Harbors Edge Condominiums in Sag Harbor.
By Annette Hinkle
This spring, not one, but two Sag Harbor condominium projects will be completed and ready to welcome their first tenants. Together, Watchcase, the luxury condominium complex in the former Bulova Watchcase Factory on Division Street, and Harbor’s Edge, a condo development on West Water Street on the site of a former restaurant and night club, will add 78 apartments to the village’s residential stock. While its not a huge number of units in the scheme of things, the development of these two complexes, which will be purchased primarily as summer or weekend homes, says a great deal, not only about the financial security of those who will soon take up residence in Sag Harbor for at least part of the year, but also changing demographics on a national level.
Watchcase
Finishing touches being completed in one of the units in the Watchcase condominiums in the former Bulova Watchcase Factory.
It’s been a long road, but the finish line is in sight for Cape Advisors, the Cape May, New Jersey-based firm responsible for Watchcase, the single largest residential development in Sag Harbor’s history.
The project, which began in 2006 and went on hiatus in 2009 in the wake of the economic meltdown, involves renovation and redevelopment of the historic Bulova plant at the corner of Division and Washington streets from a derelict property into a complex complete with fitness facility, heated outdoor pool and, in many cases, spectacular water views.
“It’s been a very complicated construction process, but there’s light at the end of the tunnel,” says David Kronman, a partner at Cape Advisors, and someone who has been involved in the project since the beginning. “There were surprises on every corner with the renovation of this building — including wings we thought were in better shape and chimneys that needed to be rebuilt.”
But Watchcase is nearing completion and will bring a total of 63 new condo units to the village — 46 in the original factory building (down from 47 due to the merging of two apartments) and another 17 in nine newly constructed townhouses along Sage and Church streets.
“Sometime in March, we expect tenants to begin moving in,” says Mr. Kronman, explaining that COs (Certificates of Occupancy) for Watchcase are being obtained in stages so some areas can be occupied while construction continues on other parts of the site. The lobby is among the areas Mr. Kronman expects to be finished by the time the first tenants move in.
Watchcase apartments come with fireplaces and outdoor garden patios or terraces and in addition to the fitness center and pool, as well as amenities including an underground parking garage and full concierge service. But luxury doesn’t come cheap. Prices range from under $1 million for the smallest unit up to $10.2 million for the largest penthouse, which at nearly 3,000 square feet, offers spectacular water views. The average monthly maintenance fee at Watchcase will come in around $1,800 per unit.
Mr. Kronman notes that loft apartments in the factory building have sold well… quite well in fact.
“The product we have left in the project are six of the penthouses,” explains Mr. Kronman. “Other than that, we’re virtually 100 percent sold out in the factory.”
The reason some penthouses remain, notes Arthur Blee, another Cape Advisors partner, is because these are the type of units that buyers want to see in person before committing.
“If you buy a one bedroom with a living room off the plan, you can see that in the model unit,” explains Mr. Blee. “The penthouses are more complicated. With their views, when you get in and see them, you realize how special they are.”
“The thing about the penthouses, they are amazing spaces,” adds Mr. Kronman.
“But you have to get into them to see them and understand them,” says Mr. Blee.
The same has held true for the new townhouses, which have four bedrooms on two floors and will be marketed more aggressively once construction on the entire project is complete sometime this summer.
“A lot of buyers came through and said, ‘I love the location and the product, but I don’t like buying off floor plans,” explains Mr. Kronman. “Once we’re done I think the units will be absorbed quickly.”
“Now people will be able to walk in and understand and we think we’ll have a great spring and summer for that reason,” adds Mr. Blee.
So who, exactly, are these buyers at Watchcase?
“It’s a good mix of people, a lot of whom already have a presence on the East End,” says Mr. Kronman. “Watchcase appeals to them because of amenities, services and its proximity to Main Street and the water. It’s a very walkable community and a turn key lifestyle.”
“It’s both year rounders and summer people who have been out here for years and are now choosing this lifestyle,” adds Mr. Blee. “There have also been a couple of international buyers and some with places in New York or Aspen.”
