After setting a minimum price of $3 million for the sale of seven town-owned office condominiums at Pantigo Place in East Hampton — or $428,571 per condo — the three members of the East Hampton Town Board’s Republican majority agreed on Tuesday to accept a bid of $1.2 million for four of the condos, a sale price of $300,000 each.
The decision set off a heated discussion, but the debate may well be moot, as the buyer, Andrew Sabin, said yesterday that he had withdrawn his bid.
Appraisers had set the value of the seven condos, sold together, at $3.7 million, or $528,571 each, or $628,571 each if sold separately.
In the face of questions about the plan from Sylvia Overby and Peter Van Scoyoc, the new Democratic members of the board, about the price and whether it is realistic to expect a renovation of the old town hall building to be completed in time for town offices to be moved there in just a year, Town Supervisor Bill Wilkinson asked Tuesday, “At what point would this board accept a discount” to the potential buyer?
As part of a deal, the town would get a rent-free year in the sold condos, while renovations are completed at the former town hall building; however, plans for those renovations have not yet begun.
Mr. Sabin confirmed that he had originally approached the town about buying all of the office units for $3 million, and had then submitted the lower bid for four of the condos.
But he said that he had sent a letter withdrawing the bid until the new board members “get on board and figure out what they want to do.”
However, Mr. Sabin, who owns four units at the Pantigo building, and uses two for the offices of Sabin Metal Corporation, said that he would “rethink it” if he got a go-ahead from the board for the low sale price. “I’m not going anywhere,” he said.
Mr. Sabin asserted that “there’s no market” for the condominiums, and said he had planned to hold them until the commercial real estate market improved. One of his condos, he said, has been vacant for three years, and a tenant is moving out of another.
Councilwoman Theresa Quigley, who had broached the topic to the board, said Tuesday that bids of $1.2 million and $700,000 had been received, in addition to the $3 million. That offer, she said, “was a great bid, but the person didn’t like how government operated, and pulled out,” before coming back with “lower and lower bids.”
Town Supervisor Bill Wilkinson said the sale would raise money for renovation of the old town hall building. “There’s a tremendous value to having a workforce on the same campus,” he said.
He said that after gutting the 10,000-square-foot space, a “European-type work space,” with open areas allotting 75 to 100 feet per worker, versus the standard 200 square feet per person, could be created, and a model initiated where workers would not necessarily complete their responsibilities at Town Hall.
Ms. Quigley said that selling the condos would save the town $40,000 a year on maintenance fees for the four units. In addition, she said, having only one town office in the old town hall building at present — and the associated light and heating costs — is wasteful.
The old building is in poor repair and has suffered water damage, including in the former courtroom, which was condemned by the town fire marshal. Recently, $60,000 of equipment for the town’s new telephone system was installed in the basement there, Ms. Overby said.
Mr. Wilkinson said an engineer who examined the building had estimated a $500,000 renovation cost. But Councilman Van Scoyoc, who is a building contractor, said that it is impossible to tell without a full review, and that it could easily be much more.
The time needed for the project could also be much longer than a year, he said. According to the sale proposal described by Ms. Quigley, after a year the town would have to pay $15,000 to $17,000 a month on the Pantigo Place condos if town offices still occupied them.
“In a perfect world it could go pretty quickly, but we don’t have any plans yet,” Mr. Van Scoyoc said. He suggested the board immediately begin working out a plan, but Ms. Quigley said she was unwilling to spend money on planning the project until the sale proceeds come in.
Selling the condos is not the only way the town could finance a building renovation, Mr. Van Scoyoc pointed out.
With the new state law imposing a 2-percent cap on tax increases, and the need to finance a multimillion-dollar deficit that had accumulated in past years, it will be difficult to raise money for capital projects, Councilman Dominick Stanzione said. A capital plan is being developed.
“We’re under a real tight constraint with our capital budget, so we have to look at creative options, and this is one of those kinds of responses to our situation that I support,” he said.
He suggested that the board vote on a resolution approving the sale at its next meeting.
Councilwoman Overby suggested more consideration is needed. She questioned what the condos had been appraised for, which was not discussed at the meeting, as well as what price other condos may have recently sold for.
The units were purchased by the town in 1991 and 1996, Len Bernard, the town budget officer, said, at an approximately $300,000 cost per unit, and the town still owes about $120,000 on them.