A SHROUD OF FOG – A SHROUD OF GOLD DUST

Hilton Head Island was wrapped in a shroud of fog several days ago. Cold ocean water from the rapture of the deep moved by upwelling met warmer air from our landmass, creating fog. Shortly after, a blanket of pollen that looked like gold dust covered the island.

While temperatures in colder climes plunged into the teens, single digits or below, our island temps were often in the balmy 60’s and low 70’s with beautiful sun-filled days. The weather complimented a variety of events, not the least of which was the vast, changing salt marshes which were transforming, the changes in mud and grasses mostly unnoticed by the human eye. Early nest builders like the Bald Eagle gathered the breaking brown cord grass, gathering stalks for their nests. Occasionally, according to local master naturalist, Captain Patte Ranney, large white pelicans (related to our more common Brown Pelican) stop in our area while migrating this time of year from the Gulf to Canada. Normally they fly high overhead and are not observed at all. Consider it one of nature’s gifts if you ever see them.

A Lowcountry native, I never especially noticed the rust-colored marshes in the fall. One year an artist came to Hilton Head to paint some representational paintings for a local gallery. Among his work were a few rust-colored marsh scenes touched with umber. Now when I see rust and umber colored marsh I think of the artist, Harvey Kidder. Artists teach us about the world we live in; art informs the spirit. Hilton Head has long been an artist’s paradise. One of the largest membership groups on the island is the Art League of Hilton Head. I was involved in the group early on and served on the board for 16 years. Most of the artists I’ve met over time tend to be not only creative but interesting and gentle people.

Among the many art galleries on the island is the highly regarded Red Piano Gallery, co-owned (Morris-Whiteside) by Jack Morris, the former director of the Greenville County Museum which has one of the finest collections of Andrew Wyeth paintings in the United States. At one time a former owner of the gallery, Louanne LaRoche, featured the works of the famous Seattle-based glass artist Dale Chihuly, who has been designated a National Living Treasure. His work is in museums and collections all over the world. One of his fascinating installations took place in Venice, Italy. It consisted of 14 temporarily mounted enormous chandeliers over the canals and in the palazzos. It was a thrill to see his work here.

The annual Hilton Head Island Wine & Food Festival, fashioned after a popular wine special event founded by the Wall Street Journal, was held toward the end of January. The non-profit’s proceeds from a Silent Auction benefited educational opportunities for students in the Hospitality Management study programs at the University of South Carolina Beaufort and the Technical College of the Lowcountry. This effort is also supported through the John F. and Valarie Curry scholarship Fund.

Another popular event was the Lowcountry Soup Challenge, held at the elegant Westin Hilton Head Island Resort & Spa. Numerous restaurants were involved (we have over 200 restaurants). The Challenge helps fund the island’s non-profit Volunteer’s in Medicine, a free health clinic. First place was awarded to Hugo’s Seafood and Steak House for their Crab and Asparagus Cappuccino Soup with hazelnut broth and asiago cheese crackers. One year a former New Orleans resident, Ken Ballard, the owner of Kenny B’s French Quarter Café took first place with a Swamp Critter Stew. The chefs have a lot of fun with this “challenge”.

Some of our Indian Summer days brought out people wearing shorts and flip flops, fishing with long cane poles in a tributary off of Broad Creek in the shadow of Shelter Cove marina where sea-going yachts and sleek fishing motor yachts pulled at lines. An influx of our No. 1 real estate market, the Canadians, descended on the island, taking advantage of the exchange rate and low interest rates, driving more real estate sales.

Sales results of 2012 compared with 2011 show solid gains throughout the island. With closed sales up 10% to 177 the average price in Sea Pines is up 7% to $907,213 compared with $853,245 a year ago. Current inventory is 188 with homes averaging 93% of list price. We have clearly seen the recovery in residential sales island-wide continue.

The big winner in 2012 was villas with an exciting 20% jump in sales and a 3% increase in selling price. Inventory was down 10% from 2011. This positive trend is expected to continue in 2013 with strong sales, attractive prices and amazing interest rates.

