A locked steel gate at the entrance to a paved entry road off County Road in Oak Bluffs has not kept out the vandals responsible for breaking every window in the only two partially constructed and defaced model houses on the property, known as South Woods Farm. The pond that was to have been the centerpiece of an equestrian-themed subdivision of 26 luxury home on 90 contoured acres remains just a sandy crater in the midst of oak trees and pitch pines.
Now, after more than a decade in limbo, the fate of the moribund subdivision will be decided by Patten Companies, a family-owned network of companies based in Williamstown with a long history and national track record of successfully financing, selling, developing, and marketing recreational and residential properties in rural locations across the country.
South Woods Farm is the remnant of the dream Corey Kupersmith of Greenwich, Conn., once held of developing a golf course in Oak Bluffs on a swath of land now known as the Southern Woodlands. The Martha’s Vineyard Commission (MVC), the Island’s powerful regional permitting body, dashed that dream, and Mr. Kupersmith followed up with litigation and development threats.
The dispute was settled when the Martha’s Vineyard Land Bank purchased the majority of Mr. Kupersmith’s property and the MVC approved the South Woods Farm subdivision. Construction began with two model homes, but was halted after Mr. Kupersmith’s financial foundation fell apart.
In 2012, Farlap Development Corp., the original development company controlled by Mr. Kupersmith, filed for Chapter 11 bankruptcy.
The mortgage, valued at almost $5 million, reverted to People’s United Bank of Connecticut, which has repeatedly offered to sell its right, title, and interest in the property. Foreclosure auctions were scheduled and rescheduled due to Mr. Kupersmith’s legal entanglements.
Michael Patten, chief executive officer of Patten Companies, told The Times one of his family’s subsidiary companies, National Land Partners, recently purchased the mortgage, and now plans to conclude foreclosure proceedings.
An auction is scheduled for Friday, June 26.
What they do
“We’ve developed communities all over the country, and done business in 40-plus states over the years,” Mr. Patten told The Times in a telephone conversation Tuesday.
Following the recent real estate downturn, the company began buying broken bank projects. “We get the projects back, we fix them up, we take care of all of the issues,” he said, “and turn around and market them. We’re sales and marketing guys, that is what our company is really all about.”
The company learned about the Kupersmith property through its many banking connections. Over the course of the past three years, as the property gyrated between bankruptcy, foreclosure, and canceled auctions, Patten Companies was in contact with People’s United Bank.
“We offered to buy the note from them and take that off their hands, so they didn’t have to deal with all that,” Mr. Patten said. “We were too far apart for a long time, and it just took a long time, it was probably three years of back and forth, and they finally said yes.”
Patten Companies does not own the property yet, and may not. On June 26, auctioneer J.J. Manning will auction the property.
“One of two things will happen,” Mr. Patten said, “A, we will have enough bidders and we will have an auction, and someone else will buy it at foreclosure; or B, if we are unhappy where the bids are coming in, we will bid it in and take it back, and we will do what we do, which is finish up the project, and market and sell the lots to end users and to builders.”
Mr. Patten said he will be happy either way, but he expects the property to go at auction based on the level of interest — 91 builders/developers ready when the property was previously scheduled to go on the auction block — and continued inquiries about the property.
Mr. Patten declined to put a value on the property. “We’re going to let the auction price it,” he said.
Pressed for a number he said, “Those are larger than average lots, and looking at the comparables around, I’m sure a lot of similar stuff is selling in the $400,000–$500,000 range, and we’ve got 20 of them, a couple with houses on them.”
Four lots in the development were earlier sold to private buyers, and are not listed in documents related to the bank sale. The remaining two lots were owned by a separate company and are now controlled by a bankruptcy trustee. Any proceeds of that sale would got to the ex-wife of Mr. Kupersmith.
“Martha’s Vineyard is obviously on the way up,” Mr. Patten said about the appeal of the real estate market. “It is on the rebound.”
The appeal of this property, he said, is that it is subdivided and ready to go.
Speaking generally about the national building economy, Mr. Patten said, “I see things picking up everywhere we do business; all around the country there seems to be a building boom going on. In the starter homes, lower-priced stuff, there’s a shortage, but the second-home market just really in the past year has taken off again, and is heading up.”
According to tax records, Farlap Development Corp. owes the town of Oak Bluffs $395,074 in back taxes. Mr. Patten said back taxes will have to be paid after foreclosure by the winning bidder at auction.
Golf war history
Whatever the future holds, it will be the final chapter in the saga of the effort to build a new golf course in Oak Bluffs that began when the 88-acre Webb’s Camping Area, part of approximately 400 acres of land now referred to as the Southern Woodlands, went on the market.
The camping area had been for sale for years. An offer by the Martha’s Vineyard Land Bank was refused, and in 1998 a golf course development company announced that it had an option to purchase the property.
Webb’s abutted property the course developers needed for their project. The town of Oak Bluffs was one of dozens of landowners of private landlocked parcels, many with unclear titles.
The company went to work clearing titles and acquiring more parcels. When their efforts stalled, Mr. Kupersmith, a wealthy golf enthusiast and pharmacy entrepreneur from Greenwich, Conn., took over until he owned some 280 acres.
Mr. Kupersmith approached the town and MVC officials with a plan to develop an 18-hole golf course, and offered a benefit package he thought would be eagerly embraced. At one point the development included public walking trails, payments in lieu of taxes, an offer to lease a portion of the former Webb’s Camping Area to the town at no cost for camping, and a permanent conservation restriction over the entire property.
At the same time, two groups of rival developers were engaged in their own efforts to build golf clubs. The backers of the Meeting House Golf Club adjacent to Edgartown Pond ultimately gave up following MVC rejection of their plan, and joined with backers of the Vineyard Golf Club, built on the site of a failed 148-house subdivision off Edgartown–West Tisbury Road.
Land Bank held the key
In March 2005, capping years of fierce controversy over Mr. Kupersmith’s various development proposals, which included MVC rejection of three successive applications, and numerous lawsuits filed against the commission, the Land Bank, Mr. Kupersmith, and the MVC concluded a deal under which Mr. Kupersmith agreed to sell 190 acres of the Southern Woodlands to the Martha’s Vineyard Land Bank for $18.6 million, contingent on MVC approval of his subdivision.
The luxury housing development was intended to bridge the financial gap between what the Land Bank was willing to pay — that is, approximately $100,000 per acre — and Mr. Kupersmith’s asking price of $26 million.
The agreement included a provision under which the Land Bank would swap a 24-acre rectangular town-owned lot, known as the “doughnut hole” because it was landlocked, for “more convenient acreage located elsewhere in the Southern Woodlands, contingent on town meeting approval.”
Despite a 2004 written agreement, the land swap has yet to happen. The potential sale of the Kupersmith development does not involve any parcels in the land swap agreement.