The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The developers behind the proposed $110 million Port St George project on Long Island yesterday said they would “be surprised if something doesn’t move this year” on finding a joint venture partner to move the development forward.

Ian Moorcroft told Tribune Business that he and his business partner, Jon Houghton, were taking a “circumspect” approach with their plans, seeking in the first stage to capitalise on their 300-strong “client bank” in the existing Stella Maris subdivision.

Mr Moorcroft, Stella Maris Village’s chief executive, said the developers had sold lots in the subdivision at the rate of 100 per year pre-recession, and after “surviving the storm” were looking to use these sales as a stepping stone to starting Port St George.

Potential lot buyers, he added, had started “coming out of the woodwork last year, indicating market demand was starting to pick up post-recession, and 300 such inquiries had been received year-to-date.

“This time last year, you’d have not generated 300 inquiries if you’d thrown $500,000 a year at it,” Mr Moorcroft told Tribune Business.

“It’s been off the back of one e-marketing campaign we did, and it sort of sprung out. I don’t know if people handed it out to other people or told them.

“Half of them are tyre kickers; you have one conversation with them and it doesn’t go anywhere. That still leaves half to work with, and then you lose half of them.”

Mr Moorcroft said that with Port St George requiring “huge amounts of spending on infrastructure” to gain subdivision approval, he and Mr Houghton had decided to focus on the existing Stella Maris subdivision and the lots they own there.

The duo own around 10 per cent of the 2,600 subdivision, most of it having been sold previously by Joerg Friese and his partners, but it already has the necessary subdivision approvals, with all utilities and infrastructure installed.

And, having sold 300 lots already, Messrs Moorcroft and Houghton’s strategy is to encourage those purchasers to start constructing their own homes plus find buyers for the remaining land.

“What we’ve done is look at it in a different way,” Mr Moorcroft revealed. “We can get on with it, get revenue streams and look at Port St George as the next phase to go after.

“What we did in our first phase, we sold under 300 lots at Stella Maris in conjunction with the previous owners. That gave us a client bank to go back to, to talk to them about building on their lots.

“We’re hopeful that another five or so homes will go up as a result of that, and that other business comes along as a result of the ongoing marketing. We know we’ve got that sort of sales potential in the pipeline.”

While it was possible they may seek to do Port St George themselves, Mr Moorcroft said it was “more likely” they would try to find a joint venture partner to share the burden.

Emphasising that his and Mr Houghton’s priority was to find the right partner, Mr Moorcroft said Port St George’s construction start date would depend on whether they chose this route, and when a deal was closed with the right candidate.

“It depends entirely on which route we take,” he told Tribune Business of Port St George, which received all its government ‘approvals in principle’ in 2007-2008.

“The track we expect we will take, because my phone is ringing with inquiries about it, we will end up doing a joint venture on it.

‘I’d be surprised if something didn’t move on that this year, because of the sort of conversations that have been going on in the background, but a deal’s never finished until it’s done.”

Explaining the reason for his cautious optimism, Mr Moorcroft added: “It’s not that the type of conversation is different; it’s the quality of people I’m having them with that is different, if that’s not too insulting to the people I spoke to last year. It’s a different level of player back in the market.”

When it was unveiled in 2007-2008, Port St George was billed as creating over 300 jobs on a 951.4 acre site in northern Long Island. It featured plans for a boutique hotel with 146 suites/villas; 60 boutique villas; more than 300 residential lots and 331 multi-family lots; and marinas with numerous boat slips; plus golf courses, a Town Centre and other resort/community amenities.

The project was projected to have an annual economic impact of between $54-$90 million, and at the time the developers had also signed a 25-year management agreement with Langham Hotels International. Some 875 construction workers were forecast to be employed over the build-out phase.

Mr Moorcroft said his and Mr Houghton’s overall plans for Port St George had not changed, although they had built in flexibility

He added that the developers would be “very careful” in selecting a joint venture partner, saying: “We’re not going to start making rash decisions and get it wrong at the last minute.

“It will be a case of being patient until the right people to put a joint venture together with come along. There are still quality people out there to do business with. Most of them have been sitting on their hands and money for the last five years, waiting for the world to turn around.

“We’re very willing to speak to them,” Mr Moorcroft said. “What we’re not going to do is jump on the first thing that comes along, and be a little more patient and wait for the right thing to come along. We don’t want the solution to become the problem, so we’re being a little more circumspect.”