The Sea Pines Resort had a phenomenal year in 2012, with an increase in occupancy, revenue and rental rates across the board. Home and villa revenue was up 16% from 2011 to 2012! This year we are off to a great start with future bookings 11% ahead of where we were last year. We are anticipating another banner year!

Showers of Stars Fell Over Hilton Head Island

Adding to the excitement of the holiday season were meteor showers!  As the Earth crossed the orbital Temple-Tuttle bits and pieces from this comet burned up as Leonid meteors in the Earth’s upper atmosphere.

The Leonid shower produces some of history’s most spectacular displays.  Many islanders, as well as other earth-bound creatures, were up early to witness the event. The showers are easily observed over Hilton Head, unlike cities where tall buildings and an abundance of lights block the stars.

Holiday productions such as “The Nutcracker” enchanted viewers; Christmas parties were in abundance.  One in particular creates a special ambience each year.  It is hosted by Kate and Russ Keep, popular, long-time islanders who enjoy entertaining.  In some homes it is easy to see “pride of place” manifested in the way things are done, as well as great attention paid to detail.

For this annual party, guests entered a private courtyard through large wrought iron gates decorated with entwined vines of colored Christmas lights.  A stroll past blazing torches led into a home decorated with live greenery: greenery swags caught with red bows at windows, a large beautifully decorated Christmas tree, a fire burning in a fireplace lined with antique metal fire plates depicting scenes of gaiety.  The plates reflect the heat out into the room, an important feature before central heating.  Servers offered champagne and later, passed trays of hors d’oeuvre.

Even a cursory look at this home tells the viewer that the owners are incurable collectors.  World travelers, they have a fascinating collection of treasures:  Flemish tapestries hang on walls; antique furnishings add a soft, burnished glow.  There is a Tuscany wine-tasting room complete with stucco-swiped walls and old wooden ceiling beams; a statue of Bachus, the Roman God of wine, looking down from high in a corner with his horns and hoofed feet.  In the center of the room is a “wine jail,” a wrought iron Spanish-looking safe holding a gross of bottles under lock and key. 

On the rear patio, pine logs burned popping and shooting up sparks from a Chiminea, warming the crisp but still mild air.  Guests like to gather here, under the stars, near a Koi pond and a bubbling waterfall.  Beyond is a natural wooded area and a mature stand of Black Bamboo.  Later, after a sumptuous buffet featuring fried turkey, Kate played her mother’s Baby Grand piano, which she learned to play as a young girl.  When guests finally departed they were filled with Christmas spirit!

International travel is impacting the United States.  The National Association of Realtors Global Research Report for 2012 reports that international buyers purchased $83 billion dollars of U.S. real estate last year.  Hilton Head has been a prime destination for international travelers for many years.  We’ve had many buyers of island properties from other countries, especially England.  The island is a top destination for Canadians who comprise our Number 1 market in sales to international buyers.  Sales are up 24 percent of international sales, up from 11 percent in 2007.

Nancy Kemeny was on-island from London, England before Thanksgiving.  Her husband, Tom, stayed in their London home to attend to business while Nancy enjoyed their Hilton Head home, which they have owned for many years.  The family later met at another home in Barbados for Christmas.

Dana and Diederik Advocaat, accompanied by their teenaged sons Alexander and William flew from their home in London, England to spend the holidays on Hilton Head.  The family usually vacations here in the summer and has for many years.  They plan to retire here.

Katherine and James Kapps enjoyed their second “retired” Christmas in their beachside home.  Long-time property owners, they moved to the island from northern Virginia.   Their close friends, the Shirley Beavers, have also moved here and live a couple of houses away from the Kapps!  Katherine Kapps’s sister, Jeannie Lawrence and her husband, Mike, live not far away.  They moved from their Nashville, Tennessee home many years ago to enjoy the island lifestyle.  In the “small world” department, Jeannie’s childhood friend from their early days growing up in Greensboro, N.C., Andy Sonfield and her husband, Bob, live on the same street as Jeannie and Mike!