“There’s an appreciation from the buyer’s perspective for the extent we’ve gone to in order to preserve the architectural details and the architecture,” says Mr. Kronman. “The building is such an important part of the history of Sag Harbor. I think people wanted to see the building saved.”
“Buyers recognize this is a once in a lifetime opportunity,” he adds.
Harbor’s Edge
At Harbor’s Edge, construction is nearing completion on 15 two and three bedroom apartments ranging in size from 2,000 to 3,000 square feet. All units have great rooms with fireplaces that face Sag Harbor Cove and either a terrace or private yard. Units on the first two floors are priced between $2.25 million and $4.1 million while the three penthouses on the top floor are from the high $5 million range and to the mid $6 million range. Monthly maintenance fees will be approximately $2,000 to $3,000 per month and amenities include a rooftop pool and lounge area.
“They are designed for how we live today with an open kitchen and a great room that flows into the balcony,” says J. Keith Green of Halstead Property, who oversees marketing and sales of the property. “Life in the city sends you in different directions, here you choose to be together.”
Harbor’s Edge began life in 2006 as a project of East End Ventures, but midway through construction, the developers encountered financial difficulties. By 2009, workers were walking off the job and the development sat dormant for almost four years. In 2012, the developers filed for Chapter 11 bankruptcy, and the property was obtained by Water Street Development at Sag Harbor, LLC which has made several design and landscaping changes to enhance the building’s appearance.
Now, with the project nearing completion, Mr. Green is planning to host a grand opening at Harbor’s Edge during the first week in April.
“Six units have passed inspection and we expect to have the whole building approved within a matter of a month,” says Mr. Green. “By the time of the opening, our COs will be 100 percent complete and we’ll have 15 homes available.”
Mr. Green said negotiations were already underway with a few different buyers and he expected to go to contract soon on one of the penthouses.
“By May, we expect closings and the first folks moving in – people who want to make the season coming up,” he says.
When asked about his potential buyers, Mr. Green says a majority of them are people looking for more flexibility.
“The Hamptons are an important part of their lives but they want freedom from maintenance and all the people it takes to maintain a house,” he says. “It’s also the freedom to travel, spend time with the grandchildren and come and go as they please.”
“When you walk out the door you’re done,” he adds. “It defines a different time in life. These are people who have already owned a home, but are looking to change. Ninety percent of them are saying this is my way of having the Hamptons continue to be an important part of my life in a much simpler way.”
Though the potential for more new condominium developments in the village may be limited, Mr. Green sees the desire for this sort of turn key product continuing well into the future.
“I’ve studied this for some time and I see two phenomena happening,” says Mr. Green. “One is a social phenomenon and the baby boomers aging. Every 7.6 seconds a baby boomer turns 65 and they want that freedom. The other phenomenon is a civic issue in which communities say ‘I don’t want a condo on my street.’ There is civic pressure against it, but social pressure for it.”
“Someone asked me about the future of condos in the Hamptons, my answer was, ‘It’s limited, but there’s a lot of demand for it,’” adds Mr. Green. “What Bulova and we are benefitting from is those colliding phenomena. In the end, there are not that many condos in the village on the harbor with sunset views.”
“It’s the limitations that make it a unique product,” he adds.
While the water views may be what captures people’s attention, it’s the proximity to village amenities that keeps it.
“An urban environment defines where you live and who you are,” says Mr. Green. Becoming one with a community happens more organically by foot than it can possibly happen by car. If you’re going out for coffee, your feet is how you do it. Pretty soon you don’t think about the car for days.”
Conversely, just as Watchcase is breathing new life into a long forgotten stretch of Church Street, Harbor’s Edge and, next door, the soon to be revitalized Baron’s Cove Inn and restaurant (which is being redeveloped by Cape Resorts, Cape Advisors’ sister company) will do the same for West Water Street.
“This stretch for a long time has been a no-mans land — the dark end of town,” says Mr. Green. “Once the lights are on at Baron’s Cove and this property, the energy that reflects what it should’ve been will be here — the wonderful chance to walk by the bay, which people never did because it was dark and foreboding.”
“Now it will be bright and welcoming.”
