Recently obtained documents reveal the City of Aiken has declared no insurance value for the historic Hotel Aiken, and is paying an annual insurance premium of only $441 on the hotel. (1) The City of Aiken has provided no reason for the decision to leave the hotel nearly uninsured.
Hotel Aiken: No Value, Barely Insured
The City of Aiken’s Municipal Development Commission (AMDC) purchased seven properties at a cost of $9.5 million in early November, 2021. The purchase was funded by a bond issuance approved by Aiken City Council three months earlier. (2). Two of the properties, the Hotel Aiken and the adjacent Holley House Motel, were vacant at the time of the purchase. The combined purchase price for these two properties was $4.25 million.
The properties form a substantial portion of the proposed, but evolving, demolition and redevelopment endeavor in downtown Aiken called Project Pascalis. The project is promoted and led by the AMDC, which was formed in 2019 and has no prior, largescale institutional development experience.
After the original developer GAC, LLC (agent: Weldon Wyatt) exited from the project in May, 2021 for unknown reasons, the AMDC eventually selected RPM Development Partners, LLC (agent: Ray Massey) as its replacement in December 2021. The AMDC signed a conditional purchase and sale (PSA) agreement for the seven properties, pending a final master cost-sharing and development agreement. That PSA remains confidential and exempt from a Freedom of Information Act request. The AMDC has stated that it will offer “a discounted price for the property upon which they will build the hotel and apartments.” (3)
A request for proposals (RFP) leading up to RPM’s selection occurred in May, 2021 and was not publicly advertised as required by South Carolina Community Development laws. A legal advertisement for RFP’s was placed ten days after the selection of RPM. As a result, the legitimacy of RPM’s status as the developer has been challenged in court. (4)
The Hotel Aiken was placed on the city’s historic register in 2018. The designation remains despite the city’s Design Review Board (DRB) approval on March 1, 2022 of a demolition application from RPM for the hotel and the adjacent building titled 106 Laurens St, SW. The permission to demolish, approved by a vote of 6-1, is conditional, and demolition will not occur until RPM has a final agreement to purchase the property, has a final master agreement with the AMDC, and final designs are approved by the DRB.
In a document titled “Property Schedule,” attached to the first page of the property declarations portion of the city’s property insurance policy, no value is assigned to the Hotel Aiken. This zero value was assigned months prior to the demolition application being filed.
The annual insurance premium for the hotel is only $441, less than the premium for the average 1200 square foot home. The total insurance value is only $284,060, even though in 2021 the Aiken County Assessor appraised the market value of the land at $562,000 and the hotel improvements at $987,000 for a total appraised market value of $1.549 million.
Another way of looking at the value of the Hotel Aiken is by examining the offers the AMDC received in 2021. According to a redacted review of bidders (5) involved in the May, 2021 RFP process, one developer was rejected for only offering $1 million for the hotel property, described in the review as a “deeply discouted (sic) price.”
In contrast, the adjacent Holley House motel, which is also vacant and part of the Project Pascalis demolition zone, has an assigned value of $2.25 million and an annual policy payment of $3493. Every other building in the demolition zone also has an insurance value matching the AMDC’s purchase prices. (See Property Declarations Table).
When asked about the lack of insurance value for the Hotel Aiken, city officials declined to comment. The question as to why the AMDC spent more than $2 million on land and improvements, describe a $1 million offer as a “deeply discounted” value, and then chose not to insure the improvements against fire or other losses also remains unanswered.
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Coming Soon: Part 2: Less Protected: A before and after comparison of fire protection programs for downtown AMDC properties.
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(1) A Freedom of Information Act (FOIA) request was filed on July 11, 2022. The request was for:
“Copies of the Property and Building Insurance Policies for the following AMDC owned properties 121-21-09-001: 106 Laurens St 121-21-09-002 : Hotel Aiken 121-21-08-001 Holley House 121-21-08-002: Taj Restaurant + 121-21-08-003: Old Johnson Drug Store 121-21-08-004: Warneke Cleaners 121-21-08-004: Newberry Hall. These commercial property and building insurance policies should be readily on hand and retrievable within fifteen minutes.”
The City of Aiken responded on July 18 with a $16 charge for 1.25 hours of search and retrieval labor. After receiving payment on July 18th, the city waited until July 21st to release three documents:
| File name | Document Description |
| insuranceinfo.pdf | The Property Declarations page and the “property schedule.” |
| Property Schedule – Pascalis Project.pdf | A January 19, 2022 table of insurance values |
| SCMIRF-Property Coverage Contract 2022.pdf | The City’s Insurance Policy for city property. |
The insurance policy is titled “SOUTH CAROLINA MUNICIPAL INSURANCE and RISK FINANCING FUND COVERAGE CONTRACT 2022.”
Only a portion of this document, the “property declarations” chapter, was provided in the FOIA response. The city claims that the remaining portions do not apply to AMDC owned properties. Chapters detailing coverage declarations for liability, crime, and casualty coverage were considered unrelated to the request for entire insurance policies.
The issue is presently under appeal to Aiken City Manager Stuart Bedenbaugh.
The documents are are available at:
Hotel Aiken Fire Information – https://drive.google.com/file/d/1krYZVK5MrOVDOGxr_cAWzUpdyBhSmhJk/view?usp=sharing
Hotel Aiken et al property declarations – https://drive.google.com/file/d/1LGsW1ZOpzCD7vimEoEnepygtmQ2kf4nh/view?usp=sharing
Hotel Aiken et al and city insurance policy – https://drive.google.com/file/d/1Y29OaSyUmtBmUheZ-iq3BfME7_JM4kHs/view?usp=sharing
(2) A table showing the seven properties, the purchase values, and the county’s assessed values, can be viewed at: https://i0.wp.com/aikenchronicles.com/wp-content/uploads/2022/07/d117f8c8-47de-42c9-b18e-c928155e1e07.jpeg?ssl=1
“A Timeline for Project Pascalis” can be viewed at: https://aikenchronicles.com/2022/06/29/a-project-pascalis-timeline/
(3) https://aikenmdc.org/2022/05/16/just-the-facts-why-pascalis-how-do-we-pay-for-it/
(4) A lawsuit filed on July 5, 2022 challenging nearly all aspects of the Project Pascalis proceedings can be found at:
(5) https://aikenmdc.org/wp-content/uploads/2022/03/Pascalis-offers-comparison_Redacted.pdf