Deal to renovate Hampton Bays inn in works

Hampton Bays' dilapidated Canoe Place Inn could be filled once again with festive partygoers if a deal goes through allowing the owners to build town houses across the Shinnecock Canal in return for renovating the historic landmark.

Canal Properties, a subsidiary of prominent Long Island developers Gregg and Mitchell Rechler's RSquared HB Llc of Melville, came before the Southampton Town Board earlier this month to lay out a plan that includes renovation of the inn, which the local historical society says was built in 1739. The structure has been expanded and renovated over the years.

The developers' original plan, according to Brenda Sinclair Berntson, president of the Hampton Bays Historical & Preservation Society, was to raze the structure to build town homes, which is allowed under the current zoning code for the property. Threats of lawsuits and community outcry, especially when it was learned that RSquared owned land on the other side of the canal, resulted in packed town meetings and thousands of signatures on petitions. The Rechlers, who have owned the property since 2004 and have spent about $8 million on the acquisition and related processes, sought a compromise to salvage their plan.

Those new terms would bring a full renovation of the inn, located on the corner of Montauk Highway and Newtown Road, as a 25-unit bed-and-breakfast and catering hall for large events, such as weddings, as well as a public tap and grill room. It would contain a covenant with the town restricting use of the inn for any other purpose, according to testimony at the April 8 meeting, such as its previous incarnation as a nightclub. Five cottages on the property would also be restored.

In exchange for the cost of repairing the inn and revitalizing its landscaping, the developers would build 40 town homes with boat slips on the east side of the canal, a recreational facility and pool, and a sewage treatment plant. The development would be taxed at full assessment and include public access to the water.

The proposed development, now favored by most town officials and the Hampton Bays community, must now go through the approval process, including New York's State Environmental Quality Review Act, and change of zoning.

Berntson said she was "absolutely thrilled" with the plan. "I really credit them for listening," she said of the developers.

Some speakers worried about flooding issues on the side where the town homes would be built, but most were happy with the plan.

"I see nothing but good, positive things from it," said Richard Joslin, who once lived on the property as a teenager.

Gregg Rechler, managing partner of RSquared, said he was glad the community and his company could reach such a beneficial compromise, and wants to be part of the "Hampton Bays fabric."

"I'm glad we were able to get together with the town and definitely the community," Rechler said.