After years of litigation, two homes under construction in Southold

01/16/2015 12:00 PM |
Developer Nick Paleos of Nickart Realty Corp. in Baldwin said the two homes going up along Route 48 near Town Beach in Southold will be finished by July. But they're not for sale. (Credit: Cyndi Murray)

Developer Nick Paleos of Nickart Realty Corp. in Baldwin said the two homes going up along Route 48 near Town Beach in Southold will be finished by July. But they’re not for sale. (Credit: Cyndi Murray)

People driving along Route 48 in Southold have taken notice of construction taking place across the street from Town Beach. Could it be the makings of a hotel? A restaurant?

Not quite.

Developer Nick Paleos of Nickart Realty Corp. in Baldwin said the property, which is located 900 feet west of Bayberry Lane on the southern site of Route 48, is the site of two new homes. 

The residences won’t be listed for sale when completed, Mr. Paleos said Tuesday, declining to go into further detail.

Slowed by years of litigation with Southold Town, construction on the homes began late last year after the project received final approval from the town Planning Board.

The houses, which have been in the works for almost two decades, are being built on neighboring 17,500-square-foot lots.

The first step of the process began in 1997, when Mr. Paleos submitted an application to the town Zoning Board of Appeals to subdivide his 35,000-square-foot parcel into two residential lots. A variance was required from the ZBA since dividing the parcel would make each lot less than the required 40,000 square feet needed for single-family construction under town code.

The application was passed by the ZBA but stalled before the Planning Board due to concerns over how waste would be handled.

In 2008, Mr. Paleos appeared before the Planning Board after he received a sanitary flow credit from a nearby property owner. He was able to use it to get a variance from the Suffolk County Department of Health permitting him to install a private on-site sewer system — something that otherwise isn’t allowed under the county’s sanitary code. However, Planning Board members said the county’s variance didn’t supersede the town’s code on installing sanitary systems. They also argued that the sanitary flow credits could only be used for affordable housing applications.

In 2010, the Planning Board agreed to approve Mr. Paleos’ application under the condition he provide proof of compliance with town rules on the transfer of sanitary flow credits or proof that the county health department would have approved the proposal even without the transfer of sanitary flow credits, according to planning department documents.

In response, Nickart Realty Corp. filed an Article 78 legal action contesting the board’s decision to add the last-minute conditions when approving the resolution, adding that town code didn’t supersede county approval.

The court sided with Nickart Realty Corp and the town appealed the decision in 2013. However, a judge once again ruled in favor of the developers.

The Planning Board signed off on the final application in February 2014, paving the way for construction to begin on the two homes.

Mr. Paleos declined to comment on the previous litigation but said the houses will be finished by July.

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