Real Estate - Commercial

Surf City Agrees To Pay Developers $3.6M For Infrastructure

By Emma Dill, posted Nov 21, 2023
A site plan shows the nearly 400-unit Applewood Trace neighborhood planned for Surf City. (Image courtesy of McKim & Creed)

Surf City leaders entered into a $3.6 million economic development agreement Monday with the developers of a subdivision that’s drawn significant pushback from neighbors.

The agreement with the developers of Applewood Trace lays out specific infrastructure improvements developers will build and then turn over to the town of Surf City upon completion. Town manager Kyle Breuer said, to his knowledge, the economic development agreement is the first one Surf City has entered into.

“The town pursued the agreement recognizing certain benefits tied to the Applewood Trace development that advanced the town’s land use planning objectives and policies, securing quality growth and the strengthening of the town’s tax base,” Breuer wrote in an email to the Greater Wilmington Business Journal.

“It also provided the ability to increase the town’s ability to provide sewer services, employment, and business opportunities, and lastly, it allowed an increase in active open space within the town for the residents of the project.”

Before green-lighting the agreement on Monday, the Surf City Town Council unanimously approved rezoning an approximately 195-acre tract between U.S. 17 and the Villages of Turtle Creek neighborhood. 

The rezoning allows plans for 181 single-family homes and 218 duplexes and townhomes to move forward. The project is also set to include a clubhouse, pool and an RV and boat storage area along with a “small retail use portion” near U.S. 17. 

The rezoning has been a long time coming for developer Turtle Creek Ventures LLC. Last fall, an initial iteration of the project featuring more than 700 units, including an apartment complex and a wastewater facility, was withdrawn after town leaders indicated they would vote it down.

Revised plans were again rejected by the Surf City Planning Board in February following concerns about the project’s density. In May, the new scaled-back plans won approval from the board. The new proposal eliminated the apartment complex and wastewater plant. Despite the downsizing, the plans still draw some of the same concerns from Turtle Creek residents. (A rendering of a proposed home is shown below.)

On Monday, several residents voiced concerns about the impact hundreds of new homes could have on traffic traveling through their neighborhood and the congestion it could cause. They also raised concerns about the capacity of local infrastructure and area schools.

The town council deliberated on the conditional rezoning for more than two hours Monday before unanimously approving it with 13 conditions for the developer.

The developer will pay for, install and construct a new 8-inch force main that runs approximately 17,500 linear feet from the town’s existing wastewater treatment plant to Applewood Trace, connecting to the about 200,000 gallons per day “subsurface disposal area to be constructed by the developer,” according to the agreement.

The agreement states that construction of the infrastructure is expected to begin within three years and that the improvements will be “substantially completed” within the next five years. Once complete, the wastewater infrastructure will be conveyed to Surf City.

“This makes it so all infrastructure becomes town property,” Surf City Public Utilities Director David Price said Monday. “Based on a recent bid from a similar project, Surf City is projecting the infrastructure work outlined in the agreement to exceed the economic agreement offered.”

The $3.6 million will be given to developers upon completing the infrastructure improvements and the developers' payment of all sewer system development fees. The money will come out of the town’s general fund.

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