SOUTHOLD, NY — The Suffolk County Industrial Development Agency has approved $2.7 million in tax breaks for the proposed $43.9 million project, “The Enclaves.”
For months, residents have cried out against the project, citing concerns about impacts on the bucolic canvas of Southold Town.
Last week, the IDA granted the tax financial assistance, including $1,818,078 million in sales tax exemptions for building materials and equipment, $245,911 mortgage recording tax exemptions, and $705,208 saved with a 15-year PILOT, or payment in lieu of taxes, program. The PILOT represents a 36 percent savings in taxes over the term, the IDA said.
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According to a release from the IDA, plans for the Enclaves, located at 56655 Route 25 at the former location of The Hedges bed and breakfast, are for “a world class, full-service hotel” across 6.7 acres of existing land. The 72,000+ square-foot hotel will include 40 guest rooms, 4 cottages with private housing space and hot tubs, indoor and outdoor pools, a spa with four treatment rooms, exercise rooms, two restaurants and 4,170 square-feet of event and meeting space.
Southold Town Supervisor Al Krupski spoke with Patch about the Suffolk IDA’s tax relief: “The decision of the Suffolk County IDA regarding the tax relief for the Enclaves hotel project demonstrates their inability to understand economic impacts to a community. Giving tax breaks to developers makes the residents’ taxes increase — as paying for the increased demand on services falls not on the developer, but on the town residents.”
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He added: “This is corporate welfare, benefiting a few, costing the rest of us. They clearly didn’t consider any input from the town or from the public hearing that they held in town.”
The Southold planning board granted conditional approval to the project in June, after years of public debate and outcry.
The IDA is authorized by New York State municipal law to extend financial assistance in the form of potential exemptions from New York State sales tax, property tax and several other costs.
In October, the Suffolk County IDA preliminarily approved a transaction to assist Enclave Southold, LLC to construct a full-service hotel located at the site.
With the SCIDA’s support, Enclave will renovate the historic 3,764 square-foot home and begin the new construction of a 72,979 square-foot hotel on the property.
The $43 million project creates a hotel that will be home to a wide-range of amenities including two restaurants, a spa with various treatment rooms, cottages and much more, a release said.
“This project checks all of the boxes; it will help satisfy a growing need for quality hospitality options on the North Fork, significantly increase tax revenue and create jobs all while keeping up with the aesthetic of the surrounding area,” said Kelly Murphy, acting executive director of the Suffolk County IDA. “We’re proud to provide our support to this project that will provide real economic growth for the area as well as local businesses while also bolstering Long Island’s tourism sector.”
“The historic home on the property will be transformed into an on-site 74-seat restaurant that will be operated in conjunction with the hotel. A multi- million site work package, including a sewage treatment plant, will be installed as required by the Suffolk County Department of Health Services and the town,” the release said.
In 2015, the historic property was purchased by principal of Enclave Southold Jonathan Tibett for the purpose of “realizing his larger dream” that Southold would one day be home to a full-service hotel, the IDA said.
With Long Island’s extensive options of wineries, farms, fisheries, beaches and other tourist attractions, there remains a need for additional high-quality accommodations for travelers and visitors to Long Island’s East End, the IDA said, adding that, according to the Tourism Study and Demand Analysis prepared by HVS Consulting & Valuation, it is expected that over 90 percent of the hotel’s guests will come from beyond Nassau and Suffolk Counties.
“We are incredibly thankful to have the support of the Suffolk County IDA on the construction of the Enclaves Hotel and Restaurants project,” said Edward Glackin of Enclave Southold, LLC. “When the property was initially purchased, it was home to the Hedges Bed & Breakfast with the dreams of one day being home to a luxury hotel for visitors to Long Island’s North Fork to enjoy. Due to the support of the Suffolk IDA, that goal of creating a world-class hotel and additional lodging for those visiting our region, will now be possible.”
