For years, the "Live-Work-Play" concept was viewed as a big-city phenomenon, reserved for metros like Charlotte or Raleigh. However, a drive through the Soda Pop District in Wilmington or the rapidly evolving corridors of Surf City tells a different story. In Southeastern North Carolina, mixed-use buildings are not just a trend; they are a response to a shrinking supply of developable land and a booming demand for walkable, lifestyle-centric communities.

For investors in New Hanover and Pender counties, mixed-use properties represent a sophisticated asset class that creates diversified income streams. Yet, executing these deals on the coast requires navigating a web of zoning, insurance, and environmental nuances that do not exist inland.

The Coastal "Vertical Vacation" Model

In traditional markets, mixed-use often means a coffee shop below long-term apartments. In our coastal market, the model is shifting toward "Vertical Vacationing."

In towns like Carolina Beach or Topsail, smart investors are looking at buildings with commercial retail on the ground floor—surf shops, boutiques, or cafes—and short-term vacation rentals (STRs) above.

The Advantage: You capture two distinct high-demand markets. The commercial tenant creates stability, while the upstairs residential units capitalize on the lucrative seasonal tourism traffic of Onslow and New Hanover beaches.

The Reality Check: You must verify that the local municipality allows STRs in mixed-use zones. Regulations in Wrightsville Beach differ vastly from those in unincorporated Brunswick County.

Navigating the Insurance Maze

The most overlooked hurdle in coastal mixed-use investing is insurance. When you combine commercial risks with residential living in a hurricane-prone zone, the policy structures get complex.

A standard dwelling policy won’t cover the yoga studio downstairs, and a commercial policy might not adequately cover the personal liability of a residential tenant. Furthermore, wind and hail deductibles can vary significantly between the commercial and residential portions of the building. Insider Tip: Before making an offer on a mixed-use building in Hampstead or Southport, require a quote that explicitly outlines how the carrier splits the wind risk between the two uses.

Strategic Zoning in Growth Corridors

While Downtown Wilmington is the obvious hub for density, the real opportunity lies in the transition zones.

• Leland and Brunswick County: As master-planned communities expand, satellite mixed-use pockets are forming to service residents who don’t want to cross the bridge.
• Hampstead: With the bypass construction, formerly quiet stretches of Highway 17 are being eyed for higher-density mixed-use projects that combine professional offices with residential living.

Your Next Step

Mixed-use assets offer a hedge against market volatility, but they require a sophisticated approach to due diligence. You need to understand not just the cap rate, but the synergy between the commercial tenant and the residential vibe above.

Aspyre Realty Group are experts in listening and communicating people's wants into homes and investments that work for them. We act as your strategic partner, helping you decode local zoning laws and insurance realities to find a property that fits your portfolio. Let’s connect to discuss where the next Live-Work-Play opportunity is hiding.