Bloomberg Business reports that home prices climbed more than forecast in October, indicating a rebounding real-estate market that will bolster the U.S. Economy for the first time in seven years.  On Hilton Head we’re still seeing cash buyers coming into the market, purchasing big-ticket properties as well as lower priced inventory.  One of the most popular price ranges appears to be the $500,000 range but $3 million to $6 million isn’t unusual either.  Regardless of who is buying or what the price is, the purchaser finds the restorative power of Hilton Head an added bonus.

Hilton Head Island's Changing Tides

As the summer winds down on Hilton Head, vacationers begin packing up to make the trek back to homes in other states. Some will have come from South Carolina or other nearby areas. They are called "the grits and gravy crowd." Vacationers who visit in the winter when it is too cold to get on their golf courses at home are called "the jet set". At the end of summer, the younger set have finished such activities as Crabby Encounters, Shark Tooth Necklace making, Sand Dollar Painting, Tie-Dye Fun, beaching, fishing, dolphin cruises, evening campfires in the Sea Pines Forest Preserve where ghost stories shiver young timbers and of course our favorite Alabama produced singer Greg Russell's dynamite concerts under the Liberty Oak near sleek yachts that rock gently in the famous harbor's placid waters. The tall, candy-striped lighthouse stands quiet guard over this colorful, fun, beautiful place.

Hilton Head's strong home sales in 2012 continued in July with a greater improvement rate over July 2011 sales than any of the state's 16 regions. We've seen four years of continued growth since the market bottomed in 2008. In Sea Pines alone, comparing the first six months of 2012 to all of 2011, residential sales are up 13%, villa sales are up 62% while lot sales are up 42%. Since there are so few lots available for sale, the best having been built on years ago, many buyers simply purchase an older home and long-term rent it until they are ready to tear it down and build. If it is close to the beach and in good condition, it can short-term rent by the week. Long-term rental properties are in short supply on the Island so this is a great time to buy (lower prices and low interest rates).

With 104 closed home sales in Sea Pines (if I seem to focus on Sea Pines, it is because I've lived here, by the beach, for over 40 years) in the first 7 months of 2012, the average price is up 5% to $926,728 compared to $880,120 a year ago at this time. The villa market has always been a hot market on Hilton Head until a couple of years ago. Now villa sales are up dramatically all over the Island with Sea Pines seeing a huge jump with 74 sales compared to 46 last year. Currently there are only 114 villas listed for sale compared to 161 in 2011. Naturally the lower priced inventory has been selling resulting in lower priced villas being cleared out. The same is true with homes although now we are seeing higher end homes selling, many for cash. Buyers feel that Hilton Head is a good place to put their money. Foreigners obviously feel that way since sales to them in this country have increased 24% in 2012 reaching $82.5 billion and growing. We've seen buyers from Russia, Italy, England, Germany, etc. coming to the Island.

The Hilton Head Town Council has been considering plans to use town land and money to create a new commercial district in the Coligny area near the beach. Plans first included a hotel, parking garages, a new park and new plazas with outdoor cafes, shops and restaurants (some of which are already there). Condominiums or apartments would occupy a second story above the retail space. Now comes a decision not to subsidize or support redevelopment of viable existing commercial enterprise or install public improvements. Instead, funds from a tax-increment finance district will be used to improve parking in the Coligny area, adding green space, upgrading nearby streets and establishing a presence for the University of South Carolina Beaufort's new center for event-management and hospitality training. There is also a new University of South Carolina Beaufort Gateway Campus across the bridge from Hilton Head, near Sun City that includes a nursing school

The current Hilton Head center is operated by USCB in space rented from Sea Pines and offers credit and noncredit courses as well as certificates and training for industry professionals. About 60 USCB students were enrolled for the spring semester, and the center has trained more than 360 hospitality workers. Chancellor Jane Upshaw calls it "a wonderful success" and says, "We have plans to expand the program to include coastal ecology, island environment and sustainability and offer more seminars."

