NEXSENIPRUET

Neil c. Robinson, Jr.

Member Admitted in SC

February 14, 2014

Mr. Richard H. Stewart Santa Elena Foundation 2015 Boundary Street, Suite 300 Beaufort, SC 29902 Dear Mr. Stewart: Your letter of February 13 is noted; however, strong exception is taken to your conclusions and false allegations of poor and irresponsible behavior by the S.C. State Po1is Authority. You state that you have "some real estate experience", which allows
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you to "state the obvious". What is obvious is that you have failed to do your homework with respect to the Port Royal Prope1iy and the diligent efforts to sell the same since mandated to do so by the State Legislature. The property was originally appraised and offered as three distinct tracts: the Pmi Village, the Marina Tract, and the Bluff Neighborhood. No qualifying bids were received for any tract. Since then, the three tracts were offered
as

a package, which

over time resulted in separate contracts with three development groups, each of which was approved by the State Budget and Control Board. Each of these groups engaged in thorough due diligence of all aspects of the property, yet none of these transactions closed. This was due to no fault of the Seller, and resulted in substantial sums of earnest money being forfeited to the Ports Authority. I don't believe for one minute that you don't fully understand and appreciate why your offer is non-conforming. You are looking to cherry pick a prime location in the Port Village Tract, which could result in a diminution of value of the remainder of the Tract. The rejection of your offer is no different than the seller of a residential property rejecting an offer to buy the front yard of the house. There has been no subdivision or appraisal of the individual cut that you want, and the public has not

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T 843.720.1723 F 843 4 . 14 .8216 E NRobinson@nexsenpruet. com

Nexsen Pruet, LLC

Attorneys and Counselors at Law

NPCHARI:l268669.1-LT-(NCR) 024000-00223

February 14, 2014 Page 2

been offered the parcel in the special manner you proposed to us in our January 17 meeting. You further seek to low-ball the value of the sought after parcel by making elaborate, unfounded allegations of environmental concerns. Again, the record is clear that three groups have performed significant due diligence, including environmental assessments, which have not disclosed any known material adverse environmental concerns. The asking price for the property is not unknown: it is posted on the NAI Avant website. The recent decision to again offer the property as the three original separate tracts reflects the cunent real estate market in which it is more likely to find buyers with distinct interest in a given product than in a master planned development. The Ports Authority is not a developer, however, and does not intend to further subdivide the property for smaller specific uses, such as what you described for the Santa Elena Foundation. If you are interested in making an offer on the Port Village Tract, then you should contact NAI Avant. I will caution you, however, that the Ports Authority Board will not take kindly to the disrespectful and untruthful allegations contained in your letter of February 13 . It belittles you and your Foundation.

NCR/pdp cc: Colden R. Battey, Jr., Esq.

NPCHAR1: 1268669.1-LT-(NCR) 024000-00223