Just outside the village of Rhinebeck, there is a potent sign of a housing market gone bust: an abandoned construction site with dozens of half-built condos marked by weather-beaten plywood walls and weeds sprouting up in the bulldozed paths that were supposed to be driveways.
It”™s an odd sight in this otherwise bucolic region of Hudson River estates and prosperous villages. But even stranger is that the condo market here is robust ”“ so strong that the 83 condos in the development that have been completed are fully occupied. When a unit does come on the market, it sells for a hefty price, despite that the access road winds past a chain link fence with a depressing view of abandoned buildings.
The Gardens at Rhinebeck, as the development is called, was to be built in three phases. Phase one was completed six years ago. But last year New York developer Selvin Green apparently gave up after building between 80 and 90 condos in phase two. Ground was never broken on phase three.
According to Jay Zeiger, an attorney at Kalter, Kaplan, Zeiger & Forman, based in Woodbourne, who is representing the condo association for phase one, construction on phase two stopped six to 12 months ago after Grand Pacific Bank in Los Angeles foreclosed on the property. “We believe the developer was unable to refinance,” Zeiger said.
Zeiger had filed a complaint with the New York state attorney general a couple of years ago on behalf of the condo association about work that hadn”™t been completed in phase one, such as an inadequate firewall, missing shutters, and four three-unit buildings whose exteriors still hadn”™t been painted.
“A lot was taken care of, but a lot wasn”™t,” he said. “We may or may not bring a lawsuit. Our current plan is to see how the dust settles with respect to the lawsuit now pending with the bank and contractor.” Zeiger said the contractor, Bovis Lend Lease, had filed a mechanics lien against the developer. According to its Web site, Bovis Lend Lease is managing the “abatement, demolition and construction of the military housing units, as well as site improvements and underground utilities” at Stewart International Airport. Its billed as a $46 million project.
One puzzle is why Green undertook so much construction at once, instead of building and selling the units in smaller increments. An attorney representing Green said he had no knowledge of the project; another attorney representing the developer didn”™t return a call for comment. Calls to Grand Pacific Bank and Bovis Lend Lease were also not returned.
Kathy Kinsella, the vice president of both the phase one condo association and the homeowner”™s association that oversees the shared amenities, consisting of a clubhouse, pool and tennis court, said the four buildings still had not been painted. Other punch list items also had yet to be completed. The developer “had promised to finish the phase-one items, but in the last four months he”™s gone from the scene,” she said.
Oversight of the clubhouse and other common amenities, which was supposed to be shared with the phase two condo owners, is also in limbo. The developer didn”™t convey the deed for the facilities to the homeowners”™ association, said John Piastra, vice president at River Management, based in Poughkeepsie, which is maintaining the clubhouse, pool and tennis courts for the homeowners”™ association.
All the facilities are being fully maintained. However, when Green turned over the facilities to the residents of phase one last summer, the annual fee per unit increased to $50, which was substantial, Kinsella said.
The access road from Route 308, which is to be turned over to the town upon completion of the project, is also still owned by the developer. Kinsella said the bank was paying for the snowplowing of the road, as well as the access to the clubhouse.
Warren Replansky, attorney for the town of Rhinebeck, said the municipality had also been having problems with the project before the foreclosure. “There were problems in the construction of the phase-two portion, including some very serious fire safety issues concerning property firewalls,” he said. “The town had to issue a stop-work order to the developer.” Other problems had to do with requirements of the site plan and special permit approval, he said. The issues were not resolved and will have to be “remedied with the new developer,” Replansky said. He said the town is holding a performance bond for the access road.
Despite the mess, Kinsella said she is glad to be living in her condo. “Phase one has a wonderful character,” she said. The buildings were laid out to maximize the amount of light in each unit, which have large windows and plant-lined walkways. Linda Page, principal broker for Fraleigh Rakow, a real estate agency in Rhinebeck, said prices for the phase-one condos ranged from $320,000 to $420,000, depending on the floor plan and upgrades. Some units have hardwood floors, custom kitchens and Jacuzzis.
Page said there was only one other luxury condo complex in the area. She said there was strong demand because so many baby boomers were downsizing. Page said she expected construction to resume on phase two in the spring, although she wouldn”™t provide details.
