumors circulating about a bulk sale of approximately 1,000 lots in the next couple years?
• Since maintaining the pristine waters around Palmetto Bluff has always been a priority in the Development Agreement, why should over water fueling be allowed now when it has always been explicitly prohibited?
• What are your plans for developing Long Island and Dough Boy Island?
• Why are independent conservation groups and Bluffton residents so opposed to development of Anson, Long Island and Dough Boy Island?
• It is my understanding that Anson Marina and its amenities will be open to the public at large. If so, how will Palmetto Bluff's existing neighborhoods be kept protected and secure from non-member transients?
• Has the Access Agreement that expired on December 31, 2021 been updated and codified to take into account the new Montage/PbClub relationship? Can that access agreement be shared with residents?

We have heard these rumors as well but have no concrete knowledge.  Some observations and concerns are below:

First, a bulk sale could make financial sense to South Street Partners (SSP):

• Given the structure of SSP’s funding (much coming from sophisticated third parties interested only in financial gain), it is logical that SSP would want to accelerate positive cash flows to investors, which a bulk sale would help accomplish
• By selling bulk lots to another developer/builder, they also avoid the substantial negative cash flows inherent in preparing the lots (adding sewers, water, utilities, sidewalks and roads).  Again, this makes financial sense if the goal is to maximize net positive cash flows to their investors as quickly as possible

Second, a bulk sale is unlikely to be in in the best interests of current Palmetto Bluff property owners:

• The most likely buyer of hundreds of undeveloped lots would be a major national volume-home builder.
  • If this is the case, it is unlikely that the quality of these homes would be consistent with what already exists in Palmetto Bluff.  This could have serious repercussions on property values and the marketability of existing Palmetto Bluff homes. 
  • This would also call into question whether any new “sub-community” created by bulk sales would be consistent with our Community Charter.
• Another scenario involves SSP selling the lots to another (and potentially separately capitalized) SSP-controlled entity.

Third, to improve the marketability (and lower the price point) of the homes in the bulk sale area, SSP could attempt to change Club rules to exempt owners in this certain “sub-community” from mandatory membership in the Palmetto Bluff Club.  This potentiality raises a host of questions and concerns:

• Is this permissible or would it violate the recorded documents for the community?
• Would residents of this sub-community still have effective access to PB Club amenities, even if they are not dues paying members?
• Would this sub-community have its own amenities and/or restaurants?
• What are the implications for infrastructure, traffic, etc.?

Other questions raised by this issue:

• Where are these lots located?
• Are they already subdivided/approved and shown on plats?
• Would they have their own entrance off New Riverside Road?
• Would the developer of these attempt to market them as part of the Palmetto Bluff community?

Lastly, what can we do about this?

• SSP has the legal right to make bulk sales of lots.  We can only influence how they are developed.
• Given that an important property owner right is the expectation that the owner will develop Palmetto Bluff in accordance with the Development Agreement (as amended) and in accordance with the nature and character of how Palmetto Bluff was represented to each of us at time of our purchase, we would have a strong argument around how any bulk sale lots would be developed.  Requiring the owners’ adherence to a Common Development Scheme/Master Plan may be accomplished by:
  • Direct pressure from property owners through face-to-face meetings with the Developer, or,
  • Should the Developer be unwilling to address property owner concerns voluntarily, property owners can initiate legal or equitable actions in the Beaufort County Court of Common Pleas to require Developer’s adherence to the Development Agreement and Common Development Scheme details in existence at the time of the property owners’ lot or home purchase.

• In other developments, existing owners have purchased bulk lots in order to add more land to open space.  Spring Island residents did this, although the scale was much smaller than what would be involved here

In early 2022, SSP petitioned the Town of Bluffton for two changes to the 1998 Development Agreement (the “DA”) and the 2012 Fourth Amendment to DA with respect to a planned marina at Anson. Specifically, they are requesting 1) an additional dry stack storage at Anson; and 2) permission for over water fueling at Anson. Key points:

1. These “asks” are controversial as the water access issues have been heavily negotiated over the past 20+ years, and the proposals are viewed by many as re-trading previous agreements. {read more—see #1 below}
2. In 2005, the Town approved a Second Amendment to the DA that defined the single water access point at Anson point to be a marina. This amendment specifically did not include a second dry stack nor allow overwater fueling. Overwater fueling is opposed for a variety of reasons {read more—see #2 below}
3. Many PB residents, local citizens, and environmental groups consider Anson, along with Long Island and Doughboy Island, to be fragile and oppose any increase to the amount of development currently allowed under the master plan or the DA {read more—see #3 below}
4. As most PB residents are not personally familiar with Anson, a good resource are pictures and drone videos produced by the SC Coastal Carolina League {read more—see #3 below}
5. The Bluffton Town Council referred the proposed amendments to the Negotiating Committee on November 9, 2021 and the Negotiating Committee met on January 6, 2022 for two hours. At that meeting, SSP shared high level plans and schematics for the Anson Marina. At the close of the second hour, the Committee Chair instructed SSP to conduct a community meeting with PB property owners, which SSP held on February 17, 2022.
6. A second meeting of the Negotiating Committee occurred on May 17, 2022, with much of the discussion behind closed doors and not open to the public.
   1. Subsequent Negotiating Committee meetings were scheduled for the summer of 2022 but were canceled. As of September 1, 2022, the next meeting has yet to be scheduled.
   2. If you wish to comment on these matters, a list of the Committee members and their email addresses are available here {click for link to #4}.
7. At the time of this posting, no materials are available yet on the Town of Bluffton website. We will notify PBNA members when these materials are available.

