Wednesday, June 12, 2024

CB seeks agreement with amusement park landowner to bring back Ferris wheel

Carolina Beach town council wants to reach an encroachment agreement with amusement park landowner Carolina Beach Land Holdings LLC. (Courtesy Port City Daily)

CAROLINA BEACH — Many view the recently removed Ferris wheel as a landmark of the Carolina Beach Boardwalk — and town council wants to reach a new agreement in hopes of bringing it back.

READ MORE: CB upping parking rates to $6 an hour in lots, $7 in ‘premium lots’ to cover off-season break

Council agreed at Thursday’s meeting to authorize town manager Bruce Oakley to explore an encroachment agreement that would allow Carolina Beach Land Holdings LLC access to a small amount of town-owned property to operate the Ferris wheel.

The ride — overseen through a partnership between Carolina Beach Land Holdings LLC and Hildebrand Amusements — was temporarily dismantled Dec. 21 and moved to an undisclosed location due to a Jan. 1 expiration of a lease agreement between the town and Carolina Beach Land Holdings LLC. 

The Ferris wheel has been located at Carolina Beach Avenue S. on property owned by Carolina Beach Land Holdings for more than a decade. Yet, it doubled in size to about 95 feet in 2022 and needed to utilize a small portion of a 1,700-square-foot parcel adjacent to the firm’s property for one of the wheel’s support legs. 3 Carolina Beach Ave. South is owned by the Town of Carolina Beach, which drafted a lease agreement with the company.

Mayor Lynn Barbee told Port City Daily the Ferris wheel required at most 4 feet of public property, though the vast majority of the ride was located on Carolina Beach Land Holdings’ property. The town first entered a lease agreement with Carolina Beach Land Holdings in April 2022 to March 2023 and granted a short-term extension in May to last through 2023. 

Ken Cofer, the owner of CB Land Holdings who did not respond to PCD by press, previously expressed interest in making the Ferris wheel a permanent fixture of the Boardwalk. His business partner Matt Murphy requested the town enter a 10-year lease for 3 Carolina Beach Ave. South at $400 a month on Oct. 20 2023. Yet, WHQR reported that Cofer and Murphy pushed for longer, five-year leases as far back as October 2022. 

Murphy wrote in an Oct. 4, 2023 email to Oakley and deputy town manager Ed Parvin,  it would guarantee stability for the ride company. 

“Moving this equipment is time consuming and very expensive,” he wrote. “They cannot work for a one-year timeframe for planning purposes.”

Murphy said he was aware the town was considering using its parcel for equipment storage for a nearby bathroom renovation, but added Carolina Beach Land Holdings LLC would be able to help with the project. He said his company had “always worked with the town” on infrastructure and building improvements in the past.

In an Oct. 12 email, Murphy noted the company was interested in purchasing the property. Oakley responded state law would require an upset bid process and allow other entities to make higher offers.

Thereafter on Oct. 20, Murphy wrote the company wanted a 10-year lease  after Oakley presented options to explore, including an encroachment agreement, an exchange of equal pieces of property, a property purchase, entering a new lease for less than a year or entering a lease beyond a year — which would require a public hearing. 

The mayor said the property owner was negotiating with ride operators at the time of the lease deal. However, he didn’t believe enough coordination with public officials was provided to warrant a long-term lease below market value. The town did not reach an agreement with Carolina Holdings by the Jan. 1 expiration date, resulting in the Ferris wheel removal. 

Council members and town staff met Jan. 10 and considered the decade-long lease too long and potentially underpriced. The town pays almost twice that much in monthly debt service after purchasing the property for $337,500 in 2019. 

Thursday, council members settled upon the exploration of an encroachment agreement. This would allow Carolina Beach Land Holdings to use some of the town’s property without requiring a lease. Mayor Lynn Barbee expressed concern the original deal didn’t represent the fair market value of the property. 

“This is a no-win situation for us up here,” he said at the meeting. “Because we’re talking about leasing property to a for-profit entity.”

Carolina Beach Land Holdings is a real estate company and owns nine properties in the vicinity of the pavilion area of the boardwalk. Barbee told PCD they own the entirety of land forming the amusement park. 

Barbee noted the company had previously helped the town by leasing some of its property at the same price — $400 a month — for photo props a few years ago. He called to continue the relationship.

“From my standpoint it seems like there should be more sense of partnership here,” he said at Thursday’s council meeting.

The town manager agreed and told PCD they viewed the $400 monthly lease deal as a means of being a “good neighbor” and returning the favor to Cofer after the landowner rented his own property to the town for the same amount years earlier.

“But that favor was contingent on us working together and developing a plan up there,” Barbee said.

The mayor argued the Ferris wheel would only need a small amount of public property that could be provided for free with an encroachment agreement. An encroachment agreement, legally binding, consists of mutually agreed-upon rules for property owners’ intrusion onto a neighbor’s property. 

PCD asked Barbee why he would offer it for free rather than charge for it — primarily as the discussion happened at the same meeting council members made parking program changes. They voted to make off-season parking free but also increased rates in some areas in-season. Council member Jay Healy argued the increases are because the town needs more revenue to keep up with inflation.

