It has been three years since Cape Advisors was given final approval by the Village of Sag Harbor to construct luxury condominiums at the historic Bulova Watchcase Factory. Following approval, the economy tanked, lawsuits were filed over the village’s approval of the project and for the better part of two years the watchcase factory has sat shrouded in scaffolding, with little word on whether or not the project would resume.
On Tuesday night, at the Sag Harbor Village Planning Board meeting, Cape Advisors founder Craig Wood announced the condominium project could move forward as early as this fall, but only if the planning board allowed three changes to its approval of the development, including when Cape Advisors must pay over $2.5 million into the Sag Harbor Community Housing Trust.
Without almost immediate approval of these changes, given the turbulent economic worldwide forecast of recent weeks, Wood questioned whether or not this opportunity would pass by both Cape Advisors, and the village at large.
The Bulova Watchcase Factory restoration and redevelopment is for a 65-unit luxury apartment building in the historic factory building and seven townhouses, which will contain 16 of the units. A recreation center, with indoor pool, and an underground parking facility is also planned for the project, which estimates have shown could cost nearly $100 million to complete.
The factory building, which for 100 years operated as the industrial heart of the village under a number of company banners until its doors were closed in the early 1980s, has remained dormant for over 20 years, although a few have tried, and failed, to redevelop the site. The property, located at Division and Church streets, is a state Superfund site. Remediation is ongoing and required for the apartment project to move forward.
On Tuesday, after years of not having the financing to move forward with the project, Wood said his firm hoped “to close with a new lender in early September and start construction this fall.”
“We are very concerned with moving this along quickly given the state of the world,” added Wood, noting his company needs a few of the 70 conditions in the village’s approval of the project altered in order to secure financing for the project.
The first issue, said Wood, is the request that Cape Advisors change the payment schedule for the $2,524,600 it agreed to pay into the Sag Harbor Community Housing Trust in lieu of on-site affordable housing, easily the most debated issue during the planning board’s review of the project.
Following the affordable housing debate, and a requirement the village ultimately overrode by the Suffolk County Planning Commission for 20 percent on-site affordable housing in the project, the planning board required Cape Advisors pay $2.5 million into the newly created Sag Harbor Community Housing Trust. That organization would then use that capital to start affordable housing efforts within the Sag Harbor School District.
In the planning board’s resolution approving the Bulova condominiums, it required Cape Advisors pay $582,600 into the trust when it is issued its building permit. Following the first payment, $194,200 must be paid each time the developers receive certificates of occupancy for the first five units, and the same amount each time they receive a certificate of occupancy for the 10th to 15th units.
Wood said his firm would instead propose that payment to the trust be made with each closing sale of the 65 units.
“And this is required for our loan as well,” said Wood.
Wood also asked that the planning board’s requirement for a liaison committee — made up of planning and architectural review board members, as well as police and the building department — be assembled immediately.
Wood said his firm would also like to post bond, but not the second letter of credit, as required by the village for projects of this scale to ensure their growth, performance and the maintenance of sidewalks.
Lastly, Wood asked Cape Advisors not be required to have a crossing guard stationed at the cross walk to the Stella Maris Regional School across from the Bulova site, given the school is closed. If it reopens, Wood said the firm would reinstate the crossing guard requirement.
Planning board member and former mayor Greg Ferraris, who was also one of the founders of the Sag Harbor Community Housing Trust along with the new village attorney Denise Schoen, said that both he and Schoen have formally resigned from that board to avoid a conflict of interest. Stacy Pennebaker remains the committee’s president.
According to Sag Harbor Mayor Brian Gilbride, the housing trust will be asked to work closely with the Long Island Housing Partnership in implementing affordable housing in the village, once it has the funds to get off the ground.
On Tuesday night, Ferraris added that he and Schoen both agreed that their input into the evening’s discussion should be kept minimal.
Board member Jack Tagliasacchi said he believed everyone on the board realizes “the economy is very, very bad.”
He said he believed changing the affordable housing payment schedule, as well as the crossing guard requirement, made sense, but that he would like the village’s attorney to review the request before the board formally adopts a resolution regarding bonds.
“I think as a part of the deliberation process we have to think about the implications to the applicants, the financial environment has already changed, but we also have to think about what it means to the village,” said planning board chairman Neil Slevin, adding he was uncomfortable voting on the measure that evening.
“I know you have been waiting very long, and so have we,” he said.
Wood countered that while he understood the village’s position, during the two years it took to gain village approval for the Bulova project, his firm lost two financiers.
“With the instability of the world today, we want to close as soon as possible so we can build this project,” said Wood, imploring the board to schedule a special meeting before its September 27 meeting to weigh in on Cape Advisor’s requests.
“We are concerned with that building as much as you,” said Tagliasacchi.
Slevin said the village would immediately form the liaison committee and the board was comfortable waiving the crossing guard requirement, but that in relation to bonds and affordable housing needed legal counsel.
Schoen added the planning board could in fact hold a special meeting if they so desired.
“The bank wants to move forward and they don’t want to wait a month,” said former attorney for Cape Advisors and Sag Harbor resident Dennis Downes. “I think all of us would like to see this project come to a conclusion.”