To read more detail click here.

There is no doubt that we live in a community with a complicated structure. While there are many more separate legal entities, there are essentially five primary operating entities that we should be familiar with:

• The Palmetto Bluff Preservation Trust—Our not-for-profit property owners association, administered by SSP {Read More--#1 below}
• The Palmetto Bluff Club -Our for-profit club run by SSP {Read More--#2 below}
• Montage Palmetto Bluff -Independently operated hotel run under a management contract with SSP {Read More--#3 below}
• South Street Partners – A real estate focused private equity firm which owns the Palmetto Bluff Community {Read More--#4 below}
• The Palmetto Bluff Conservancy—a not-for-profit organization whose mission is environmentally oriented {Read More-#5 below}

In addition, certain parts of PB are zoned for commercial activity. Examples include certain retailers (e.g., Paris Market), the new Citadel storage facility and Sora Wellness. Outside, an independent company, manages the bike shop in Moreland, various water activities and a retail shop.

To read more detail click here.

There are essentially four sets of documents which govern Palmetto Bluff. The most prominent and public documents are summarized below. In addition, there are many private contracts and documents which affect the governance and future of Palmetto Bluff, for which no disclosure is required.

1. The Development Agreement (DA): The DA is the overarching permitting document (sometimes referred to as the “PUD” for Planned Urban Development) which was submitted by Union Camp Corporation and approved by the Town of Bluffton in 1998. The protections in this original agreement served as the basis for the referendum of Bluffton residents to approve the annexation of Palmetto Bluff into the Town of Bluffton in 1998,. {read more—see #1 below}
2. Community Charter for Palmetto Bluff: These documents were first put in place in 2003 and have been amended at least 77 times. The Charter articulates the overall vision for Palmetto Bluff. Also, it establishes the Preservation Trust and chartered the Club as well as the Foundation. {read more—see #2 below}
3. Palmetto Bluff Club Membership: The Club was originally established by the Recreation Declaration in 2003 and set forth the initial structure and governance. The current Club Membership plan and the Rules and Regulations are available on the member web site {add link here} {read more—see #3 below}
4. Palmetto Bluff Foundation Form 990: As a not-for-profit entity, the Foundation (aka Conservancy) files annually this tax return, which are public. The filing documents the Foundation’s mission, revenues, expenses and board membership. Form 990s are filed annually; the 2020 form is the most recent available. {see #4 below}

To read more detail click here.

We believe there are three broad areas that property owners should all be aware of as PB continues to grow:

1. Living our Vision. Ensuring that the development remains faithful to the original vision, as best set forth in the preamble to the Community Charter (insert link). {read more—see #1 below}
2. Protecting valuable and relevant open space. While much of Palmetto Bluff will never be developed, very little land closest to the residential areas has been legally put into protected status. {read more—see #2 below}
3. Managing capacity and access to member amenities. Currently we are unaware of any plans to augment capacity in amenities, including pools, fitness/workout facilities, and restaurants. {read more—see #3 below}
4. Ensuring sustainable financial/economic stewardship. The complex legal and operational structure of Palmetto Bluff makes complete financial oversight impossible. That said, the by-laws of the Preservation Trust provide for access to minutes, and books and records. {read more—see #4 below}

To read more detail click here.

1. SSP is a private equity real estate investment firm, with a primary focus on the southern US.
2. The acquisition of Palmetto Bluff was done as a joint venture with Henderson Park. Per the press release:
   1. June 10, 2021 /PRNewswire/ -- Henderson Park Capital Partners ("Henderson Park") and South Street Partners ("South Street") have formed a joint venture (the "JV") to acquire Palmetto Bluff, one of the largest remaining contiguous entitled waterfront properties on the East Coast.
3. Henderson Park, which supplied most of the capital for the acquisition, is a private equity real estate investment firm based in London. Henderson Park is partially owned by Stone Point Capital, a well-established private equity firm, based Greenwich, CT.
4. The “holding period” for real estate private equity investments is typically six to eight years, given their need to return capital to their limited partners
   2. Consequently, we can reasonably expect that SSP will seek to market Palmetto Bluff to the next owner roughly between 2028 and 2030. Obviously, the state of the economy and the attractiveness of Palmetto Bluff will affect timing.

1. Property owners have two categories of rights.
   1. First, we have rights to receive basic financial information for the Preservation Trust and the Club. For the Club, we also have the right to audit the financials, at our own cost. {read more—see #3 and #4 below}
   2. Second, the developer (currently SSP) must develop Palmetto Bluff according to the Development Agreement and Common Development Scheme details in existence at the time of lot or home purchase. This second right is difficult to enforce, given the broad discretion granted to the owner. {read more—see #5 below}
2. Lack of transparency has led to significant property owners’ concerns regarding how costs are allocated and questions around whether PT assessments and Club dues are subsidizing Montage guests and developer expenses. {read more—see #6 below}

To read more detail click here.