“For me, it would depend on the amount of encroachment,” Barbee said about charging. “If it is very small and doesn’t impede our use of our property, then I would be open to a lower or no charge. We asked the town manager to investigate this and then bring a recommendation.”

He said he didn’t think the rest of council expressed an opinion about potential charges for the encroachment settlement. However, the town would benefit from the agreement by encouraging business activity in the central district rather than vacant lots.

“You want to draw tourists to the area,” he told PCD. “So we definitely want Mr. Cofer to put whatever — I mean, within his zoning — whatever he wants, but we really don’t want to see it vacant.”

Nothing has been set in stone per the encroachment agreement. Friday morning, Oakley emailed Cofer and Murphy to inform them council unanimously desired the Ferris wheel’s return via the encroachment. Oakley asked the business partners if they were open to setting a meeting to discuss a potential agreement.

“I think everybody wants the Ferris wheel,” Oakley told PCD. “It’s just how to make that happen.”

Beyond the town’s preferred encroachment agreement, Oakley told PCD a property purchase or a newly negotiated lease agreement were potential solutions. He noted the town does not yet have a long-term plan for the property, but in the short-term may use it for equipment and material storage.

During Thursday’s meeting, Mayor Pro Tem Deb LeCompte raised the possibility of the town gaining a percentage of profits from the Ferris wheel. Oakley told PCD he would discuss the option with legal counsel.

Oakley added CB Land Holdings rejected earlier encroachment agreements in favor of leases; the town manager deferred to the property owners when asked why this was their preference but said “maybe they felt they had more control.”

In addition to reaching out to Cofer, PCD attempted to contact Harlan Bast — the president of Hildebrand Amusements — to ask how the Ferris wheel was transported and is being stored, and costs of these procedures. A response was not received by press.

Questions to Cofer that went unanswered regarded if the company is open to an encroachment agreement, and how quickly the Ferris wheel could return if the parties involved were open to the negotiations.

According to Secretary of State records, Cofer is the registered agent for eight LLCS in total, including SECOF Commercial, Inc., where Murphy is also an owner and co-founder. Barbee and planning director Jeremy Hardison noted Cofer and Murphy also worked on construction for the mixed-use Towneplace development near the site of the former Ferris wheel.

“Cofer is a longtime Carolina Beach resident,” Barbee said. “Well-known, been here his whole life.”

Town Clerk Kim Ward told PCD Carolina Beach Land Holdings does not have any other contracts with the town. However, Oakley said the town has worked with Cofer on several projects that needed town review and approval; he said he was sure they’d worked together on “many things” prior.

“He’s a big businessman in town,” Oakley said.

Notably, the Ferris wheel isn’t Cofer’s only ongoing land-use dispute in the area; his company filed a lawsuit against the Town of Carolina Beach in November. It states the town uses some of its property next to the former Ferris wheel and challenges its claims to an easement.

PCD reached out to the town manager and legal counsel Charlotte Noel Fox for specifics about the easement’s location and how it was used by the town but did not receive an answer by press. 

In the November complaint, CB Land Holdings’ Attorney James K. Pendergrass Jr. of Pendergrass Law Firm, LLC, argued the easement rendered the property unmarketable.

Court documents obtained by PCD didn’t detail the town’s use of the disputed property, but the plaintiff’s exhibit labels a concrete road/sidewalk crossing the company’s land on lot ten of the parcel as “easement area.” Oakley told WHQR the suit involved “a portion of the eastern most concrete sidewalk in the Boardwalk area” adjacent to the Ferris wheel.

Murphy’s March 2022 permit application for the Ferris wheel lease included a shared use of sidewalk agreement with a site plan including the lot 10 sidewalk pictured in the suit. In the application Murphy wrote “amusement ride support leg” would be the proposed activity on the shared sidewalk. 

Asked about any potential connection between the easement suit and leasing dispute, Murphy told PCD “there’s no connection between the two” and he had “no further information on it.” 

PCD asked the town manager and mayor if the litigation put strain on the town’s relationship with the firm as it negotiated the Ferris wheel leasing agreement. Oakley said he tried to keep the issues separate and that he didn’t believe the suit hurt the parties’ relationship.

Barbee said he wasn’t “100% briefed” on the lawsuit, but believed issues weren’t directly related and the contention underlying the suit had been ongoing before current council members took office. 

“Anytime you have lawsuits between parties, it makes the relationship more complex,” Barbee said. “But I don’t think it’s really factoring into this Ferris wheel lease decision at all.”

Barbee said there was no “bad blood” and expressed frustration he’d seen the situation misrepresented on social media. He pointed to residents mistakenly believing the town owns the Ferris wheel and intentionally removing it, in contrast to the councils’ desire to see the amusement ride return.

“If we could just get a group of these people together, I think it would be a simple solution,” he said.

Ed Note: This article has been corrected to accurately quote Mayor Lynn Barbee’s use of the word “lawsuits” rather than “losses”. Port City Daily regrets this error.


Tips or comments? Email journalist Peter Castagno at peter@localdailymedia.com.

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