With construction of the 28-room boutique hotel New Paltz Way well underway, developer Jesse Halliburton returned to the Village of New Paltz Planning Board last week with a more modest proposal: converting a three-bedroom house at 13 Water St. into a one-bedroom residence for employee use and short-term rentals.
Halliburton and business partner Ryan Giuliani started work on the $12.61 million, three-story inn at 11 Water St. earlier this year after the Ulster County Industrial Development Agency (IDA) unanimously approved $1.06 million in tax incentives for the project. The duo previously opened Woodstock Way Hotel, Hudson River Way in Saugerties, and Kingston Carriage House. Halliburton is the owner and principal broker of Prime Real Estate Group in New Jersey, while Giuliani is president and co-founder of boutique hospitality firm Giuliani Social alongside his wife, Mary Giuliani.
Originally called Water Street Trails Hotel, New Paltz Way is being constructed alongside the Wallkill River and the Wallkill Valley Rail Trail, and replaces a sprawling former box factory standing on the 0.82-acre property. Upon completion, the 21,000-square-foot hotel will include a self-led wellness center, a coffee bar and a vegetation-covered living roof. A small restaurant was in the plans for some time, but was deemed unfeasible and abandoned.
Hybrid housing
Planning Board member Rachel Lagodka said she hoped the adjacent 13 Water St. project would favor employee housing.
“I’ve always been a major proponent of having people who work in a place be able to live on the premises or near premises,” she said. “And the way you worded there is that you would have employees who live there except when you don’t have any employees to live there, and then you’re going to Airbnb … or short-term rent it.”
Halliburton said that in his experience, employee housing is difficult to sustain as a long-term option because workers often move out after a short period, leading to frequent vacancies.
“Nobody actually stays for an extended period of time,” Halliburton said. “We’ve done this on two different properties, and we’ve had transient employees that have come and stayed for six months, or they’ve come and stayed for two months, or a couple of weeks. So what we’re proposing is in between those stays that we have the ability to manage it as a [short-term rental] room.”
The new application would see the demolition of much of the existing structure at 13 Water St., maintaining the basement level. The existing first and second floors would be torn down and replaced with a 460-square-foot first floor with a kitchen, living room and powder room; and a 343-square-foot second floor with a bedroom and full bath.
The house is built into a hill, so the basement and first floor are both technically at ground level. The basement, which is technically in the floodplain, would primarily be used for storage by the hotel. The first and second floors are above the floodplain level.
“They’ll be building the living areas out of the floodplain, even if they are in the floodplain,” said Mike Baden, the village’s director of planning, zoning and code enforcement.
“The living area is high enough above the floodplain that it may be no issue.”
Halliburton said that the general manager of one of their other properties recently decided to move to Hawaii.
“I’m happy for her that she’s moving to Hawaii, but I’m not psyched that she’s leaving us because we really liked her,” he said. “So we’re going to need to find somebody, and that person may come up from the city, they may come from someplace else where we’ll be able to house them in a place like this for a time until they find their own place, because that’s typical of what’s happened. People have stayed with us for a time, and then they found their own place along the way.”
A public hearing for the proposal was set for Tuesday, Sept. 2.
Join the family! 