Project principals stated that with tourism a focus on the North Fork, “there has remained a high demand for local lodging for both leisure and business tourism, despite limited supply for lodging. The Enclaves will help to satisfy a portion of the demand for expansion of accommodation options for visitors to this region.”
In addition, the IDA said, the 51 new full-time employees to be created over the first two years of this transaction will have an overall annual payroll of $2.3 million. The renovation, building, finishing, and installation of fixtures and other equipment will be performed by almost exclusively Long Island based businesses and suppliers, the group added.
The project will also increase tax revenue from the site three-fold in the first year alone, bringing in more than $1.27 million in additional tax revenue over the course of 15 years, the SCIDA said.
With increased tax revenue and by supporting and using local vendors on Long Island, the project has been calculated to provide an overall public benefit of more than $8.5 million, the SCIDA said.
A planning board discussion of the project in January, 2022, via Zoom gave residents a chance to voice their concerns, and many implored those involved to consider the impacts on the community.
In December, 2021, the Southold Town zoning board of appeals granted conditional approval to The Enclaves.
Discussing the plans in 2022 via Zoom, Andrew Giambertone, a partner in the project, described the vision for what was former the Hedges B&B on Main Road.
Giambertone said the existing Italianate Victorian home would be transformed into a 74-seat restaurant open to the public; a private drive will run across the property and substantial hedgerow will maintain privacy and limit visibility of the hotel from the street.
“The concept was to make the hotel as inconspicuous as possible,” Giambertone said.
Public opposition
Southold residents turned out in force in October 2021 for a zoning board of appeals hearing on the project.
Time and time again, residents implored the ZBA not to grant the special exception for a project they said would irrevocably alter the character of Southold Town forever.
“Just say no!” one resident said.
Some residents have spoken out on social media with concerns regarding environmental issues, noise, quality of life, and impacts on small mom-and-pop businesses in the area; a petition was created, “Opposition to the Enclaves Hotel in Southold.”
The proposed restaurant and hotel will operate year-round, with hours of operation consistent with such uses.
The application was also discussed at a Southold planning board work session in 2017.
At a past meeting, Angelina McKenna said she and her husband had come to express concerns “about this horrendous project being proposed. The Town of Southold prides itself on its heritage and strong sense of community,” she said. “Our roads cannot handle more, nor do we want more. Who will benefit from this outlandish, outrageous proposal?”
Also, McKenna said, there is already a dearth of affordable housing; there will be nowhere for the facility’s employees to live, meaning they would all have to commute.
“We used to say, ‘Save what’s left,'” said. Terry Walker of Southold. “Now it’s ‘Save what’s left, after I get mine.’ Enough is enough. We are the residents. We matter.”
Paul Romanelli, who lives in Cutchogue and owns a business on Main Road in Southold, spoke out in favor of the project, saying there is a need for more hotel space and that traffic studies are accurate; he does not believe traffic will be an issue. He pointed to other projects by the developers, including North Fork Table and the new Southold General. The goal of the comprehensive plan was to site new businesses in the hamlet centers and to stimulate the economy, he said. “We got what we wanted,” he said, adding that B&Bs and hotels are full year-round.
Giambertone spoke to Patch in 2017 about the vision for the plan.
He said the goal was to create a “high-end” restaurant. “We’re hoping to create a unique environment. The Town of Southold seems to be gravitating toward bringing more upscale wine tastings to the wine area.”
The owners of the property, Giambertone said, are local residents. “They’re looking to preserve the bucolic nature of Southold, and not turn it into anything else. They love what Southold is all about, love the relaxed atmosphere. And they see the need for the hotel, see the need for that opportunity.”
The need for a hotel exists, he said. But neighbors should not worry about a noisy establishment, he said. The aim is to provide guests with a place of “respite and privacy, where they can enjoy what’s beautiful about Southold — which is the peace and quiet,” Giambertone said at the time.
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