The luxury Sag Harbor condominium project known at 21 West Water has $1.7 million in liens filed against it by contractors and suppliers and as of press time has yet to renew its building permit with the Village of Sag Harbor, which will cost developers roughly $45,000.
The waterfront condo project, which was approved over two years ago by the village, is a three-story, 19-unit development proposed to include a rooftop swimming pool and luxury amenities throughout the residences. Michael Maidan and Emil Telal under the limited liability corporation East End Development are the developers of the project. Residences are priced from $1.6 to 4.5 million according to Prudential Douglas Elliman associate broker Robert Evjen, who is the exclusive agent for sales. According to Evjen no contracts have been signed, but there have been five offers made on condos in the building that are in the midst of negotiations.
The duo, under the name East End Ventures, have also proposed a second waterfront condo project at 1, 3 and 5 Ferry Road, although that development has also been stalled after changes to the zoning code prevented it from moving forward as originally proposed. Last month East End Ventures filed two suits against the village to move the project forward as originally proposed and seeking monetary damages to the tune of $30 million.
The suits allege that village officials altered the code to specifically thwart this condo project and that the new village code was adopted without proper environmental review.
Over a week ago, village officials placed a stop work order at 21 West Water Street after discovering its building permit had expired in late 2008. After two 90 day-extensions were granted, village officials stopped work on the project, although project manager Mark D’Andrea said Tuesday he expects the project architects and developers to renew the permit shortly.
“It expired through the normal course of business,” said D’Andrea, who added developers would stay true to the stop work order until the proper paperwork has been filed with the village. D’Andrea said the project, which he says is roughly 90 percent complete, faced delays as a result of difficult winter weather, which pushed its completion back several months.
“We are so close to the finish line,” he said.
At the same time, while the project has been stalled, according to records available with the Suffolk County Clerk’s office, local contractors have filed some $1.7 million in liens against the project for unpaid work and materials during the last nine months.
In February, A & F Fire Protection Co. Inc. filed a $25,000 lien against the future sales at the development for engineering, drafting and professional services. D’Andrea said on Tuesday that while they had spoken with the company, their quote was too high. Despite that, he said, A & F hired a draftsman to create plans for the project and are seeking to be paid for that work. D’Andrea maintained that lien is in the process of dismissal.
In September of 2009, Oldcastle Precast filed an $84,000 lien against 21 West Water Street, which D’Andrea said on Tuesday was to pay for their retainer. He said generally that money is kept in escrow until a project is completed and receives its certificate of occupancy.
All Systems Maintenance Inc filed a $247,794 lien on October 2 for plumbing related materials, A Richmond County Stucco & Stone Contractors Inc filed a $102,359 lien on October 5, Southampton Brick & Tile filed a $94,340 lien on October 9, Inter-County Mechanical Corp. filed a $510,241 lien on October 9 and B & G Electrical Contractors of NY Inc. filed a $630,274 lien on October 8.
D’Andrea said those claims are common, filed as a result of construction stopping as the developers await renewal of their building permit.
“When construction stops the bank stops paying, so sometimes people working on-site put liens on the property to keep you motivated,” said D’Andrea. “It is common practice in New York and not at all a sign of financial distress.”
“None of these contractors is in an adverse relationship with us,” he later maintained.
He added, considering the estimated $30 million the project is worth, $1.7 million in liens does not amount to much of their bottom line.
As for the developers relationship with its bank, Amalgamated Bank of New York, D’Andrea said their loan “is fully funded and in very good shape,” but that the project has seen time delays due to weather and the intricacies of a luxury condo project.
“A building of this quality and intricacy, you can’t rush it,” he said. “It’s like a 12-tier wedding cake. You can’t run down the street with it on your head.”