The ownership of Baron’s Cove Hotel in Sag Harbor changed hands twice in one day on Tuesday, December 30, and the new owner intends to upgrade it into a world-class operation, according to the broker who sold it.
“I did both sides of the deal,” Prudential Douglas Elliman broker and Sag Harbor Chamber of Commerce President Robert Evjen said, noting he first sold Don Whitehead’s 66-room hotel at 31 West Water Street for $11 million to developer Michael Maidan—the owner of the adjacent condominium project at 21 West Water Street and developer of the condo project at 1, 3 and 5 Ferry Road, just down the street. The same day, Mr. Maidan, who took the option on the property back in 2007, flipped the property to Stephen Speiser of Kbr Captial LLC in Hoboken, New Jersey, for slightly more than what the developer paid for the 2.5-acre property.
Mr. Speiser’s sister Joan Gordon, of Prudential’s Locust Valley office was also involved in the transaction, according to Mr. Speiser, who said she introduced him and Mr. Evjen.
“It’s going to be a beautiful renovation,” Mr. Evjen said on Wednesday, noting that the building will see a “complete renovation,” but no demolition. “This project is going to be very helpful for luring tourists,” the broker said, adding, “I’ll call it a destination.”
Mr. Evjen said he wears two hats in Sag Harbor—one as a broker and one as the Chamber president—and the sale should help bring new business to Main Street as the new hotel draws a more high-end clientele to the village. Baron’s Cove is one of only two transient hotels near Main Street. The other is the Sag Harbor Inn, he said. “They’re so vital to the economy, especially in the summer.”
Mr. Speiser said on Wednesday that Baron’s Cove is “a diamond in the rough,” but it’s currently “a non-performing asset.” The hotel was built back in the 1950s and has not seen a renovation since the 1980s, according to Mr. Speiser. “It’s tired, it’s run down and it shows.” The new owner said Baron’s Cove will continue to run as is until he completes the review process before the village boards, but eventually he said the two-star hotel will be transformed into a “very Hamptons” five-star “luxury boutique” operation with a new name. “It needs a complete makeover,” Mr. Speiser said.
He explained that the review process should begin within a month or two and he hopes everything will be done within a year’s time. “I think everybody will be very happy” with the finished product, Mr. Speiser said.
Sag Harbor Mayor Gregory Ferraris said the planned upgrade should not be a problem as the property has only changed ownership and is continuing an existing use. He said the village will have little issue with Mr. Speiser as long as everything follows code.
On Wednesday, Mr. Maidan acknowledged that he’d flipped the property, but refused to comment further on the sale. His project manager for 21 West Water and the Ferry Road condos, Mark D’Andrea said “everything is going great” with those development plans and he expects West Water to be complete by April.
The Ferry Road project is currently in the midst of its environmental review and Mr. Maidan’s development company, East End Ventures LLC, is expected to submit an environmental impact statement to the village on Monday, January 12. Mr. D’Andrea said he expects to break ground on Ferry Road in April, around the same time the 21 West Water project is finished.