LAND HO(LD)!: Open Parcels Gobbled Up at Remarkable Rate
By Dawn Watson
According to the experts, the availability of East End-based buildable lots is at an all-time low. And since more land can’t be made, those who want new construction in certain areas — particularly those located south of the highway and east of the canal, including here in Sag Harbor — are running out of options.
“In the last five years, we’ve seen land grow scarcer than ever,” says Farrell Building Company founder and owner Joe Farrell. “As a result, we’re seeing land being developed in places previously thought undesirable more and more.”
Clearly, Sag Harbor isn’t south of the highway. But the village and surrounding areas are incredibly attractive to buyers, says Saunders & Associates President Andrew Saunders.
“There are many clients who specifically want Sag Harbor Village,” he says, adding that land scarcity is changing the real estate marketplace quickest in the most desired areas of the Hamptons. “There aren’t a lot of buildable sites out there,” he reports.
According to information shared by Thomas Preiato, senior building inspector for Sag Harbor Village, there are only 154 remaining vacant lots in the village at this time.
Due to the shrinking availability of premium land, some builders and developers are grabbing up whatever they can find in order to erect houses to keep up with the growing demand for new construction, says Mr. Farrell, who has been building houses in the Hamptons for approximately two decades. He says that he’s seen similar changes in landscape in another luxury Long Island area during the course of his career.
“The same thing happened in Huntington in 1995. All the builders were buying all the hills and holes they could find,” he says. “That was all that was left.”
Mr. Farrell, who approximates that he’s built 400 homes from Westhampton Beach to Montauk, says that he’s also rejiggered his game plan here on the East End as a result. He’s now buying up every available and attractive plot of land that’s being offered, within reason, and saving it up for a rainy day.
“It used to be that I could put together five deals in a couple of days, but now that same number takes me weeks and weeks,” he reports. “So now I’m accumulating a large amount of land, in all different price ranges, in all villages and hamlets in the Hamptons.”
The land will sit vacant until the right buyer comes along, says Mr. Farrell, who adds that his acquisition strategy has never failed him. Once purchased, Farrell Building Company starts the permit process, clears the land and puts the utilities in, according to the Bridgehampton-based builder.
“It’s shovel ready then,” he says.
In what could be seen as a prescient move, Cape Advisors, which built the Watchcase complex, chose a different route. That business opted to stick with smaller individual footprints — via a mix of penthouses and homes — in the old Bulova factory building in the village.
“The lack of available land and the regulatory barriers to building with meaningful density is what drew us to the Watchcase site in 2005,” says David Kronman of Cape Advisors. “The site had been previously entitled for a larger scale development and we believed that if we came to the Village with a thoughtful plan that saved the factory building, there was a good chance we could get the project approved.”
As the availability of buildable land dwindles, supply and demand are most definitely in effect, says Mr. Saunders. He reports that the desirability of the Hamptons continues to grow as the access to premium land continues to shrink.
“There are 25 different builders and investors that we’re working with right now — entities that are clearly in the game,” he says. “This is definitely a market where there’s a lot of dry powder out there with more people than ever looking to put money into the Hamptons.”
Those who want new construction but can’t find the vacant land often resort to teardowns, says Mr. Saunders, adding that properties as new as five years old are considered ripe for demolition.
“The teardown trend continues to grow in the secondary home market,” he says.
Many year-rounders are not happy with that. The increasingly contentious teardown topic has drawn very vocal opponents, as well as the attention of local officials.
Trustees of the Sag Harbor Historical Society recently weighed in on the matter, via a letter addressed to Village officials.
“Our mission statement requires the Historical Society to help foster respect for Sag Harbor’s exceptional heritage,” reads a letter issued by the organization in January. “We believe that a community has a right and even an obligation to protect the historic treasures which it has been fortunate enough to inherit. … For the many, many people in this community who care about such things, the need to improve our ability to preserve old homes and the feel of Sag Harbor is quite obvious.”
Mr. Preiato says that the powers that be in Sag Harbor want to ensure that the character of our village isn’t irreparably damaged by the teardown trend. To that end, all demolition must be given prior approval by the Village, and existing legislation in Chapter 300 of the village zoning code has been recently redrafted and is awaiting approval.
“There has been a rash of teardowns on the East End,” he says. “We’ve proposed legislation that defines the function and purview of the Board of Historic Preservation and Architectural Review to get this under control. It’s definitely needed, and has been drafted for approval.”
Teardowns, if left unchecked, will result in numerous adverse effects, according to information provided by Mr. Preiato. Namely, the intensity of new development will result in out-of-scale houses; water quality issues; and lifestyle irritants, such as pollutions, loss of privacy (and peace and quiet) and increased traffic.
“This trend of expanding existing housing or tearing down existing homes to construct much larger homes is at odds with existing historic development patterns,” reads a revision to the current code. “Such development is not consistent with the goals and purposes of the Zoning Code. If such development continues unabated, Sag Harbor risks destroying the very unique character that makes it so popular in the first place. The negative impacts of such develo