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Oyster Bay real estate investor runs upstate fish farm

Michael Spielman, an Oyster Bay real estate investor,

Michael Spielman, an Oyster Bay real estate investor, nets some of the fish growing in saltwater tanks at an upstate fish farm. He had leased, then sold, the property to a company that has now gone bust. He took over the property and the fish through foreclosure. (Sept. 10, 2013) Credit: Hans Pennink

Michael Spielman never fancied himself a fish guy.

Still, the Oyster Bay real estate investor suddenly found himself the owner of a saltwater fish farm -- and its 300,000 fish -- last month. Spielman held the mortgage on the property, and inherited the farm in upstate Greenport Town when it shut down and left its employees and fish in the lurch.

The farm, Local Ocean LLC, abandoned its operations in early August, said Greenport Town Supervisor John Porreca. "Every single member of the management team was gone," he said. The employees "weren't even sure they were gonna get paid."

Executives at Local Ocean did not return requests for comment. Former chief executive Efraim Bason said he left the company in 2012 when he did not see eye to eye with its investors.

Spielman, who leased, then sold the 31-acre property to Local Ocean in 2010 for $3.3 million and issued a mortgage to the farm operator, took back the land through foreclosure in mid-August.

The property, however, had been through a multimillion dollar makeover into a zero-discharge fish farm. It now contains 120 sprawling concrete tubs of saltwater filled with sea bream and European sea bass in various stages of growth, which Spielman said he had to care for to avoid any environmental repercussions from smells and decay if the fish died.

Learning a new profession

Spielman, 73, a Long Island native who once ran a small business that manufactured appliances, said he has zero experience with aquaculture. He decided to take back the property because he believed it was valuable -- even with its fishy baggage.

"At no point in my life did I expect this," Spielman said. "I own real estate . . . but for about two weeks now, I've been in the seafood profession."

For now, he has set up the farm under the new corporation Go Fish Farm Inc. and relies on six former Local Ocean workers that he has hired back on his own dime. The employees work round-the-clock shifts -- feeding the fish, tracking oxygen levels and checking the pumps.

But Spielman doesn't plan to raise fish for long -- his goal is to liquidate his inventory by October and sell the property to another aquaculture company.

"I'm not raising any more fish to sell," he said. "I'm going to be basically disposing [of] and feeding the fish I inherited."

Local Ocean's old pool of customers -- grocery stores and restaurants -- has been contacted, Spielman said. The younger fish will be marketed to fishermen, who may use them as bait.

Local Ocean had been heralded as a bright spot for the upstate region when it opened in 2009, backed by foreign investors and utilizing sustainable practices developed in Israel, Porreca said.

Moving forward

In its heyday, Local Ocean hosted Sens. Charles Schumer (D-N.Y.) and Kirsten Gillibrand (D-N.Y.), and received tax breaks from Columbia County and grants for energy bills, according to local news reports. Now, all that remains is a skeleton crew, concrete pools of saltwater -- and schools of fish. Porreca said Local Ocean had been hit by lawsuits from investors in the last year and missed payments on bills.

Six aquaculture businesses have already contacted Spielman expressing interest in the farm -- without the fish. If the property is sold to a freshwater fish farm, it would be up to Spielman to dispose of the saltwater -- over a million gallons -- in addition to the fish. Spielman said he is still working with the town of Greenport on a removal method.

Despite the murky outlook, he said he would be happy if he could sell all of his farm's inhabitants and break even. He remains cautiously optimistic about his new, albeit temporary, line of business.

"It's exciting," he said. "It's the business of the future."

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