Southold ordered to approve Greenport Hotel Moraine expansion

Southold Town must approve a Greenport hotel’s expansion after its rejection of the plan was “arbitrary and capricious,” a New York State Supreme Court Justice ruled.

Justice James F. Matthews issued the stinging rebuke in a Nov. 17 decision, six months after Hotel Moraine’s owner, North Road Hotel, LLC, sued the town over the Zoning Board of Appeals’ denial of the 14-room expansion in April.

“The ZBA determinations were arbitrary and capricious and an abuse of discretion due to the lack of evidentiary basis to support its findings, which are internally inconsistent in numerous respects,” Justice Matthews wrote in his court order.

The town appealed the decision two days later. On Dec. 2, the board approved hiring a law firm — Devitt, Spellman, Barrett, LLP — to act as special counsel in its appeal.

The Hotel Moraine — located on the north side of County Road 48, with sweeping views of the Long Island Sound — had been planning to build a new building containing 10 units and expand an existing building by four units.

The property operated as the Sunset Motel for over 60 years and consisted of five buildings and 24 motel units before being sold to North Road Hotel, LLC, in 2021.

In 1989, Southold Town amended its code to include the Resort Residential (RR) Zoning District to allow resort development, including hotels, motels and conference facilities, with a minimum lot size of five acres.

Due to the Sunset Motel property being 3.25-acres, it was deemed a nonconforming property in terms of lot size. After an eight-unit building was destroyed in a fire in 1995, the ZBA rejected the owners’ request to rebuild the structure due to the 1989 zoning amendment.

However, after considering the property’s history, the ZBA granted approval for the Sunset Motel’s former owners to reconstruct the building.

The new owners, who renamed the property the Hotel Moraine after gaining control, claimed in its petition Southold Town has since then “consistently and continually treated and described the property as conforming, until now.” 

The owners undertook an extensive renovation in 2022. All improvements were fully reviewed and permitted by the town building department, according to court documents. The petitioner noted they were not required to seek variances or special zoning exceptions and all approvals issued were consistent with the 1995 ZBA approval.

In January 2024, North Road Hotel applied for a building permit for the expansion. Southold Town’s building department denied the application and informed them they first needed to obtain site plan approval from the planning board and special exception from the ZBA.

The owners did so in March 2024 and were told by a board assistant to the ZBA that they may need to apply for a variance, despite the building department not issuing a new disapproval notice, according to court records.

The owners proceeded to go through SEQRA environmental reviews. But three months later, the Southold Town Board imposed a one-year hotel moratorium that it later extended through June 2026.  The Hotel Moraine extension project remains exempt from this ban.

A ZBA public hearing followed in August 2024, where one resident complained about potential noise impacts of the construction. The property is adjacent to the Cliffside Residential condos and across the road from the San Simeon by the Sound nursing home.

After four adjournments, a second hearing was held in April 2025, during which the ZBA expressed concerns “about a precedent being set if it granted the lot area variance,” court documents stated.

The hotel owners applied for both a ZBA special permit and an area variance — both were denied.

Justice Matthews concluded the Southold ZBA did not have the jurisdiction to require North Road Hotel to file for a lot area variance.

He noted the letter of disapproval from the building department, which formed the basis of the appeal to the ZBA, did not state the need for the hotel operators to obtain an area variance. He cited case law showing a zoning board of appeals’ jurisdiction is “appellate only.”

Without administrative determination to review, a ZBA is “without power to grant a variance.”

“The zoning history and improvements to the property up and until the subject application for a special use permit did not treat the property as non-conforming as to lot area,” the judge wrote. “In fact, the building department came to the same conclusion.”

He also took issue with the negative precedent issue and said there was “nothing in the record” to support this claim. He argued the single complaint about the noise did not prove there would be an adverse impact.

A court date for Southold’s appeal was not available.