GloucesterTimes.com, Gloucester, MA

December 5, 2012

Sale deal expires for Essex Ave. hotel

By Richard Gaines
Staff Writer

---- — The three-year-old, purchase-and-sale agreement has expired for acreage on the Annisquam River, where the City Council had approved plans for a 92-room Hampton Inn & Suites.

Without an extension — and time to resolve an abutters’ suit and clarify sewerage engineering — the project is as good as dead, the development team said Wednesday.

In a letter to the editor in today’s Times (See Opinion, Page 6) and in a telephone interview Wednesday, developer David Hill of Easton, Md., and his spokesman, Suhail Partawi, said they could not continue the effort without an extension of the option on the property negotiated with Jerry and Carol Hill.

The chance of seeing a Hampton Inn & Suites on the river have dimmed less than a month after the state also dealt a setback to the city and the development team of a 101-room Pavilion Beach-front hotel on the former Birdseye site on Commercial Street by excluding Gloucester from 2012 funding in the MassWorks infrastructure program. The city had submitted an application for $5 million to modernize the drainage, sewage and water systems in the historic Fort enclave, and was surprised to have been zeroed out in the competition. The state approved $38 million for 26 communities.

Mayor Carolyn Kirk has supported both hotel projects, but as the Beauport Gloucester Hotel gathered momentum — passing a major hurdle in June with the approval of a hotel overlay zone that made the marine Industrial site legally viable for a hotel — attention was diverted from status of the Hampton Inn project.

The local Hills — now of Key West, Fla. — are the longtime former owners of the Yankee Fleet, which had been based on the Annisquam River, at the Cape Ann Marina, property just south of the 50 acres optioned to to Hill Hospitality LLC.

In 2008, Jerry and Carol Hill sold the fleet, featuring five boats of 75 to 100 feet in length to employees and retired. Jerry Hill, then 79, had done his first charter as a teenager in 1943 — accepting $2 to take swimmers on his small sailboat for a tour of the Little River -- and organized the business in 1944. It was believed to be the first deep sea fishing and charter business on the East Coast and grew into an Cape Ann economic engine, with as many as 90,000 customer trips a year beginning in early spring and ending in late fall with customers coming from other states to fish and look for whales.

In a telephone interview Wednesday, Jerry Hill said he had grown tired of waiting for David Hill — no relation — and his company to close on the acquisition.

But he added he would not be averse to negotiating a new purchase and sale deal that could give the developer more time to deal with the abutters’ suit, filed in Massachusetts Land Court, and determine the engineering needed to link the hotel into an eight-year-old sewer line — one that has been found wanting by a consultant to the city and has produced backups in homes near the site of the would be Hampton Inn & Suites.

Jerry Hill referred questions about the expired and any new agreement to his attorney, Michael Faherty. Faherty’s secretary said he was on vacation and unavailable Wednesday.

Partawi, David Hill’s spokesman, said, “The matter has been taken out of our hands, because the option on the property has expired, and we’ve not been given an extension.”

In his letter to the Times, David Hill described the hurdles to groundbreaking.

“First, some neighbors appealed the decisions of the Conservation Commission and City Council to approve the project,” he wrote. “This, in turn, led to protracted litigation which we feel ultimately would have won. The land owners (Jerry and Carol Hill) are no longer willing to wait; however, in defense of the land owners, the contract is over three years old.

“The second reason relates to the sewer system along lower Essex Avenue, which has been deemed inadequate,” David Hill wrote. “The city has given us no guarantees regarding the timeline to eventually tie into the Essex Avenue sewer line. Again, the land owners were no longer willing to wait.”

In May 2011, the City Council voted to approve a special permit for the Hampton Inn project to be built on four acres surrounded by salt marsh just north of the Cape Ann Marina. Among the conditions written into the permit was language requiring the Department of Public Works to approve the sewer connection design.

But Mayor Kirk and Public Works Director Mike Hale both said the Hampton Inn & Suites faced no special hurdle due to the limitations of the sewer system, whose main at the point of hookup with the hotel was installed in 2004.

Kirk said the hotel might be required to hold sewage and pump it into the main and down the street to the plant on off hours.

However, Partawi, spokesman for the Hampton Inn & Suites project, said that “in the special permit, we don’t have the right to tie in.

“The special council permit was made contingent on permission from DPW,” he said, “and our (belief) is that can only happen after repairs (to the Essex Avenue sewer line). We need more time for those things to happen.”

About two dozen abutters along Essex Avenue sued to stop the project. The Land Court case was projected by plaintiffs’ attorney Mark Nestor to last at least a year.

Partawi said the city would be the loser if the river hotel project failed.

“The whole marketing arm of Hilton Worldwide (which licenses Hampton Inn & Suites) would be mobilized to attract people to this beautiful city,” he said.

Richard Gaines can be reached at 978-283-7000, x3464.