East Hampton Village wants to buy the five inns in its Main Street Historic District using its $22.4 million portion of the town’s community preservation fund.
The Hedges Inn, the Maidstone Hotel, the Huntting Inn, the 1770 House, and the Baker House 1650 are all in the district, which is listed on the National Register of Historic Places, and are all on Mayor Jerry Larsen’s wish list.
“On July 17, the village was approached by one of the owners of the five historic inns, who expressed their desire to sell the property to the village,” Mayor Jerry Larsen wrote in an Oct. 1 letter to East Hampton Town Supervisor Kathee Burke-Gonzalez. “This proposal has prompted us over the last few months to take a broader, strategic approach toward securing the long-term historic preservation and appropriate use of these five historic properties.”
Mayor Larsen said that the village would seek to acquire the inns as they become available. (The village’s portion of the C.P.F., from real estate transfer taxes collected on transactions within village boundaries, is commingled with the town’s money but set aside for the village to use, with town board approval.)
The plan is a direct result of the village’s battles this summer with Scott Sartiano, owner of the Zero Bond private membership club in Manhattan, who seemed poised to open an East Hampton outpost of his celebrity hangout at the Hedges Inn. Village pushback and neighbors’ opposition led him instead to open a summertime pop-up of his Manhattan eatery, Sartiano’s.
A spokesman for Mr. Sartiano didn’t respond for comment on whether he was still pursuing a relationship with the inn.
While she couldn’t confirm the date, a spokeswoman for the Hedges Inn’s owner, John Cumming, said that the conversation about selling the Hedges Inn to the village had taken place.
In his letter to the supervisor, Mayor Larsen wrote that an appraisal for one unnamed inn was in the works. However, Mr. Cumming’s spokeswoman said, “John is open to more conversations and
hasn’t decided yet and is looking at several options. For now, he is taking time to determine the best direction forward.” She wouldn’t comment on whether Mr. Sartiano had shown interest in purchasing the inn.
Mayor Larsen highlighted his concern that the State Liquor Authority, which has the power to overrule local laws if they’re written to regulate the sale of alcohol, may not force establishments to abide by village laws. “This could result in significant legal and community challenges undermining the village’s efforts to maintain the peace and integrity of our residential areas,” he wrote.
“The S.L.A. didn’t give me a warm and fuzzy feeling that they’d be there to back us up,” said Marcos Baladron, the village administrator. “I think we saw for the first time this summer that something really hazardous could happen in our residential areas. We want to keep these buildings as inns and restaurants. They started with local families, the founding fathers of East Hampton Village. Now, corporations are purchasing them. At what point do those corporations push for more intensification? That’s exactly what neighbors don’t want.”
While buildings that are designated historic locally, by the state, or are on the national register may be purchased with C.P.F. funds, never has the fund been used to purchase a historic building that is subsequently leased out to a for-profit business. The fund, established in 1999, is more commonly used to purchase and protect open spaces or for outright historic preservation. However, the statute regulating the C.P.F. permits adaptive reuse of a building as long as it is consistent with its historic use, if public use is maintained and maximized.
There are a few rough analogs to the situation: Southampton Town used its C.P.F. to purchase a facade easement and development restrictions at the Sag Harbor Cinema, which is managed by a nonprofit. The Steinbeck House, also in Sag Harbor, was purchased in part with C.P.F. help and is being used as a writers retreat and museum, with limited public access. East Hampton Town has used its C.P.F. to acquire farmland and lease it to farmers. In 2018, the town agreed to license the use of six clay tennis courts in Montauk to Gotham Tennis. While Gotham is technically a for-profit, the town set limits on the rates it could charge that matched those at Montauk Downs, a state facility.
A close comparison exists within East Hampton Village limits, where in 2014, the C.P.F. was used to purchase the Gardiner Mill Cottage, just down the road from the Hedges Inn, on James Lane. It is being run now as the Gardiner Mill Cottage Gallery, “a museum and exhibition center” according to its website. The village has a license agreement with Terry Wallace, its executive director, to manage the property, but it charges him nothing for the space. Mr. Wallace has organized sales for local artists from the space, but has said he does not profit personally.
“He’s not selling stuff out of there,” said Mr. Baladron. “He’s managing the space and trying to get more people to walk through it. No one knows more about local artists.”
In Mayor Larsen’s letter, he offered no specific plan for the buildings’ use should the village successfully gain ownership, but said it could be leased to “qualified operators through a public bidding process, generating revenue that can be reinvested into community projects and services” and that ownership of the inns would allow the village to “control how they are developed and utilized, preventing inappropriate or disruptive business ventures from taking root.”
“We’re already in that business,” said Mr. Baladron. “We bring in about $1.2 million annually from the Sea Spray Cottages and about another $100,000 from the Chowder Bowl [at the Main Beach pavilion]. We’re good at it.” The village purchased the Sea Spray Cottages in 1979. Assemblyman Fred W. Thiele Jr., one of the architects of the Peconic Bay Region Community Preservation Fund, said that if the village is to purchase the buildings, they would first have to be approved for the East Hampton Town C.P.F. project plan, and their historic designation verified.
Here’s the process: their recommendations are vetted by the town’s C.P.F. advisory board, then by the town board. If both think the purchase appropriate, the property is appraised, a price negotiated, and after an offer, acceptance, and signed contract, a public hearing is held.
“Then it becomes a question of whether there will be a compatible reuse of the property. If they’re used as inns, and they’ve always been inns, that sounds consistent. The statute doesn’t absolutely preclude this use of the funds. The question for the town is how much commercial use they want on a historical property that is managed by a third party. The town will have to apply standards and determine whether it’s appropriate or not. If there is revenue raised, are you putting it back into the property or into the general fund? It would be hard to argue it belongs in the general fund.”
“It is important to recognize the dangers of these properties being converted into private social clubs that restrict entry to the general public,” Mayor Larsen wrote in his letter to Ms. Burke-Gonzalez. “Such a transformation would not only limit the community’s access to these historically significant properties but also create exclusive enclaves that undermine the inclusive spirit of our town. Ensuring that these properties remain accessible to all residents is essential to preserving the character of East Hampton.”
While Patrick Derenze, the public information officer for the supervisor, confirmed receipt of the letter this week, he said via text that the town board had not yet discussed it and that the supervisor “has no comment at this time.”
