Reconciliation Uncertain In Wake Of Failed Land Deal In Sandwich

The Tsakalos Realty Trust may not be done with its South Sandwich Village proposal just yet.

After announcing Tuesday its intentions to walk away from the development plan, the trust has proceeded to invite Sandwich residents to review the recent record, e-mail their thoughts to the board of selectmen and town manager, and address the selectmen in the public comment sections of their meetings.

The town, however, appears to be done with the trust’s proposal, an ambitious deal that relies on the purchase of 56 acres of town-owned land.

“We didn’t fire them,” James W. Pierce, chairman of the board of selectmen, said. “They quit.”

Mr. Pierce said the town is not closing the door to a future deal with the trust involving part or all of the land. But Mr. Pierce said the trust would have to respond to a new formal request for proposals—a process that would be open to other developers.

The trust, which had been scheduled to submit a development agreement application by March 1 on the project with the Cape Cod Commission, has asked the public to share its views on the South Sandwich Village issue with the selectmen.

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“The selectmen are convinced that they are doing what is best for the Town of Sandwich,” trustee Thomas Tsakalos wrote. “It may be too late to salvage my dream for South Sandwich Village, but it might help future development in this town.”

Asked yesterday if the trust was seeking to enlist the public’s help in reaching some sort of rapprochement with the selectmen, trust general manager Peter Dubay said, “I would say if the tone changes, there’s a crack in the door.”

Mr. Dubay said Mr. Tsakalos “was disappointed and frankly hurt” by the manner in which the selectmen addressed him at a January 29 workshop at town hall on the South Sandwich proposal.

The trust, Mr. Dubay said, would welcome an approach by the town that was less adversarial and involved less “micro-managing.”

“This isn’t personal,” Mr. Pierce said yesterday in response. “It’s a business deal.”

Mr. Pierce said outside analysis and the judgment of town officials raised serious doubts about whether the Tsakalos Trust could deliver South Sandwich Village as planned.

The chairman also discounted a statement by Mr. Dubay that the disagreement between the town and the trust had become a personality conflict between Mr. Tsakalos and Mr. Pierce.

“I very much like Mr. Tsakalos,” Mr. Pierce said.

But he said that doing a deal on a handshake without performing due diligence would not do the trust nor the town any favors.

The chairman said yesterday that he had not been flooded with comments about South Sandwich Village. As of 2 PM, he had received three e-mails.

“The avalanche didn’t materialize,” Mr. Pierce said.

The selectmen scheduled an executive session following last night’s workshop on town capital needs to discuss the 56 acres.

On Tuesday, the Tsakalos Trust announced that it had dropped its plans to buy those 56 acres of land owned by the Town of Sandwich to develop a 105-acre mixed-used project to be known as South Sandwich Village.

The village would have been built between Route 130 and Cotuit and Quaker Meetinghouse roads, a section of Sandwich commonly referred to as the Golden Triangle.

The trust was prepared to pay the town $4.8 million for the land, which would have been added to 49 acres already owned by the trust in the Golden Triangle, to create South Sandwich Village.

Town manager George H. Dunham said Tuesday that the village would have consisted of 1.7 million square feet of building space. Mr. Dubay said the village would have consisted of one-third residential, one-third office and one-third retail.

On Tuesday, shortly after the trust announced that it would not go forward, the town issued its own press release.

According to the release, the selectmen met in early November and reviewed the Tsakalos Trust proposal in detail. The release also stated that an independent audit of the Tsakalos Trust raised serious doubts regarding the trust’s ability to finance the project through completion.

“It is in the interests of the Town of Sandwich that the project produce more annual tax revenue than it consumes in municipal services,” the town stated. “As proposed the project does not appear to do so.”

In a letter dated December 19, the town stated, the selectmen expressed those doubts to the trust, following by the January 29 workshop at town hall.

“Apparently Mr. Tsakalos decided to withdraw preemptively,” the town stated.

As of Tuesday, the trust also announced its intention in a letter to drop its plans to redevelop its existing holdings within the Golden Triangle, and to build a related wastewater treatment facility with a capacity of more than 500,000 gallons a day.

In Tuesday’s letter, which was addressed to Mr. Pierce, Mr. Tsakalos wrote, “The basic dilemma, as I see it, is that the board of selectmen wish to know who my potential development partners will be and what tenants they may bring—while the potential development partners I have spoken with have indicated that they will only seriously consider developing in Sandwich after I have secured the necessary permits and approvals.”

But Mr. Pierce said the town had a legitimate interest in knowing ahead of time details regarding what would actually be built.

The selectmen, he said, would prefer to regard the requests as due diligence regarding potential tax revenue verses possible added demand on municipal services, for example, education and emergency medical services.

But Mr. Pierce said very little detail was offered by the trust.

The chairman further said the town did cut the Tsakalos Trust some slack, given the businessman’s investment in and dedication to the town.

According to Mr. Pierce, the trust’s response in December 2012 to the request for proposals issued in September 2012 did not include financial data required by the request.

“We considered declaring the proposal non-responsive,” Mr. Pierce said. “But, in deference to the [trust’s] record of service to the Town of Sandwich, we extended the deadline.”

On Wednesday, the executive director of the Cape Cod Commission, Paul J. Niedzwiecki, sent Mr. Pierce a note about the trust’s decision to pull out of the deal.
“I was disappointed to learn of the Tsakalos Realty Trust development proposal withdrawal,” Mr. Niedzwiecki wrote. “Tom Tsakalos and his team have been community leaders and the commission was looking to the Town of Sandwich and the Tsakalos team to forge the first 3-party development agreement on the Cape.”

Mr. Niedzwiecki said the commission is committed to working with the selectmen and town staff to prepare a growth strategy for the area.

The commission hopes to attract long-term sustainable development to not only stimulate the commercial tax base, but decrease the financial burden on year-round residents and the town.

“The work put into development plans for South Sandwich Village to date puts the town in an excellent position to attract a new developer for that valuable property,” Mr. Niedzwiecki said.

But Mr. Dubay has his doubts. He rated the town’s chances of finding another developer to put together a project like South Sandwich Village at one in 100.

In his Tuesday letter to Mr. Pierce, Mr. Tsakalos wrote, “I am disappointed that my vision will not become a reality because I sincerely believe that it was in the best interests of the residents of the town of Sandwich.”

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