At a special meeting in June of the Village of Sag Harbor’s planning board, a local detailed his opposition to Adam Potter’s planned mixed- use development with an affordable housing component.
It wasn’t that the community didn’t like Potter, the speaker said. They just didn’t know him enough.
By then, you’d think the developer had been around long enough to be known: He proposed his first project in 2020 and has been trying to put up something in Sag Harbor ever since — commercial, residential and artistic. But Potter has remained a mysterious figure in Sag Harbor through this process.
Developers frequently endure long, slow approval timelines. Potter has tried to push through setbacks while the locals who are aware of his plans spiral into speculation and question his motivations and financing.
Potter’s plan is to build an affordable housing complex in Sag Harbor. Initially, in a project linked to the redevelopment of the village’s Bay Street Theater, Potter had proposed 79 units on 5 acres between Bridge and Rose Streets.
The latest iteration, the subject of the recent board meeting, is a development over two parcels at 7 and 11 Bridge Street with 7,900 square feet of commercial space — though not for retail — and 44 apartments, of which 16 would be affordable.
In a place with few new development opportunities at all, and even fewer that don’t end in multimillion-dollar single-family-home listings, Adam Potter is resolute about $1,800 rentals.
Why? It’s simple, he said: “Sag Harbor desperately needs some affordable housing, because we have none.”
Other side of the Sound
Potter’s home base is Connecticut. He owns a landmarked home in the Riverside section of Greenwich overlooking Long Island Sound with his husband, who originally hails from Long Island, and two daughters.
Potter didn’t start out in real estate. As a risk management executive for American Airlines, he handled the crisis response after the 9/11 attacks; he was also an executive at Warner Music Group. Later, he founded a professional association in the litigation management industry and bought a trade publication called Business Insurance in 2016, selling it three years later. He had turned it around financially and operationally, according to an announcement at the time.
Potter has owned other residential real estate properties in and around New York City and the Hamptons. In 2015, he sold an Upper West Side co-op to the New York Times’ then-publisher and chair, Arthur Sulzberger Jr., and his wife, Gabrielle, for $2.8 million.
He was introduced to the East End, he told The Real Deal, when he rented a home in Springs in East Hampton and found he “loved the area.”
In 2008, he purchased a home in Springs, and has since acquired a neighboring property on Three Mile Harbor Hog Creek Highway.
Although Potter is currently only a part-time Hamptons resident, he has gotten involved in community charitable efforts. In 2022, he offered his guest house to a family fleeing the war in Ukraine and staying with friends in Riverhead. The family enrolled a son in Springs School, and Potter organized a donation drive for them, according to a 27East interview with the family that year.
“Sag Harbor desperately needs some affordable housing, because we have none.”
Potter has also launched several restaurants, including Village Bistro, which recently opened in East Hampton. Hal Zwick of Compass has worked with Potter on hospitality deals, and told TRD that he has a knack for them.
Potter said he hopes to make Sag Harbor his year-round home in a few years, after his children go to college.
For the moment, being an outsider has its perks.
By virtue of not being born on the East End and not living there full-time, Potter can see what the community needs in a way that habitués might not be able to, said local Douglas Elliman broker Michael Daly, who is also founder of East End YIMBY, an advocacy group for community housing on eastern Long Island.
Potter’s affordable housing complex, even at a small size, will be 16 more units for vital workers and families than Sag Harbor currently has. Advocates for affordable and community housing agree that every little bit counts, he said.
“He really believes in the idea, and it’s a good project,” Zwick, who has the listings for three properties Potter is selling in Sag, added. “Obviously, the margins aren’t as great in affordable housing as other types of development.”
The affordable proposal is in the midst of a State Environmental Quality Review Act review. The new scope means the project is now classified as “workplace housing,” rather than affordable housing, a distinction that means local residents will get priority.
Not giving up
Potter burst onto the Sag Harbor development scene in 2020, when he created a nonprofit with the stated aim of “acquiring real property on the eastern end of Long Island, New York and developing the real property by building a theater on the property to be dedicated to and to support and preserve the performing arts community in the area.”
The nonprofit, first called Sag Harbor Redevelopment and then the less ominous-sounding Friends of Bay Street, bought a large retail property at 22 Long Island Avenue called the Water Street Shops as the future home for Sag’s professional regional theater, the Bay Street Theater, which had put out a statement saying it wanted a permanent home.
But as soon as Potter let it slip that a tiny percentage of the planned theater complex would be 4 feet taller than the village code’s maximum height, he ran into opposition and roadblocks.
Complicating the brouhaha, village residents discovered at the same time that Potter had other real estate deals in the works with investors other than the Bay Street group. He bought 23 Bridge Street for $3.75 million, 8 Rose Street for $1.5 million and 12 Rose Street for $1.85 million, all in early 2021, all part of the original five-property plan for the 11 Bridge Street mixed-use project.
Some of the outcry over Potter’s mixed-use and affordable apartment plans seem to have stemmed from the idea that the Friends of Bay Street plan, and now this one, were fronts for unknown developers to “gain a foothold in the village,” as a group of critics wrote.