She said the university had discussed plans for a campus on Hilton Head that would serve about 200 students and offer extended learning courses for residents and retirees through Osher Lifelong Learning Institute. The plan would have a sustaining appeal to seniors with on-going learning for younger people as well as filling unused rental units during the off-season. The plan accomplishes giving the Coligny area a unique identity while recognizing why it is residents live there, which is because of the forest and the beach.

The Heartbeat of Hilton Head

Summertime on Hilton Head is filled with long, languid afternoons, the smell of the sea, a line of pelicans skimming over the ocean while pounding surf breaks on the beach - the heartbeat of Hilton Head.

Loggerhead turtles are nesting now. It is an annual rite dating back thousands of years. They lay their eggs in a depression on the beach from may to mid-August. The eggs hatch from July to October. By mid-June, 89 nests had been reported with more to come, according to the seaturtle.org website. Owners of beachfront properties are cautioned to turn off outside lights from 10 pm until dawn in order for these unique creatures to find their way to the ocean and not, by being disoriented, end up on someone's lawn or in a swimming pool.

While turtles were nesting in June of 2012, a report from South Carolina Realtors showed sales were up more than 60 percent over the same time last year, with 21 percent less time on the market. These numbers reflect a much healthier market than a year ago. Buyers are making their moves and sellers feel they have waited long enough to sell. The average home price island-wide is now $653,206 (in Sea Pines the average price is $941,207). This is not to say there are not some very good buys in the lower price ranges. One house in Sea Pines that sold a few weeks ago for a low $385,000 is in a neighborhood of nice, large homes, has a lovely lagoon view with open space on one side; lagoon views from a kitchen-great room/fireplace and master suite; an open foyer, spacious interior with a separate dining room and a two-car garage. It is less than ten minutes by auto from the beach. The buyers have been vacationing on Hilton Head for twenty years. It took them less than a full day to make a decision about this house. Now they're "living the dream."

Owners of high-end properties who want to sell are anxious to complete a transaction before the end of this year because, if the Bush tax cuts are allowed to expire and tax rates go up, sellers in the high-end market could owe hundreds of thousands or even millions of dollars more in capital-gains taxes. If more wealthy property owners sell, they could drive up inventory and lower prices at the top-end of the real estate market. The market experienced a similar situation in 2010 when it was feared that Congress would raise capital-gains rates. Inventory rose and prices decreased. Families who sell a second home that they have owned for more than a year pay capital-gains on the difference between the sale price and their original purchase price, minus improvements, certain fees and other deductions. There will also be local taxes and state taxes applied to the gains. All of this combined makes a good case for some wealthy owners who see a significant potential tax savings.

The upside means more affordable upper-end homes, especially for some foreigners, who continue to purchase real estate in this country as stocks and other financial purchases weaken.

Buyers are more focused on purchasing rental properties this year as the rental market tightens. Rental rates are being pushed up. Some rental companies have prospects waiting for nice rental properties. Often a buyer can close on a property one week and rent it the next. This is a far cry from a year or two ago as economic realities have swollen the ranks of renters. According to the U.S. Census Bureau, the population of 20-34 year olds (a prime renter demographic) will grow every year between now and 2030. With a record fall in interest rates on June 19, 2012 (to 3.53%), an exciting opportunity is afforded today's buyer.

While the lazy days of summer play themselves out, residents and visitors alike gather at Honey Horn Plantation on Friday mornings to peruse the local Farmers' Market where produce has been plucked from the vine in the early morning or late afternoon before and seafood was swimming in the river only hours earlier. The exotic smell of Palm Key smoked barbecue mingles with more earthly fragrances (including a nearby pasture with two snorting horses). Other edibles are organic hen eggs, quail eggs, artisan breads, gourmet soups - and don't forget the fresh peaches for a peach pound cake or fresh peach ice cream!

May is Pink Sunsets, White Gardenias and Serious Money

When gardenias are blooming, Southern girls wear them in their hair. When the spring polo match is played at nearby Rose Hill Plantation on the mainland, pretty girls hot-walk ponies. On Hilton Head Island, May is pink sunsets, white gardenias and serious money.

