Tucked away behind Lowes Foods and the Lewis Grand Apartments you will come across a sprawling new housing development in Carolina Forest.
When you drive down the road a clubhouse is one of the first things you lay eyes on when you enter the new community. It has a gym for fitness enthusiasts, a comfortable pool sits behind the building— white sun loungers rest in the water— and amenities like a dog park and washing station are planned for the future.
Around the clubhouse are streets lined with finished and under-construction one, two or three-bedroom cottages, most having a backyard. The Cottages at Myrtle Beach opened June 21 and have already attracted new residents. As many as 25 potential occupants tour the community in a given week Property Manager Meg Grant said, who lives at The Cottages herself.
But these cottages are not for sale. The Cottages are an entirely built-to-rent community akin to an apartment complex but with more living space between tenants. “Horizontal apartments” as they’re sometimes called because they resemble single-family homes, are a growing real estate trend nationwide, and Myrtle Beach has been at the vanguard of the move.
“In terms of developments, when you ride by it looks like the neighborhood that you grew up in, but you can’t buy a house in that neighborhood, because they’re all for rent. That is new,” Horry County Assessor Larry Roscoe said.
Myrtle Beach developers built 383 said homes in 2022, the seventh most of any American metro area that year, a decade high according to the rental data and blog site RentCafe. For comparison, there were nearly 2,000 apartment units built Myrtle Beach in 2022, according to CoStar Insight.
One of the local developers is Commercial Real Estate Agent at Berkshire Hathaway Home Services Myrtle Beach Tony Chestnut.
The Builders Behind Built-to-Rent
A 30-year veteran in real estate, Chestnut finds properties for future built-to-rent residential areas and helped pick the property that became The Cottages. For context, Chestnut has brokered about four deals, roughly 1,000 housing units total, and has two more projects in the works that could produce as many as 550 more.
Chestnut said he began working on built-for-rent projects after spotting demand for such properties. Projects like these are also attractive for developers because the units provide steady streams of income akin to an apartment complex as opposed to trying to build several single-family homes at once, Chestnut added.
Built-to-rent ventures can be cheaper to build, easier to control costs and an attractive investment property, Chesnut added.
The Cottages at Myrtle Beach were built by Capstone Communities and cost them about $60 million to build, according to company Vice President Davis Maxwell. Originally, the company specialized in building and managing student housing, but shifted its business model in 2018-19 to target a different customer base.
Capstone built its first cottage in 2007, and the company has complexes built or under development in Summerville and Charleston South Carolina. In total, the company has 10 more communities in the works, almost 2,700 individual units, mostly located in the Carolinas and Georgia. The Cottages is Capstone’s first property in Horry County, and the company has no current plans for future development in the area, Maxwell said. The new style of living is attracting all different kinds of people, He added.
“What we’re experiencing in other projects that we’ve recently delivered across the country is that the demographic of the tenants is broad,” Maxwell said. “We have empty nesters, we have those looking to downsize. We have recent college grads or young professionals that are wanting a place to live, and we have everybody in between.”
The Cottages is one of the newest such neighborhoods. Rents range from $1,800 a month to around $2,400 a month, and the development is 20 percent pre-leased, with 22 residents already living there. Forty-eight cottages have been completed of the 294 total planned, and 22 more will be added by the end of July, Grant added.
“We’re seeing people who are moving here, either for jobs, or they’re moving to be closer to family members, or we’re seeing retirees,” Grant said. “So it’s kind of running the gamut.”
The selling point for new tenants, Maxwell added, was the various amenities communities like The Cottages offered. The units do not have any common walls like more traditional apartments.
“You don’t have someone living beside you, below you, above you or even under you,” he said. “It’s perfect for people that want the space and privacy of a house but with all the amenities and convenience of an apartment.”
Organizations like the Coastal Carolina Association of Realtors like the growth of these new rent-only houses too because they help buttress the housing supply in Horry County.
“In our area, with explosive growth and a large influx of new residents, rental properties can help bridge the gap to home ownership while waiting on inventory, whether that’s new construction or availability of existing homes,” CCAR CEO Laura Crowther said in a statement to The Sun News. “In addition, we need more rental options for service industry workers ensuring adequate staffing during the busy tourism season and workforce housing to welcome new businesses to our area.”
Horry County Assessor Roscoe added that due to the county’s increased growth in all sectors, almost every type of real estate project has seen an increase in activity, including built-to-rent.
“If we talked about retirement homes, or hospitals or gas stations, they’re all growing,” Roscoe said. “Because as people are funneling into the area, then we’re gonna have to build the infrastructure that houses them, employs them, provides them entertainment, gets them groceries and their necessities.”
In terms of built-to-rent, Chesnut said more projects could be coming to the rest of Horry County in the future. “One, of course, is on the north end (of the county)… and another one is kind of Litchfield and the Murrells Inlet area.”
Article by Ben Morse. Ben Morse is the Retail and Leisure Reporter for The Sun News. Morse covers local business, Coastal Carolina University and high school sports. Morse previously worked as an intern for The Island Packet covering local government. Morse graduated from American University in 2023 with a Bachelor’s Degree in journalism and economics, and he is originally from Prospect, Kentucky.