Meadow Lane house seized by government sells for $25.9 million; highest in Hamptons this year. - 27 East

Real Estate News

Real Estate News / 1417133

Meadow Lane house seized by government sells for $25.9 million; highest in Hamptons this year.

icon 1 Photo

author on Aug 31, 2009

An oceanfront house in Southampton Village, seized by the federal government last spring after its owner was indicted for fraud, was sold recently for $25.9 million, the highest closing price for a house on the East End in nearly a year, according to an agent involved in the transaction.

The house, which sits on 2 acres off Southampton’s posh Meadow Lane, was purchased for $27 million in December 2008 by James Nicholson. Almost immediately after the purchase, Mr. Nicholson re-listed it for $34 million. In April, Mr. Nicholson was arrested on federal fraud charges of bilking investors out of $160 million by falsifying financial records of several hedge funds he operated. He was dubbed a “mini-Bernie Madoff” by multiple New York City media outlets.

The house was later seized by the federal Securities and Exchange Commission and was in receivership, making it a complicated sale process. Two unnamed buyers entered a bidding war before a sealed bid was accepted and the house sold on August 13.

Before the sale could go through, the receiver, a Manhattan attorney, had to be satisfied with the price first and then the federal government, being the official seller, had to comply with laws governing the sale of what is effectively public property.

“It was an extraordinary process,” said Jennifer McLauchlen of James R. McLauchlen Real Estate, the buyer’s broker. “It was an excruciating six weeks. It was very complicated, very harrowing and very interesting. I’m glad it worked for my customers.”

Because the house was in receivership, Ms. McLauchlen’s clients had to meet the price asked by the receiver. Once a $23.5 million bid was accepted, the SEC posted the proposed selling price in a public listing for two weeks. A second interested party made an offer and a bidding war ensued between the two prospective buyers with the final price of $25,895,000 finally coming through sealed bids.

“My customers certainly wanted this particular house,” Ms. McLauchlen said. “With the federal government involved, and the receivership, it gave anybody in the world the opportunity to bid, which is exactly what happened. This was a very different situation than I’ve ever had to deal with—probably than anybody out here has ever had to deal with.”

Sotheby’s broker John McHugh, who sold the house to Mr. Nicholson last year and held the listing for the subsequent re-sale, said the sale was highest price paid for an East End property yet in 2009.

Working with a house in receivership, he added, was a rare concern for an East End broker, he added, for now.

“I’ve never had to deal with it before, but I have a feeling there are a few more coming down the road,” he said.

You May Also Like:

June Saw Increase In Hamptons Homes Entering Contract

The Hamptons saw an extraordinary uptick in signed contracts for single-family homes in June as ... 7 Jul 2020 by Brendan J. OReilly

CPF Revenue For First Five Months Of 2020 Is Record Breaking

The Peconic Bay Region Community Preservation Fund raked in $45.43 million in 2020 through the ... 6 Jul 2020 by Staff Writer

Planning Board Wants To Put Other Considerations Ahead Of Parking

Sag Harbor Village planning officials are exploring better ways to make decisions when considering redevelopment proposals, rather than looking at the number of parking spaces a project might have. Planning Board Chair Kay Preston Lawson, Village Attorney Denise Schoen and Village Planner Kathryn Eiseman have been discussing better metrics to use in place of weighing the proposed gross floor area of a project versus the availability of parking. “When people are redeveloping properties in the village and wanting to maximize the square footage, we’re running into a couple of issues, the biggest one being the granting of parking variances,” Ms. ... 30 Jun 2020 by Brendan J. OReilly

Sag Harbor Planning Board Wants Ban On Apartment-To-Office Conversions

To preserve an active Main Street and downtown in the village, the Sag Harbor Village Planning Board is pitching a ban on converting apartments to offices. The board is penning a memo to the Sag Harbor Village Board to urge legislation implementing a ban, and members want the Zoning Board of Appeals to also sign on to the idea. “To be blunt, it’s a travesty. It needs to be stopped,” Planning Board member Larry Perrine said during the board’s June 23 virtual meeting. He said turning residences into offices goes against the conceptual ideology of the village’s planning. “It’s against ... by Brendan J. OReilly

Westhampton Beach Officials Identify Potential Impacts Of Rogers Avenue Development

The impact on traffic and how the project will compare to as-of-right development were the biggest concerns raised during a “scoping session” about a proposed condominium project in Westhampton Beach. The Westhampton Beach Village Board and Planning Board held a joint work session on Thursday, June 25, to identify what should be included in a environmental impact statement regarding Rogers Associates LLC’s application for a 52-unit multifamily residential development on 9.4 acres on the north side of Rogers Avenue. Carriage Hill Developers, a housing management firm based in Wantagh, submitted the site plan to the Planning Board in August, but ... 29 Jun 2020 by Brendan J. OReilly

Landlords Powerless To Remove Westhampton Beach Holdover Tenant During Moratorium

A Florida couple wished to live in their Westhampton Beach home this summer, but are ... 26 Jun 2020 by Brendan J. OReilly

Builder’s Modern Home In East Hampton Fetches $7.35 Million

A builder’s modern residence in the Northwest Harbor section of East Hampton by Blaze Makoid ... 23 Jun 2020 by Staff Writer

‘Zoom Effect’ Bolsters Hamptons Home Contract Signings In May

As residential real estate contract signings plummeted year-over-year in May in New York City and on the North Fork and the rest of Long Island, the number of home sales that entered into contract in the Hamptons held steady. Contract signings remaining flat, year to year, wouldn’t normally be cause for celebration for the South Fork real estate market, especially after a weak 2019. However, under the current conditions, the May 2020 results were phenomenal news for the industry locally. Industry professionals identified a couple of reasons why the Hamptons bucked the trend: There was a scarcity of rentals following ... by Brendan J. OReilly

In-Person Hamptons Real Estate Showings Return With A New Look In Phase Two

New York State lifted a number of restrictions on the Long Island real estate industry ... 16 Jun 2020 by Brendan J. OReilly

First Frederick G. Potter House Sells For $18.5 Million

The First Frederick G. Potter House, a circa 1899 East Hampton Village home by legendary ... by Staff Writer

Welcome to our new website!

To see what’s new, click “Start the Tour” to take a tour.

We welcome your feedback. Please click the
“contact/advertise” link in the menu bar to email us.

Start the Tour
Landscape view not supported