It didn’t help the optics when he explained to the public that he had purchased 11 Bridge Street “to provide new spaces for businesses including those previously based in the Water Street Shops building,” as the East Hampton Star reported at the time. The maneuvering made him look like Robert Moses, a critic said at a public forum — as if he were “endowed … with this massive amount of authority.”
It was not a surprise, then, that Potter’s initial proposal for Bridge Street was met with a wave of opposition and inspired something of a panic among some locals. His plan was called “ghetto” and “repulsive” in one 2022 letter to local newspaper 27East by a resident who alluded to Potter having “tricky financing.” Residents continued to ask for transparency on Potter’s investors, something Potter didn’t feel he had to provide. “We don’t want to live in Pottersville,” other residents penning letters to the editor bemoaned, calling Potter’s amassing of properties “a land grab.”
Last year, Bay Street finally scrapped a plan to build the theater after paying over $13 million for the site and its 15,000 square-foot mixed use building only three years before.
The nonprofit listed the 22 Long Island Avenue site for $25 million in early 2023. This past February, Potter followed suit, listing three of his five Sag Harbor properties.
One, 8 Rose Street, is already in contract, and 23 Bridge has a solid tentative offer, according to Zwick. The properties are zoned for residential or select commercial use, including take-out food and services like salons. 23 Bridge Street listed for $4.3 million, 8 Rose Street for $1.6 million and 12 Rose Street for $1.9 million.
Zwick is also the listing agent on 22 Long Island Avenue, which hit the market for a second time in early June at $34.5 million and is getting a lot of interest quickly, he said — 30 inquiries in two weeks, some serious. Zwick said the price is higher because the parcel is now bundled with a neighboring commercial property at 2 Main Street. The Bay Street group bought that property in 2021 for $18 million.
“They are redevelopment projects: Someone is going to go in and partner with the village and see what they want. They will keep the footprint, it’s on the water, it will enhance the village,” Zwick explained.
He said he did not think that watching Potter’s travails would make buyers hesitant. “People have been watching what’s going on the last three years and think they can work with the village and reach a compromise,” Zwick said. “Anything in Sag Harbor is hot right now.”
The proceeds of the sale of 22 Long Island Avenue will go back to Friends of Bay Street, now called The Complex LLC, and the funders of the would-be theater aren’t interested in Potter’s Bridge Street project — they only wanted to build the theater, according to Zwick.
“I think everything he will do in the future is just him and his money. He’s a smart guy and a good guy, and he really believes in the project,” he said.
Funding the plans
Critics have pointed to a lack of transparency around financing as a reason for their apprehension.
But at the moment, Potter does not appear to have backers, at least on Bridge Street.
Previous partners Conifer Realty and Smith & Henzy Advisory Group pulled out in 2022, according to reports. Getting investors on board “is the easy part,” Potter said, adding that he’ll do it once he gets further in the approval process.
He has had other partners. Developer and Miami Dolphins owner Stephen Ross was one of Potter’s partners in the Bay Street group’s attempts to develop 22 Long Island Avenue into a theater, leading to concerns that the billionaire, whose Related Companies is known for megaprojects like Hudson Yards and who got his start in affordable housing — and for hosting a Trump fundraiser at his Hamptons home — had designs on turning the quaint village into South Beach.
Ralph Heins, director of Friends of Bay Street, also has a commercial development background. Heins and his wife, Cornelia, own Primera Companies, which has developed over 3 million square feet of industrial real estate, though quite far from Sag Harbor, in the Dallas area.
Hamptons developer Jay Bialsky was also part of Potter’s earlier negotiations, according to an associate who asked to remain anonymous. Bialsky, who developed waterfront condos in Sag Harbor, was in talks last year with Potter on the 11 Bridge Street project, the associate said, but didn’t finalize terms.
None of Potter’s previous investors responded to requests for comment.
Potter told The Real Deal in June that the three men are not investors or partners in the 11 Bridge project, and said that as of now he is the sole funder.
Potter’s other projects are modest, though visible, mostly partnerships on restaurants. He is involved in Brent’s Deli in Amagansett and Hampton Eats, as well as Village Bistro. He also plans to renovate — with his own $500,000 — the former Rowdy Hall, also in East Hampton, according to 27East.
“Is there anything this guy doesn’t own?” one Instagram user asked on a post about Village Bistro.
At June’s scoping meeting, attendees continued to raise concerns: traffic, disruptions from construction, flooding and whether the ground had been fully remediated from past industrial use. Some still focused on Potter’s financial plans for the site, worrying that if he couldn’t fill the commercial spaces or remediate the site he’d declare bankruptcy or fill the space with retail.
“People are asking me to be held to a standard that just doesn’t exist under the law,” Potter said at the meeting’s close.
He believes he is getting the hang of this, figuring out how to organize his supporters and get them to come to board meetings.
“We are getting tremendous support this time around,” Potter said.
If he’s right, he will soon need to show that he is more than an interloper — and that he can actually finish the projects he has been trying so hard to start.