A couple of weeks ago, an equestrian exposition and polo match, presented by Equus Ventures, LLC and led by Chairman Dr. Sandy Termotto, was held at the Rose Hill Plantation Equestrian Center where Hall of Fame horse racing jockey Eddie Maples and his wife, Kate, manage the center. Visitors to the center come from as far away as Dubai. The exposition competition involves gated horses such as the American Saddlebred, National Showhorse, Arabians, the Tennessee Walking Horse, the Missouri Fox Trotter, Morgans and others. Riders are attired in elegant riding habit. There is a Lowcountry Hunt demo, a Parade of Breeds that might include Paso Fino, Appaloosa, Shire, Hanoverian, Friesian, Thoroughbred, Selle Francais, Arabian, Palomino and Quarter Horse. Spectators see colorful carriages, enjoy creative tailgate picnics and better understand the powerful bond between horse and rider. The surrounding woods showboat with blooming white magnolia blossoms.

Eddie Maples was aboard the famous Secretariat ("Big Red") when he rode to victory in the Canadian International Champion Stakes.It was the revered horse's last race. Eddie has won 4,398 races including wins in the Belmont Stakes twice. He has competed in nine Kentucky Derbys. This event and others has raised over $215,000 to benefit local charities.

Serious money (serious to us) has been pouring into the Hilton Head real estate market this season. Five oceanfront homes in Sea Pines have sold and closed. One priced at $5,500,000 sold for $4,600,000; another priced at $4,900,000 sold for $4,550,000; another priced at $3,995,000 sold for $3,500,000. Occasionally we see an older oceanfront home sell in the $3 million range, then torn down to make way for a new oceanfront home. One buyer of a large, vacant oceanfront lot paid $9,600,000 and is building a handsome, spacious second home. He lives in Europe. Since the Island is close to build out, we often see interior older homes in a prime location costing close to $1 million purchased and torn down with a new home to follow. Many of these are second homes. One lovely home that is for sale, priced at $4,200,000 with 135-feet on the ocean, is only a couple of houses away from an oceanfront home formerly owned by author Patricia Cornwell.

In Wexford Plantation, an elegant mid-island development with British Colonial architectural influences and a large harbor for owners' yachts, there are a number of homes for sale in the $1.7-$3 million-plus range with owners who have already purchased another home in Wexford while prices are low. This means their properties are priced lower than what was paid for them but that doesn't bother the seller. It also means the current owner is paying two Property Owner's Assessments. Not to worry. They all love Wexford, its beautiful white, sparkling clubhouse, the safe harbor where they can access nearby rivers and the Atlantic Ocean. It is a very special community (originally developed by Marathon Oil).

Millions of dollars are being spent on renovations of existing oceanfront hotels on Hilton Head: The Westin Hotel and Spa, the Omni, Holiday Oceanfront and The Crown Plaza (now the Sonesta).

While all of this has been going on, two nature events are playing out on South Carolina's barrier islands with the arrival of two endangered species, drawn simultaneously by our warmer spring waters and the moon's cycle. One is a tiny shorebird called the Red Knot that weighs less than an iPhone, and a living fossil of the ocean floor that has been in our geological records for over 350 million years. It is the horseshoe crab. The female crab will beach at high tide and lay around 64,000 eggs in shallow water. The Red Knot will have flown four days and nights nonstop over the Atlantic Ocean from their wintering grounds in Chile and Argentina (some 18,000 miles every year) to their breeding grounds north of the Arctic circle in Canada and back. The Red Knot has only two weeks in which to double their weight.

Unfortunately, there has been a major decline in the horseshoe crab population (as well as the Red Knot) due to a quart of their blood selling for $15,000. The blood contains a compound called Limulus Amebocyte Lysate (LALO) that immediately clots around viruses, bacterial endotoxins and fungi. It is the equivalent of liquid gold for biomedicine. It is a $50 million dollar a year industry in the U.S. Serious money.

Diann Wilkinson