AMDC Agreed to Sell Pascalis Properties for $5 Million. 

by Don Moniak

November 10, 2022

Without any public notice, the Aiken Municipal Development Commission (AMDC) has finally made public (1)  its December 3, 2021 Purchase and Sale Agreement (PSA) with RPM Development Partners, LLC (RPM).  However, the AMDC has yet to release the amended version of the PSA that was completed in June, 2022. 

The AMDC purchased the seven Pascalis properties on November 9, 2021  for a total of $9.5 million, using a grant from the City of Aiken from its August, 2021, $10 million municipal bond issuance. The PSA with RPM was signed on December 3, 2021 by AMDC Chairman Keith Wood, and RPM authorized agent Ray Massey.

The AMDC refused to disclose the proposed sale price for the properties and denied Freedom of Information Act (FOIA) requests for the PSA as recently as September 13, 2022–one day before RPM terminated the agreement. The AMDC also refused to release the PSA in early October, stating the process was ongoing. 

According to the PSA, the AMDC proposed to sell the Berkman Building on Laurens Street, the Hotel Aiken, the Holley House, Taj Aiken Restaurant, the McGhee Building, Warneke Cleaners, and Newberry Hall for a collective $5 million— a 47% discount from the AMDC purchase price that would have resulted in a $4.5 million loss to the City of Aiken.

Other portions of the PSA included requirements that: 

• The City of Aiken perform all changes to Newberry Street at no cost to RPM; including removal of parking spaces, relocation of southbound traffic lanes and stormwater drainage and other utilities. If the City of Aiken failed to agree to these terms, RPM had the right to require the AMDC to repurchase the properties for $5 million. 
• The AMDC maintain insurance policies on all the  properties  and “manage and operate the Property in accordance with past practices and maintain the Improvements and the tangible Personal Property in substantially its current condition and repair, ordinary wear and tear excepted, to be delivered in a broom clean condition at Closing.” 
• A Master Development Agreement be completed prior to closing that defined the purchaser’s requirements and set a repurchase price for the garage and conference center at $3 million. 

As reported in Portions Rescinded, But No Cancellation, RPM terminated the agreement on September 14, 2022, although that action was not publicly disclosed by the AMDC at the time. On September 29, 2022 the AMDC voted to render the agreement null and void, and commission members Keith Wood and Chris Verenes pinned blame for violations of South Carolina Community Development Law on unnamed “staff.” Since that time, longtime AMDC Executive Director Tim O’Briant was removed from the list of staff on the AMDC website.

In May 2022, the AMDC admitted that a “sole, one-time, financial incentive [for the developers] will be a discounted price for the property upon which they will build the hotel and apartments.” In light of the revelation that the discount was nearly a half-price sale, that statement might qualify as the top understatement of 2022 from the City of Aiken.

Feature Photo is taken from Exhibit A on Page 29 of the PSA.

Followup story: The PSA is Removed from the City’s Document Repository.

FOOTNOTE:

(1) The document appears to have been posted at the City of Aiken’s Laserfiche ecodocs document repository on October 21, 2022; filed under “other documents” in the AMDC folder.

The City of Aiken has yet to respond to the following FOIA request, filed on September 29, 2022:

“A copy of the unredacted version of the attached document, Pascalis offers comparison_Redacted, located at: https://aikenmdc.org/wp-content/uploads/2022/03/Pascalis-offers-comparison_Redacted.pdf 2. A copy of all documents related to “Pascalis proposal solicitation and RFP scoring“ not presently at https://aikenmdc.org/2022/03/29/project-pascalis-public-records/; including, but not limited to: a. All emails or other correspondence to prospective developers that accompanied the RFP package; b. All memorandums describing proposals; and c. All submitted proposals. Under SC Community Development Law, all records of the AMDC are to be made available for inspection. I am willing to inspect the files as is to reduce and eliminate search and retrieval time. SECTION 31-10-160. Availability of commission’s books, records, bylaws, rules, and regulations for public inspection; annual report of commission’s activities. (a) The books and records of a commission are at all times open and subject to inspection by the public.”