Yahoo Finance Exclusive: Myrtle Beach’s closed speedway is redeveloping into massive townhome community
When Myrtle Beach Speedway closed in 2020, it meant an end to racing at the Carolina Forest racetrack.
Famed NASCAR drivers like Dale Earnhardt Jr. and the late Florence County native and Hall of Fame driver Cale Yarborough competed at the track in its more than 60-year history. Although the people who sat in its grandstands and watched races still hold the memories of the contests that took place there, the closure marked the end of an era.
Now, the property begins a new one, as developers plan to convert the former racetrack into a massive townhome community in the Carolina Forest area. Initial site work and tree clearing have already taken place.
The former speedway is split into two main parcels, according to Horry County Land Records. The national home-building company Lennar owns part of the former speedway property, which is about 14 acres large. According to Horry County Land Record’s map of the property, the Lennar tract of the former speedway is subdivided into about 175 individual parcels.
Lennar’s Myrtle Beach office did not return a request for comment before publication.
The other parcel, roughly 21 acres, is owned by Speedway Villas Holding LLC C/O Jason Joseph. According to Horry County Land Records, Speedway Villas Holding LLC acquired the land for about $7.9 million in 2022. Trilogy Investment Company controls the LLC, as Joseph is the firm’s chief executive officer and managing partner. The firm has properties throughout the Carolinas, Georgia, Florida, Texas, and other states, containing about 3,500 lots.
In an interview with The Sun News, Joseph said Trilogy’s portion of the speedway will feature 226 townhomes, and the estimated total cost is more than $55 million. Townhomes will range from two-bedroom and two-and-a-half-bath units, about 1,200 square feet, to three-bedroom and three-and-a-half-bath units, about 1,400 square feet.
Joseph added that the townhome community will be called Rêve at Champions Point and projected that the first homes on the property will be completed in late 2025.
While townhomes aren’t new to the Grand Strand, particularly in Carolina Forest, Trilogy’s community is part of a growing trend in nationwide development. While Joseph said the Lennar portion of the former speedway will be for sale townhomes prospective residents can buy, Rêve at Champions Point will be a built-to-rent community.
Built-to-rent communities feature homes that people can rent but not purchase. They typically feature amenities for residents like a traditional apartment complex but with more personal space. Indeed, built-to-rent communities have already opened; in 2023, The Cottages at Myrtle Beach near Carolina Forest’s Lowes Food began signing tenants.
Trilogy specializes in built-to-rent development, and Joseph said Rêve at Champions Point will feature amenities for swimming and a clubhouse.
Joseph said the built-to-rent community typically attracts customers in the 55-year-old and older age range, and usually, more than 50 percent of a community fits this demographic, he added. However, it also caters to young professionals or single parents. He said that recent consumer trends towards renting instead of buying homes, coupled with Myrtle Beach’s status as one of the fastest-growing areas in America and lower cost of living compared to other top destinations like Florida, is driving the built-to-rent surge.
“People are moving there and renting by choice not because of affordability necessary of buying but because they want the flexibility of movement,” Joseph added. “You’re creating community; you have the benefits of home life. (Built-to-rent) give you the lock and leave flexibility as well.”
Trilogy’s foray into Carolina Forest isn’t the company’s only holding along the Grand Strand; the company also owns the Rêve Park Ridge townhome development in Little River, S.C. Joseph said Trilogy wants to continue developing properties along the South Carolina coast down to Savannah, Ga.
“We’re looking at that whole corridor there that we still are seeing tremendous growth,” Joseph said. “We are huge fans of Myrtle Beach.”
Interest rates still impacting development and real estate in the Myrtle Beach, SC area
While Trilogy plans to deliver its first units to the market by 2025, interest rates have impacted its efforts. Joseph said the company decided to halt work on the project, with civil construction expected to start in the third quarter of 2024 due to high interest rates.
Trilogy isn’t the only firm feeling the brunt of higher inflation and the cost of borrowing. High interest rates have also impacted Myrtle Beach’s real estate economy. In 2023, home sales dropped along the Grand Strand compared to previous years, as lending became more expensive and prospective home sellers opted to wait before putting their homes on the market.
Although home sales dropped during 2023, the pace of new construction didn’t, as new homes helped provide supply for the area’s real estate economy. However, construction is not immune to difficulties either, as the rise in the price of certain building materials also impacted the market in 2023.
Meanwhile, the current interest rates and inflation have caused some investors like Joseph, who are optimistic about Myrtle Beach’s economic potential, to take a more conservative approach in the short term due to the current climate.
For Joseph, the concern regarding construction costs has dissipated somewhat; however, the current economic climate impacts developers and has delayed other building projects.
“When you tack on the underlying cost of the debt, it creates some obstacles for certain projects to get going,” He said. “We have absolutely not been immune to that, like 1,000 other developers like us. So I would say that we’ve been very innovative in our approach and how we get projects done, financed (and) etc.”
According to the Federal Reserve Bank of St. Louis, the United States Federal Reserve’s Federal Funds Rate, the percentage that commercial banks lend and borrow between institutions, is currently 5.33 percent.
The Federal Reserve Bank of St. Louis lists the 30-year Fixed Rate Mortgage Average at 6.87 percent.
