City money, country business

Taavo Somer (photo by David Prince)

Another resort hotel for Ulster County is on its way, and this one has deep pockets and entrepreneurial leadership.

On November 14, the Ulster County Industrial Development Agency heard the details of a $21-million project to transform the former Rondout Golf Club on 137 acres off Bank Street in Accord into a full-service hotel, resort and golf course. As presently proposed, the project will consist of a nine-hole golf course, a twelve-room hotel, 14 individual duplex cabins, a 4200-square-foot “event barn,” about 7500 square feet of restaurant, café, retail and lobby space, an outfitter retail space, a 2000-square-foot spa and gym, two tennis courts, a swimming pool, walking trails, and flower and vegetable gardens. 

The Town of Rochester’s planning board earlier this year approved the project and provided it a negative environmental impact statement. The DEC and the state Department of Health will continue to monitor it. 

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At its meeting last week, the Ulster County IDA authorized staff to schedule a public hearing in Rochester on the developer’s application for a standard tax break estimated at $683,000 over ten years. The project will create 30 construction jobs and about 20 full-time-equivalent permanent jobs.      

The developers recently bought the property for $2.4 million. In its application, Inness NY, LLC expressed the hope that construction can begin early next year and be completed in the spring of 2020.

The ownership of Inness NY, LLC makes clear this is not the small-scale, scrappy, low-capital outfit of many recent local hospitality ventures. One of the latter, Star Distillery in West Park, appeared at the same IDA meeting last week. Star has been embroiled in banking and paperwork problems since the IDA approved its application for tax relief three years ago. It now hopes to move forward on opening the distillery in 2019 and the rest of the project later.

Inness NY, LLC consists of four partners, each with a 25 percent ownership share. One is project manager Taavo Somer, who has lived part-time in Rochester for a decade. His wife and kids now live full-time in a stone house the family bought and fixed up in Rochester while he pursues business interests in New York City a few days a week. Though perhaps best known for the rustic American-style restaurant design pioneered at Freemans Restaurant in the Lower East Side in the early 2000s, Somer has branched out both occupationally and geographically. 

“The thought of not living here [New York City] full-time was such a foreign concept to me,” he told one recent interviewer. “‘I don’t think that’s possible; you can’t move outside of the city.’ After I did it, and I would come back, it was like, ‘Actually, you can move out of the city, and not only that, but there are other parts of the country, other parts of the world, that I wouldn’t mind living in.’”

The other three 25 percent partners in Inness are Charles Blaichman of CB Developers, a decades-long part-time Woodstocker; Michael Barry of Ironstate Development in Hoboken; and Scott Shnay of SK Development Group in New York City. The three downstate developer entities have collaborated as joint owners on hundreds of millions of dollars of properties in New York City. 

The three are also partners in Hudson Valley Kingston Development LLC, the current multi-site bed-and-breakfast development in the Kingston Stockade neighborhood whose flagship restaurant and B&B, the former bank at 301 Wall Street, is scheduled to open soon. Ironstate last year lost a bidding war for the Kingston school district’s Cioni Building to another New York City developer.

Somer said he met Blaichman a couple of years ago through the auspices of local broker Nan Potter. Somer was looking for office space in Kingston. The two entrepreneurs discovered they shared an interest in transforming exurban locations with a sense of place and belonging into successful business environments.  

The soft-spoken Somer explained to the IDA last Wednesday how the reworked Rondout golf course would occupy half the land and the resort the other half. He explained how Inness’ business model (the name is a tip of the hat to nineteenth-century Hudson Valley impressionist landscape painter George Inness) differed from that of the financially troubled Hudson Valley Resort (which “wasn’t really a resort”). It would have a retail element and a golf-membership base, and would be “design-oriented” (Somer and his wife have strong backgrounds in that expertise). It would appeal to three market segments: weekenders without second homes, weekenders with second homes, and local people. 

The Accord location, Somer said, would encourage tie-ins with local agritourism, recreational and cultural activities, and with the area landscape itself. He explained later in the week that he was seeking to create a destination centered on the beauty of the region, with activities both on and off the property. The various things to do would “play off each other” and build a core of people “united by a sense of place and belonging.” 

Noting the large equity portion of the project, the IDA members wondered why the applicant needed the tax break. New York State is more concerned with developers creating the number of jobs they promise than with their need for the available tax breaks. The Ulster IDA application reads, “Would this Project be undertaken but for the Agency’s financial assistance?” 

“No” is the de-facto default answer. A “yes” would entail rejection of the application. Why apply for something one doesn’t need?

The six IDA members (Rick Jones recused himself because of his former involvement in Rochester planning) were cautious in their assessments. “You’re creating a destination resort,” ventured agency chair Randall Leverette. “Not a golf club but an events place.”

“It’s an aggressive project with a lot of unknowns,” said member Jim Malcolm.

The IDA instructed staff to set up a public hearing for Inness NY, LLC in Rochester. Somer expressed the expectation of local support for the project, as did Rochester town supervisor Mike Baden.

There are 2 comments

  1. 25 yr. Manhattanite

    The IDA is redundant when it comes to “tax breaks” for commercial classed properties. Commercial classed properties don’t pay a commercial tax rate because there is no commercial property tax rate different and higher than non-commercial property tax rates.
    “City-money “my ass.

  2. Steven L Fornal

    I love this project. Hope it happens.

    However, a $683,000 tax relief gimme for 20 full-time equivalent jobs (meaning non-benefit, non-living wage jobs) doesn’t seem like such a sweet deal for taxpayers.

    When are we going to demand entrepreneurs actually engage in the risk they always yammer about and use their own money for projects? We hear the incessant clamoring re Free Enterprise and Free Markets yet what we constantly get is socialized costs with privatized profit-sharing.

    I’d love for the IDA to actually put out the numbers to show how such give-aways are positives for taxpayers. And, of course, clawback clauses MUST be included in the CONTRACT. If the jobs promised aren’t delivered we get the money back.

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